Propionic Acid Prices Fall in India Amidst Low Consumption Rates From Downstream Industries

In May 2023, the Propionic Acid price movement shifted in India, and prices observed a fall during the month. The trading and supply activities stagnated from regional exporter China during the Labour Day holidays from 1st May to 3rd May 2023. The inventories were sufficiently available in the domestic market due to firm trading and procurement activities from the regional exporters in the concluding week of April.

The fluctuation in Propionic Acid prices halted during the prime week of May 2023, and prices rolled over by suppliers amid no change in market dynamics and stable demand-supply dynamics. Meanwhile, new orders remained moderate from downstream buyers, and consumption levels were underwhelming in the downstream industries.

Simultaneously, the upstream cost support fell amid previous plunges in the feedstock Ethylene costs amid reduced cost support from upstream Naphtha and Crude Oil and declined demand from downstream value chains.

Consequently, the Propionic Acid price trend shifted in mid-May, and prices fell and showcased bearish movements. The demand from the Pharmaceutical was moderate, while inquiries from Polymer industries declined amid sufficiently available supplies in the market.

Conclusively, the Propionic Acid prices witnessed an overall 2.3% reduction in the last month’s discussions, and Propionic Acid Ex-Ahmedabad prices hovered at USD 1510/MT. On the contrary, in March and April 2023, the Propionic Acid prices were firm in India.

Furthermore, the contract prices of feedstock Ethylene prices remained stationary, having no significant impact on the production costs of Propionic Acid during the month. Towards the end of the month, prices fell again due to the decline in demand for food additives in the food sector.

As per the ChemAnalyst estimation, “The Propionic Acid prices are likely to decline further during the mid-summer season. The reason is the slack demand from rubber industries and declining offtakes of Propionic Acid from the food sector. The stocks are amply available in the domestic market. Furthermore, the demand will likely improve from food preservative industries during monsoon in India.”