Soaring Feedstock augments the Ethylene Acrylic Elastomer prices in the global market

Ethylene Acrylic Elastomer prices have risen recently in the global market owing to its increasing demand as a lubricant from the downstream automotive industries. The prices have witnessed an upward trajectory recently due to the limited supplies, volatile natural gas prices, soaring demand, and high inflation rates.

Prices of Ethylene Acrylic Elastomer have increased due to several reasons, including the shortage of supplies in the global market, trade disruptions, and high upstream and feedstock prices. Taking pressure from the soaring feedstock prices, including Ethylene and Acrylic monomers, manufacturers of Ethylene Acrylic Elastomer increased the production costs to enlarge their profit margins.

In China, the prices of Ethylene Acrylic Elastomer climbed during the second week of April due to the surging of Covid cases and the implementation of the ‘Zero-Covid policy,’ which hampered the production and trading activities in the region. The end-user demand was not fulfilled due to the lack of inventories. Whereas in India, the prices of the product kept the uphill trend on the back of increased freight charges due to container shortage and ongoing war, hence supplies remained dull in the international market.

In recent weeks, demand for Ethylene Acrylic Elastomer from the automobile sector in the United States has surged and stayed high. For a long time, the vehicle sector has faced a shortage of semiconductor chips, which the war has now compounded. As a result, commodity production has decreased, while operational expenditures have increased. Because of the surging demand for Ethylene Acrylic Elastomer, prices have remained high. In addition, rising raw material and natural gas costs, along with logistical issues in the region, resulted in a material shortage.

Ethylene Acrylic Elastomers, also called AEM rubbers, are utilized in automotive transmission, power steering seals, O-rings, and hydraulic fluids.

As per ChemAnalyst, “Prices for Ethylene Acrylic Elastomer are likely to increase during Q2 2022 owing to the increasing demand in the automotive sector. Russia’s invasion of Ukraine may boost the natural gas prices, which will also impact the market of AEM rubbers.”