Southeast Asian n-propanol market remains robust amidst brisk demand and production challenges

Since the beginning of 2024, the chemical sector saw a price hike in n-Propanol in Asia amid increased demand and buying activities from the manufacturing industry due to its widespread use as a solvent in various industries. Simultaneously, the market competition increased from China due to the approaching holidays and increased purchasing and stocking practices from buyers. Consequently, during the prime month of 2024, the n-Propanol prices witnessed an increase of 3.5%. Similarly, in the first week of February 2024, domestic producers raised the n-Propanol quotations by 1.1%.

The demand for n-Propanol was consistent amid the rise in orders for the solvent from the Household & Personal Care sector. Simultaneously, the inquiries were firm from regional food packaging ink manufacturers due to the increased consumption of packaged food in the region. Meanwhile, the n-Propanol orders continued to remain low from the herbicides and insecticide manufacturers due to depressed demand for agrochemicals from the agriculture sector during winter.

At the same time, the cost support on n-Propanol increased on the feedstock Ethylene during the week amid increased demand and consistent stocking practices from regional buyers, leading to higher production costs. Concurrently, the production rates were affected due to the stressed availability of upstream Ethylene supplies amid declining transaction rates and affected operating rates in the manufacturing units. The Red Sea attacks in the Middle East region and an increase in ship traffic at the Cape of Good Hope resulted in the delay of upstream Crude Oil supplies in the Asian region. Meanwhile, a missile attacked an oil tanker on the coast of Yemen towards the end of January 2024, which further aggravated supply concerns.

As per the ChemAnalyst data sources, in South Korea, the n-Propanol FOB Busan prices hovered at USD 900/MT at the end of the week concluded on 2nd February 2024.

As per the estimation, the n-Propanol prices will remain firm and increase gradually in the upcoming weeks due to high stocking practices from downstream industries before the Seollal festival in South Korea and a decline in logistics activities during the Spring Day festival in China. Meanwhile, the demand for n-Propanol will escalate from the agrochemical industries as the spring season is approaching the Northern Hemisphere, and agrochemical consumption will surge in the agriculture and Horticulture sectors. Simultaneously, n-Propanol orders from cleaning agents and floor polish manufacturers will remain firm due to the anticipated increase in consumption from the household sector during festivals around spring in Asian countries.