In April, global prices of Tall Oil experienced a steep increase, supported by the convergence of firming downstream demand and constricting supply in the major markets. The trend was witnessed across North America, Europe, and the Asia region, as market players reacted to shifting fundamentals by appropriately aligning price directions.

Among the leading driving forces for the upward bullish price trend was growing downstream industry demand for rubber additives, surfactants, adhesives, and inks. The industries were increasing applications of Tall Oil derivatives like tall oil fatty acids (TOFA) and tall oil rosin (TOR) that were producing enhanced customers' competition and supporting developing the rising price momentum.

Furthermore, increasing Tall Oil consumption in the production of bio-based fuel and green chemicals, particularly in the United States as well as certain regions of Europe, put added pressure on the supply side. Tall oil feedstocks are progressively being utilized to make renewable diesel, adding even more demand-pull pressure. This downstream demand growth prompted the buyers to contend even more vigorously, additionally putting upward pressures on prices.

Notably, India is also making efforts to introduce more biofuels into its fuel blend in an attempt to shift towards cleaner energy, which is driving demand for tall oil-based feedstocks in the country. This governmental emphasis on green fuel sources will continue to fuel downstream consumption of Tall Oil derivatives.

In the United States, the relentless decline in factory output, driven by elevated input costs, imposed incessant pressure on domestic supply chains. Tariffs added to imported products, further pushing up the price of basic raw materials and raising production costs across most sectors, impacting Tall Oil prices.

At the same time, geopolitically tensions increased as China declared a blanket 34% tariff on all U.S. imports from April 10, 2025, in response to the U.S. administration's imposition of aggressive tariffs. As China imports Tall Oil and chemical intermediates thereof from the U.S., these tariffs impacted supply chain significantly and increased the cost of sourcing from American suppliers. This not only decreased the supply of Tall Oil in China but also prompted regional buyers to seek more expensive, fueling price inflation.

As a reaction to these market dynamics, the suppliers and the traders manipulated their prices to attain optimal margins of profit, benefitting from high demand and insufficient competition. The market players noticed increased spot prices as well as lower quantities available at discounted rates. The buyers, also expecting higher hikes, started to restock more aggressively, which further increased pressure on Tall oil prices.