Toluene Prices Demonstrate Mixed Market Sentiments Across The Globe
- 22-Aug-2022 4:27 PM
- Journalist: Jacob Kutchner
Throughout the first two quarters of 2022, the global solvent industry has been strengthened by rising raw material costs, labour shortages, and persistent supply chain turmoil. The active inquiries from the downstream sector have further bolstered Toluene's market.
As per the latest insight, Toluene prices in India have risen by approximately 1.1% this week compared to the previous week. In the domestic market, the price of Toluene Ex-Kandla has been around USD 92000 per tonne. Rising input costs for raw materials, energy, and logistics have also put significant pressure on Toluene's price realizations. Despite a positive demand outlook, downstream paint and coating market players' profit margins have been squeezed due to high inflationary pressure coupled with increased operational costs. On the other side, China was already staring at multiple economic challenges, now dealing with a severe power outage caused by an intense heatwave in the country's southwest region, which has forced many factories to close temporarily, potentially disrupting the supply chain network. As a result, Toluene Ex-Shanghai has offered at USD 1130/MT in the week ending August 19th.
Furthermore, European Toluene prices were already rising, supported by robust export demand and tight supply amid port congestion and dropping Rhine levels. Therefore, prices of Toluene surged by 1.6% during the same time frame. At the same time, the tumble in energy prices in the United States has primarily reflected the sharp decline in crude oil prices, an indication of easing global demand and a moderate increase in output. According to the market sources, new and export orders have weakened by entering the mid-third quarter of 2022. Furthermore, the price decline has been attributed to sufficient stockpiles and ease of supply chain pressure. Also, consumer sentiment in the United States has improved amidst ease in the inflationary pressures. According to the data, the price of Toluene was offered at USD 1135/MT with a declination of 7.7% on August 19th.
As per ChemAnalyst analysis, "prices of Toluene will likely follow the upward trend in the Asian and European market owing to the rising demand from the end-user paint and coating sector. Meanwhile, in the USA, prices of Toluene may continue to follow the downtrend if the low crude prices will support for a protracted period. Moreover, ease in the inflation rate may further alter the price dynamics of Toluene in the USA market."