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Toluene Prices Hold Steady in North America Amidst Market Volatility and Panama Canal Maintenance
Toluene Prices Hold Steady in North America Amidst Market Volatility and Panama Canal Maintenance

Toluene Prices Hold Steady in North America Amidst Market Volatility and Panama Canal Maintenance

  • 12-Apr-2024 3:51 PM
  • Journalist: Gabreilla Figueroa

Louisiana (USA)- Toluene prices remained steady in North America despite the ongoing increase in WTI crude oil and naphtha prices in the region. Manufacturers of Toluene are striving to maintain a balance between supply and demand within the domestic market. The cost of producing Toluene is closely connected to the overall costs of naphtha and crude oil in the domestic market. Market fluctuations occurred amidst the variations in US crude oil inventories. The surge in U.S. crude oil inventories adds to existing price volatility. The final price quotations for Toluene in the US market were observed at USD 1170 per MT, FOB Louisiana for the week ending April 5th.

The Panama Canal Authority (ACP) has announced maintenance work on the Panamax locks, which handle about 70% of all ship crossings. This maintenance will reduce the daily number of vessel transits through these locks for nine days in mid-May. An additional day of downtime has been allocated for unforeseen maintenance delays, extending the maintenance period and the return to 20 total Panamax lock transits. These nine days of reduced transits are expected to decrease total transits during this period. This may reduce the export volume of Toluene to the international market from the US. To manage potential competition among vessels seeking to transit during this time, the Panama Canal Authority (ACP) may assign additional transits per day for each vessel based on the canal's daily water consumption.

According to the Energy Information Administration, U.S. crude oil inventories increased more than anticipated due to refineries decreasing their capacity utilization. Commercial crude oil stocks, excluding those in the Strategic Petroleum Reserve, climbed for the week ending April 5, 2024. As a result, the production cost of Toluene is anticipated to remain under control, and Toluene manufacturers may be able to meet both domestic and international demand outlooks.

Another governing factor of Toluene price fluctuations in the US market has been firm inflation rates. This may primarily occur due to rising housing and energy prices, according to the Labor Department's report. The consumer price index (CPI) rose for the month, matching February's increase, which was higher than the anticipated 0.3% gain. The demand outlook for commodities from paints, varnishes, detergents, Toluene diisocyanate, benzoic acid, and the personal care sector is expected to remain stable and move steadily in the coming weeks. According to ChemAnalyst, Toluene prices in the domestic market are expected to remain on the positive side owing to stable demand and price variations in WTI crude oil and naphtha prices.

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