US Acetonitrile Prices Continue to Follow Upward Trend Amid Healthy Demand
- 20-Jun-2023 3:43 PM
- Journalist: Gabreilla Figueroa
Acetonitrile prices for both Pharmaceutical and Industrial grade showcased an upward trajectory in the USA during May 2023 and are projected to follow a similar pattern in the approaching months. The increase in demand for Acetonitrile was driven by its major application as a reagent, reaction solvent, or extraction solvent resulting in its continuous demand coupled with limited stocks among the merchants.
In the US, inflation eased to the lowest rate in two years in May 2023, mainly due to a decline in energy prices such as gasoline and electricity. One of the reasons for this price decline was a result of Russia's invasion of Ukraine. Energy prices decreased in May, subtracting 19 basis points from April's inflation rate, while gasoline prices decreased by 5.6%. Moreover, despite decreasing upstream costs for the Petrochemical sector, the cost of Acetonitrile increased moderately in May. This was supported by the fact that consumer confidence improved to some extent, and as per May's analysis, it was witnessed that the US Consumer Price Index (CPI) surged by 0.1 in May on a seasonally adjusted basis, after increasing 0.4 percent on April, supporting the positive demand outlook for Acetonitrile in the domestic market. Also, the merchants are expected to raise their trading momentum to prevent further delays or the shortage of products.
In addition, the combination of a resilient US economy and a decline in inflation has underpinned inflation-adjusted wage growth. In May alone, real average hourly wages increased by 0.3 percent from a year ago and by 0.2 percent in the 12 months. This is the first year-over-year increase in real wages since March 2021. The tight labor market underpins robust consumer spending, a key factor in sustaining market growth across multiple sectors.
On top of this, the downstream market sentiment for Acetonitrile has not been affected by its upstream market, as the spread graph between downstream (Acetonitrile) and feedstock (Acetic Acid) and (Ammonia) narrowed, but still, the inquiries remained positive. As the market activity remained strong and downstream support remained high, manufacturers focused on de-stocking their previous stocks and placing newer orders in order to meet the surge in demand in the coming months. Moreover, market participants anticipate that in the coming months, regarding uptakes, the downstream industry will see a positive development. The quotation of Acetonitrile from other regions is expected to increase, resulting in better trading and an upturn in Acetonitrile prices.