Is the Recent Recovery in US EPDM Rubber Market a Long-Lasting Scenario or Just a Passing One?
Is the Recent Recovery in US EPDM Rubber Market a Long-Lasting Scenario or Just a Passing One?

Is the Recent Recovery in US EPDM Rubber Market a Long-Lasting Scenario or Just a Passing One?

  • 17-Jan-2023 4:03 PM
  • Journalist: Gabreilla Figueroa

Texas, US: The prices of EPDM Rubber which was declining consistently for several weeks, became stable during the first week of 2023, followed by a marginal rise in the next week. This sudden shift in EPDM Rubber market sentiments has expected to be caused by the latest improvements in the market performance of the automotive industry. The FOB prices of EPDM Rubber Medium Diene showcased a rise of 1% during the week ending on 13th January 2023. According to several market researchers, the automotive industry has lately been making required recoveries in production volumes. Everything seems fine, but will this resurgence in the EPDM Rubber market outlook stay longer in the US, or will it just evaporate as the year proceeds?

If we take the word of market experts for it, they suggest that the demand for automobiles will decline over the next several months due to consumers' lack of motivation to consider buying new or even old cars due to the unstable economical environment. Although the AFS projection is currently predicting an improvement in the production outlook for North America in 2023, the possibility of a deeper recession and ongoing rate hikes are producing a forecast scenario in which recovery may be delayed by an additional 12 months. Analyse that, it can be said that the growth in the EPDM Rubber market might get delayed as well.

Global central banks increased interest rates to fight inflation, which stunted the expansion of the industrial sector. Since investing capital has been almost cost-free for so long, markets have taken it for granted. With the US Federal Funds Rate starting in 2022 at 0.00-0.25% and completing the year at 4.25-4.50%, rates have skyrocketed recently, making borrowing significantly more expensive. As the Fed attempts to bring inflation under control, these rates are anticipated to increase above 5% in 2023, which will impact the automotive industry and, in consequence, the EPDM Rubber market.

As per ChemAnalyst's anticipation, "After analyzing all these factors, 2023 is not seeming to be good in terms of consumer buying interest for automobiles; hence the demand for EPDM Rubber is likely to suffer with the same. However, the ongoing attempts of the US automotive industry to increase production this year could soar the demand for EPDM Rubber. Nothing can be said with surety, but this sudden rise in EPDM Rubber prices is sure going to provide the manufacturers with momentary relief."

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