US Fatty Alcohol Ethoxylates Prices Gain Momentum Amidst Palm Oil Price Rise and Global Shipping Challenges

Texas, USA: In the US market, the prices of Fatty Alcohol Ethoxylates have started to gain momentum with the start of the year 2024 amid an increase in the upstream, Palm Oil prices. The Fatty Alcohol Ethoxylates market players have been returning from the holiday season incorporated last month and were willing to stock their inventories in anticipation of demand revival from the downstream Personal Care industries. Throughout the past few quarters, persistent inflationary pressures and volatility in energy prices have significantly impacted the pricing dynamics of various chemicals, including Fatty Alcohol Ethoxylates. In addition, the rise in Crude Oil prices over Middle Eastern supply following disruptions at an oilfield in Libya and enhanced tensions regarding the Israel-Hamas war have further shifted the biodiesel manufacturers towards Palm Oil.

However, in December, there was a drop in the prices of Fatty Alcohol ethoxylates as the market was dominated by tepid demand fundamentals. In addition, the destocking season and the holidays at the year-end have further prompted the manufacturers to avoid the accumulation of inventories.  However, since the beginning of January 2024, On the upstream front, the prices of Palm Oil have inched higher across the regional markets, leading to an increase in the manufacturing costs of Fatty Alcohol Ethoxylates. According to the Malaysian Palm Oil Board, palm oil stocks at the world's second-largest palm oil producer are expected to be below 2 million metric tons in 2024, pegged at 1.95 million metric tons, compared to 2.29 million metric tons at the end of December 2023, pressuring the market fundamentals of downstream Fatty Alcohol Ethoxylates. Throughout the first half of 2023, the persisting labor shortage significantly impacted Palm Oil production. For 2024, the labor situation is expected to improve, but concerns about availability remain intact, leading to supply-side concerns for Fatty Alcohol Ethoxylates manufacturers.

On the other hand, Over the past nine months, certain shipping traffic has been redirected to the Suez Canal due to drought conditions affecting the Panama Canal. This shift has raised concerns about potential delays from both canals, which could impact global ocean shipping and, subsequently, truck freight further down the Fatty Alcohol Ethoxylates supply chain.

According to the pricing intelligence of ChemAnalyst the prices of Fatty Alcohol Ethoxylates might settle on the higher end. The rise in upstream Palm Oil prices amid the Spring Festival Holidays in China is also expected to provide sufficient cost support to the price realizations of the downstream derivative, including Fatty Alcohol Ethoxylates. Due to ongoing geopolitical instability and reduced vessel traffic through the Suez Canal, there is an expectation among Fatty Alcohol Ethoxylates manufacturers for a rise in Asia-U.S. East Coast container shipments using the Panama Canal instead. This shift is anticipated to raise freight costs for a range of goods, including raw palm oil, and contribute to optimistic market outlooks for Fatty Alcohol Ethoxylates.