US Market Contradicting China’s Acetic Acid Price Trend
- 23-Jun-2022 6:02 PM
- Journalist: Jacob Kutchner
Texas, USA: Acetic Acid prices have been slumping in the Chinese domestic market, primarily due to an oversupply of products and weak downstream demand. Earlier, the Acetic Acid inventories were not that high, but then several manufacturing units restarted their production and overwhelmed the market with the increased supply rate. Firstly, Yangtze INEOS reopened its plant on 9th June, followed by Shandong Yankuang on 17th June, and Celanese Nanjing has been planning to restart its production in the upcoming days. The sudden restart of all these plants shoots up the supply rate in the country, which has eventually been leading towards overflowing inventories.
Meanwhile, the demand for Acetic Acid has been declining in China; while some plants of downstream product PTA (Purified Terephthalic Acid) have been recovering, the majority are still under maintenance, reducing consumption of Acetic Acid in PTA production. Consequently, causing lesser enquiry for Acetic Acid from PTA-based industries. Furthermore, the offtake from Acetic Ester industries has also been low as the rate of plant operations is slow along with lower profit margins. Hence, the weak demand for Acetic Acid from several industries has been supporting the high supply in dropping the Acetic Acid market value. In addition, the overall export of Acetic Acid offshores was much lower than it was supposed to be, which has further been contributing to the overabundance of Acetic Acid in the domestic market.
On the contrary, major manufacturing plants such as Celanese and INEOS have declared force majeures in the USA amidst raw material shortages, following which the supply rate has been hampered in the country. Besides, the downstream demand from end-user industries such as paints, coatings, pharmaceuticals, food, and beverage has been strong, escalating the price of Acetic Acid in the USA.
As per ChemAnalyst anticipations, “The pricing trend of Acetic Acid would keep contrasting in China and the United States, until and unless force majeures discontinue in the USA or Downstream demand improves in China to make use of all that has been produced till date.”