Weak Demand Led to a Decrease in Aniline Prices in the US Market

The Aniline market showcased bearish sentiments in the US during October 2023, and prices fell by almost 9% during the month. In the first half of October, the Aniline quotations rolled over by exporters amid no market movement in key Aniline exporter China because of Golden Week Holidays. However, during the second half of October 2023, the Aniline prices declined noticeably in the USA as exporters reduced their quotations due to an ease in production costs amid a decrease in the feedstock Benzene prices. The upstream Naphtha prices decreased amid a decline in Crude Oil prices by OPEC+ due to stabilization in speculations around the supply chain disruptions in the Middle East amid conflict between Israel and the Palestinian Islamist Group.

As per the sources, the USA manufacturing sector Purchasing Manager’s Index remained stable during October 2023, indicating neither expansion nor contraction in the manufacturing sector activities. Demand dynamics remained average from the downstream Pharma sector and dye manufacturers. Meanwhile, orders from Methylene Diphenyl Diisocyanate producers are moderately low due to sluggish inquiries from the Polyurethane segment.

According to the ChemaAnalyst data sources, Aniline CFR Texas prices assembled at USD 1912/MT at the end of October 2023.

Aniline prices were firm in September due to increased procurement activities before the weeklong holidays. At the same time, cost support was high on feedstock Benzene due to the escalation in upstream prices amid Crude Oil production cuts by OPEC+ and Russia. Consequently, the operating rates declined in the producing countries amid the stressed availability of feedstock supplies. Simultaneously, the cost support was firm on Aniline key feedstock Nitric Acid amid firm demand from fertilizer manufacturers. The demand for fertilizers escalated amid an increase in procurement activities before autumn season applications. Simultaneously, the high demand for upstream Natural Gas due to increased restocking practices for the winter season limited the production rates. However, the upstream cost fell on feedstock Benzene amid ease in Crude Oil prices towards the end of the month and reduced the production costs of Aniline, and prices remained stagnant at the beginning of October 2023.

As per the assessment, the Aniline price trend will remain stable, and prices will improve marginally during the second half of the final quarter of 2023 amid moderate demand dynamics from the buyers. According to the sources, the water levels of the Mississippi River have reduced noticeably, and logistics companies have issued restrictions on shipments through the Mississippi River. So, the supply chain activities will remain affected, and export rates of Aniline from international exporters will remain low. Concurrently, the retailers are preparing Black Friday sales in November 2023. So, procurement activities may improve for pharmaceutical dye makers and the pharmaceutical sector. However, demand from the Methylene Diphenyl Diisocyanate industries will remain low due to a switch in demand to bio-based products.