Weak Feedstock Costs Plunge the Anisole Prices in China and Germany
- 04-Nov-2022 3:14 PM
- Journalist: Timothy Greene
Anisole prices have gained a downward trend across the Asian and European markets during the last week of October 2022. The economic condition continues to worsen with record inflation, uncertainties in China, and weak demand have slowdown the market growth of Anisole.
In the Chinese market, prices of Anisole have marginally dropped during the week ending 28th October 2022, supported by the sufficient inventory level coupled with bearish demand from the downstream agrochemical and allied industries. On the raw material front, phenol prices have plunged by around 2%, further supporting the Anisole prices to decrease in the domestic market. According to the data, China's manufacturing activity reduced amid China's zero Covid policy and recession fear. Besides, PMI shifted to 49.2 in October, as COVID-19 curbs weighed on overall output and demand. Also, the inflows of new export orders have fallen due to slow economic activity, forcing the manufacturer to revise their price quotation. As a result, Anisole prices FOB Qingdao were assessed at USD 4035/MT during the same time frame.
Similarly, weak feedstock phenol prices have negatively impacted the Anisole prices in the German market. Also, energy prices have plummeted in the European market, and Anisole's production cost has eased, decreasing its market prices. Although experts believe this drop in energy prices is only temporary, the market will be in trouble again when Europe hits peak winter, bringing increased demand for energy. Additionally, downstream agrochemical and allied industries' demand has still suffered due to the high inflation rate. On the other side, port congestions, vessel bunching, and yard occupancies have declined in the region; the supply chain has normally been operating, resulting in cheaper imports from exporting countries like Asia and the USA, thus leading to a sufficient inventory level. In conclusion, in Germany, prices of Anisole plunged by around 2% on 28th October.
According to ChemAnalyst analysis, "Anisole prices will further drop in Asia and Europe during the coming weeks owing to weak feedstock phenol prices. Demand from the end-user industries has remained lackluster. Meanwhile, in Europe, the purchase volume of Anisole is expected to remain low, and some buyers may turn to imported materials".