Weak Market Sentiments Drive Down European Cyclohexane Prices
- 02-Dec-2022 1:54 PM
- Journalist: Timothy Greene
Throughout the month of November 2022, the price of Cyclohexane in the European market is consistently falling. The low-cost pressure from the upstream Benzene market supports the price of the downstream derivatives, including the Cyclohexane market in Europe.
Cyclohexane's prices have declined due to lower demand from European downstream players and fewer orders from importing nations. In terms of supply, the steady supply from traders and the product's adequate availability on the ground to meet demand from downstream sectors. The European economy's downturn and the possibility of recession have reduced orders from end-use industries in the domestic market. The abundant availability of natural gas has stabilized the European market and decreased its price, and European natural gas has stored more than 70% of its supply. Cyclohexane has widespread availability also exacerbated a negative trend in the Europe market. Most European consumers are pessimistic about their country's economy due to the negative market sentiment; further importing nations reduced their orders, including Belgium, France, and other European countries. The purchasers decided to buy the product based on their needs. The product's production cost dropped because of fewer energy costs and decreasing domestic demand in the Europe market. Germany's high inflation rate and the rising cost of living further reduced consumer spending.
An analyst estimated that Cyclohexane costs around USD 1650 per MT FOB Nuremberg, with a weekly depreciation of 3% on December 2, 2022.
According to ChemAnalyst, the cost of Cyclohexane may continue to fall in the European market in the upcoming weeks due to weak market sentiments. In the meantime, Cyclohexane producers may sell out their materials at lower prices owing to the high product availability on the field and destock the product at the end of the year. The weak demand from the global markets may also contribute to a negative price trend for Cyclohexane in the forthcoming weeks.