The global market of Xanthan Gum has continued to show signs of weakness in early September and has observed decline in market value. The oil drilling sector was in a weak phase as suppliers were facing subdued demand. The inventory management strategies by buyers remain conservative and new production cycles were adding to the stockpile. This resulted in a downward trend in market which is not due to supply constraints but because of the weak end-user demand. The strategic pricing from Xanthan Gum suppliers and cautious procurement from buyers were shaping a landscape where prices are softening.
The bearish situation was a result of slowdown in oil drilling activity. The global rig counts were contracted and the historical data confirms that September is continuing the downward trajectory which was seen in August. The buyers in the oilfield services sector were operating with sufficient inventory...
