For the Quarter Ending June 2023
North America
Throughout the second quarter of 2023, the cost of AluminoSilicate saw a downward trend in the US market due to bearish construction activities in the region. The merchants continued to work through their existing stocks in the domestic market. The demand for the product did not rise due to the sufficient availability to meet the requirements of the downstream construction industry. Cost pressures continued to dwindle across the manufacturing sector as suppliers sought to boost their sales and offer reduced prices. The decline in the health of the sector was the most severe in 2023 to date and stemmed from a marked reduction in new orders. Further, the Manufacturing Purchasers Index holding points below threshold limits for the entire second quarter of 2023 indicates the deteriorating of economic activities and subdued the construction sector in the US. Production growth was frequently linked to a larger workforce and rapid input deliveries, which enabled businesses to catch up on work delays—the supplier's delivery times improved further and, to the greatest extent, were on record in the US market.
APAC
In the second quarter of 2023, the market for AluminoSilicate remained bearish in China due to the weak performance of the downstream construction industry. In China, the manufacturing PMI fell below its threshold limits, indicating a decline in production and poor performance from the construction industries. The pace of market recovery slowed down in the second quarter of 2023, and there was not enough momentum for prices to rise. Overall, global trading activities stagnated in Q2, and the demand for the product did not increase from domestic and overseas markets. However, weak exports and confidence continue to hinder private-sector investment. Further, industrial production has experienced a slowdown due to subdued exports in China. The manufacturers set lower prices in the market since there was sufficient material in the Chinese market to satisfy the needs of the downstream industry. Particularly, with limited support for the building industry, the marginal investment in real estate has declined and is still bottoming out in the short term.
Europe
In the second quarter of 2023, the AluminoSilicate market remained sluggish in Germany due to the bearish construction activities' performance around the country. Business conditions across the German construction sector took a turn for the worse in the second quarter of 2023, with building companies recording faster declines in both activity and new orders amid a backdrop of rising interest rates, customer uncertainty, and wider inflationary pressures. June 2023 also saw German constructors make deeper cuts to their purchasing activity, which showed the sharpest decline for more than three years. Lower demand for building materials and products helped to alleviate the pressure on construction supply chains. This was underscored by a continued marked improvement in lead times on purchases. One of the main headwinds facing the construction sector was rising interest rates. Alongside heightened customer uncertainty and still-high building prices, it led to further strain on demand for construction work, as highlighted by a further steep drop in new orders.
South Africa
The price of AluminoSilicate witnessed a declining pattern in the South African region due to the poor performance from the downstream construction and other allied industries throughout the second quarter of 2023. The power cuts have worsened the country's economic crisis and hindered the construction industry developments. The demand for AluminoSilicate did not improve, and the market had enough supply in the country. Along with persistent load-shedding, the construction mafia is a growing threat to South African construction businesses. Criminal syndicates posing as local business forums, making it difficult for many companies to operate. With power outages and inflationary pressures weighing on company activity, the South African economy shrank for the second quarter of 2023, which resulted in a decreasing trend in the Aluminosilicate market. The daily costs of outages hinder investment and major infrastructure projects and seriously affect the delivery of goods and services. The continuous supply from the manufacturer limits the product's price, and improved supply chain activities further subdue the price of the product.
For the Quarter Ending March 2023
North America
In the North American market, the price of AluminoSilicate observed declined trend throughout the first quarter of 2023 due to the poor demand from the downstream construction, paints & coating industries. Furthermore, a decline in raw material Sodium Silicate was also attributed to the manufacturer's quoted lower prices to the buyers. The market was unfavorable for purchasing from end-use enterprises due to the high interest rates, rising prices of associated commodities, and other key driving factors. As per the data, the US market noted a decline in the price trend of around 7.2% in Sodium AluminoSilicate during the first quarter of 2023.
APAC
The Asian market witnessed an inclined trend in AluminoSilicate during the first quarter of 2023. China has accelerated infrastructure investment in the first quarter of this year to propel economic growth and drive up the activity of many associated downstream enterprises and broad market demand for basic materials, including AluminoSilicate. China opened the market after the Lunar holidays; the market got improved and received more orders from the overseas market, further supporting the price trend. On the other hand, the Indian AluminoSilicate market saw an uptick due to the high imported cargo from the overseas market was attributed to a positive price pattern in the Indian domestic market. According to ChemAnalyst, the cost of Aluminosilicate in the Chinese market was around USD 1112/MT during the last month of the first quarter of 2023.
Europe
Prices for Aluminosilicate decreased in the first quarter of 2023 as a result of the weak demand from the European region's downstream construction sectors. The price of the product dropped, and fewer new orders from both the domestic and overseas markets were received. The construction industry in Europe has been significantly impacted by an increase in borrowing costs, rising material costs, and fears of a recession, all of which have the potential to significantly lower property prices. Companies are reducing the scope of their construction projects to accommodate the inflation factor as a result of the rising construction costs for property developers. In addition, the European Central Bank (ECB) hiked interest rates significantly by 50 basis points in response to recent volatility in the banking sector, signaling its readiness to provide liquidity support for banks. As interest rates rise, demand often drops, which might be negative for the global construction industry.
In the North American market, falling demand remained a major matter of distress during Q4 2022, as producers were extremely concerned over their inventory levels and future production cuts. In the USA, demand for Aluminosilicate declined from the downstream paints and coating industry due to pessimistic market conditions. Furthermore, declined raw material Sodium Silicate cost (-3.4%) also opportune manufacturers to negatively revise their offers in order to sustain offtakes from the niche buyers. As per the data, the US market noted a decline of around 9.4% in Sodium Aluminosilicate prices during the fourth quarter of 2022.
The Asian market has witnessed a steep decline in demand from the downstream sectors while availability remained ample enough to satisfy all the needs. As per the data, Aluminosilicate prices fell drastically (-9.2%) in China during Q4 2022 due to escalated pandemic-related uncertainties in the country. Demand for the product from the downstream construction sector plunged due to prolonged dullness in purchases exacerbated by the sudden escalation in COVID cases in the country. The effect of this price fall was observed in the prices of Aluminosilicate in the Indian market, as despite comparably better offtakes, cheaper offtakes led to a decline of a similar extent during the quarter.
A drastic change in demand for Aluminosilicate has been observed in Germany during this quarter, owing to rising tension over recessionary pressure looming after the escalation of Russia Ukraine war. The escalated anxiousness about for economic slowdown kept on injecting qualms in the domestic Aluminosilicate market, as traders were worried about existing inventories. Furthermore, cheaper imports remained another major driving factor behind this price trend, leading to a steep fall of around 10.5% within the quarter. Additionally, the threat of another energy crisis was avoided successfully, protecting the market from another unnecessary rise in raw material prices.
