For the Quarter Ending December 2022
North America
Butyraldehyde prices declined continuously in the USA market throughout the fourth quarter of 2022 owing to sufficient inventory and weak demand dynamics. Feedstock Propylene prices have dropped, which eased the overall production cost of the Butyraldehyde in the regional market. Additionally, consumer sentiment has decreased in the region, which has been witnessed by the decline in the manufacturing Purchasing Index, which dipped below 50 (i.e., 49.7) in November, indicating a reduction in both industrial and manufacturing activity. Meanwhile, cheap imports from Asia weighed down the prices of Butyraldehyde in the regional market. Furthermore, demand from the downstream paints and coating and other competitive industries has decreased amid seasonal dullness, supporting the decline in the price realizations of Butyraldehyde in the regional market.
Asia- Pacific
Butyraldehyde prices showed a mixed trend in the Asian market during the fourth week of December 2022. In China, during the first month of Q4, Butyraldehyde prices increased due to limited material availability and bullish demand from the downstream paints and coating along with allied industries. Furthermore, feedstock Propylene prices increased, resulting in the high production cost of Butyraldehyde in the domestic market. However, during the last two months of the quarter, Butyraldehyde prices dropped marginally due to the weak demand dynamics amid soft sentiment caused by the sluggish performance of the construction industry and covid lockdown. At the same time, ample product availability weighed down the prices of Butyraldehyde. Furthermore, manufacturing activity contracted in December. According to the National Bureau of Statistics, Purchasing Manufacturing Index dropped from 48 to 47 during December.
Europe
Prices of Butyraldehyde have witnessed mixed sentiments in the European market during the fourth quarter of 2022. During the first two months, prices have increased due to the high feedstock Propylene prices. In terms of domestic production, operating rates remained under check as energy prices continued to climb higher. The supply chains in the market were disrupted due to prolonged port congestions and vessel bunching, along with labor shortage which halted the supply flow of Butyraldehyde and, thus, limited the product availability in the regional market. Although, during the last month of the quarter, Butyraldehyde prices have dropped slightly due to the weak demand dynamics. The sharp decline in the freight rates, resulting in better imported material availability, weighed down the prices of Butyraldehyde. Meanwhile, demand from the downstream industries has continued to remain subdued due to the weak buying sentiments in the regional market.
For the Quarter Ending September 2022
North America
During the third quarter of 2022, Butyraldehyde prices showed mixed sentiments in the North American region. In the initial part of the third quarter, the Isobutylene price plunged around 2% owing to the weak cost pressure from the feedstock and sluggish demand from the downstream oxo-alcohol industries. However, during August and September, prices were rebound. Bullish sentiment in the feedstock, turmoil in the energy market, and a high inflation rate contributed to the high Butyraldehyde prices across the regional market. In addition, the US market has struggled with contradictory logistics, as interior rail hubs causing a container backlog at Long Beach port have affected the supply chain. Hence, as a result, Butyraldehyde's prices increased by around 2.6% during September 2022.
Asia – Pacific
Butyraldehyde prices showcased mixed trends in the Indian market during the third quarter of 2022. During July, prices of Butyraldehyde plunged by 1.4% as the cost pressure remained weak. Feedstock Propylene prices have decreased, which weighed down the Butyraldehyde to follow the downward trend. Sufficient inventory level and bearish demand from the downstream Oxo- alcohol industries. However, during the mid of Q3, prices slightly rebound due to the high feedstock Propylene prices. Demand from the downstream oxo-alcohol sectors has improved, although supply was not enough to cater to the overall demand. While during the end of Q3, Butyraldehyde prices decreased sharply due to the cheap imports from other Asian countries. Furthermore, consumption levels remained low in the Oxo-Alcohol industries. As a result, prices of Butyraldehyde CFR JNPT were assessed at USD 2489/MT during September.
Europe
Prices of Butyraldehyde showed fluctuation in the European market during the third quarter of 2022. During the initial and mid-Q3, Butyraldehyde prices declined due to the weak feedstock Propylene prices. Furthermore, sufficient inventory level coupled with weak demand from the downstream oxo-alcohol have remained weak, has another reason for the price drop in the regional market. However, during the end of the third quarter, Butyraldehyde prices gained upward momentum, supported by the high production cost amid surging natural gas prices. Furthermore, the speculation of recession across Europe has dampened the demand from the downstream industries. On the other hand, the supply chain was disrupted owing to the prolonged port congestion and vessel bunching coupled with a labor strike, which halted the supply flow of Butyraldehyde and limited the material available in the regional market. As a result, in Germany, prices of Butyraldehyde FOB Hamburg were assessed at USD 2480/MT during September.
The price trend of Butyraldehyde remained strong in the North American region, and prices rose throughout the quarter. In the H1 of the quarter, high petrochemical prices rose the feed Propylene costs sharply, due to which Butyraldehyde production costs soared in the region. However, in the mid-quarter, the feed costs stabilized, and Butyraldehyde costs rose marginally till the end of the quarter. The demand from Oxo-alcohol industries remained strong from the phthalate producer due to increased orders from the automotive manufacturers in the region, which contracted till the end of Q2 due to reduced automotive sales, and product offtakes remained firm throughout the Q2 from the domestic market.
During Q2 of 2022, the price of Butyraldehyde remained fluctuated. However, the price rose by almost 10% from quarter 1 of 2022. Most Asian countries were purchasing crude oil from OPEC except India and China. Due to this, petrochemical prices were uncertain in the region. Volatility in upstream naphtha and feed propylene costs post inflation, and crude oil imports from Russia impacted the petrochemical prices. Fuel and freight costs were oscillating too due to uncertainty in oil costs. The demand from Oxo alcohols industries for phthalate was strong at the beginning of the quarter but diminished slowly towards the quarter end, and offtakes remained moderate in Quarter 2.
Throughout the quarter, the price trend of Butyraldehyde remained steady, and Butyraldehyde prices rose consistently in the European region. At the beginning of Q2, petrochemical feedstock propylene prices rose sharply, which increased the product's production costs significantly. In the mid-quarter, the feedstock propylene and upstream Naphtha prices stabilized. However, energy and gas costs were firm in the region due to supply shortages of gas, keeping the Butyraldehyde costs on the higher side and raising the product's price marginally until the end of the quarter. The demand from downstream Oxo-alcohol producers remained modest, with average product offtakes from the regional market.
