For the Quarter Ending December 2022
Europe and North America's C9 Solvent markets both experienced the same pattern in the Fourth quarter of 2022. Upstream production was constrained by the average demand for this commodity from partners further downstream. The rubber, coating, and paint industries could meet their production needs because this product was readily available in inventories. The moderate demand for the product from other businesses downstream also affected its prices. The cost of upstream crude oil decreased as well, resulting in a significant decrease in this product's price.
During this quarter, the market for C9 solvent decreased across the entire Asia-Pacific region. There are numerous reasons why this product's price has decreased in China. The provincial governments' implementation of Covid-19 curbs and the downfall of the crude oil market, both of which contributed to the decline in upstream crude oil prices, were the primary contributors to the price drop. Additionally, businesses that use C9 solvent in paints and rubber had to reduce their production rates due to average demand significantly. India's market for C9 solvent in this quarter was comparable to China's. The average demand for this product from downstream industries and the product's ample inventory availability, which satisfied downstream companies' demands for the production of their end products, both had an impact on its price.
During this quarter, the market for C9 solvent in Europe decreased. Natural gas and energy prices significantly increased up until the second week of December as a result of the ongoing conflict between Russia and Ukraine. Consequently, downstream businesses showed average interest in this product despite their extreme concern. In Germany and the Netherlands, the market for C9 solvent followed similar trends. This product's price decreased in Germany as well as in the Netherlands this quarter due to the same factors. As a consequence of this, upstream businesses across Europe have been sustaining moderate production rates.
For the Quarter Ending September 2022
This quarter, the C9 solvent markets in North America and Europe both experienced the same trend. The summer break slowed down production, resulting in a shortage of workers. As a result, manufacturers of automobiles and elastics were forced to limit their production and reduce their manufacturing activities. The product's prices, which were influenced by the decrease in costs of upstream crude oil, were also influenced by the moderate demand for this product from businesses downstream.
The market for C9 solvent experienced a decline across the entire Asia-Pacific region at the beginning of this quarter, but it eventually recovered. The price of this product has gone down in China for several reasons. The primary factors that contributed to the price reduction in the early days of this quarter were the Asian crude oil market recession, which resulted in a decrease in upstream crude oil prices, and the implementation of lockdowns by provincial governments. Due to severe power shortages, C9 solvent-using businesses in the automotive, paint, and elastics industries were also forced to halt or significantly reduce their production rates completely. However, prices began to rise on July 1 because of increased demand for this product for downstream processing. During this quarter, India's market for C9 solvent was comparable to China's. The price of this product was affected by the increased demand for it from downstream industries to meet the festive demands for their end products. This product closed its market in India this quarter at USD 1,550 per MT on an ex-Dahej basis.
The market for C9 solvent declined in Europe during this quarter. Production and energy costs were significantly impacted by the limited supply of natural gas and crude oil brought on by the ongoing conflict between Russia and Ukraine. Consequently, despite their extreme concern, downstream businesses showed only passing interest in this product. The market for C9 solvents in Germany and the Netherlands followed similar trends. The same factors that reduced the price of this product in the Netherlands this quarter also contributed to the price drop in Germany this quarter.
For the Quarter Ending June 2022
The stable demand for the C9 Solvent from downstream agrochemicals, surfactants, emulsifiers, disinfectants, and other enterprises in the North American region caused the product's prices to be steady. Due to the ongoing war between Russia and Ukraine, Varying freight charges in the area supported the price trend. Constant prices of upstream feedstock Asphalt Residue due to the ongoing battle between Russia and Ukraine helped the price in the regional market with the traders. Logistical constraints affected the shipment and transportation, thus impacting the trade. The fluctuations in the global petrochemicals market affected the downstream market sentiments during the quarter, and the inventories were observed to be steady.
The prices of C9 Solvent surged in the Asian market during the second quarter of 2022 with a quarterly escalation of 5% in India, as recorded by Chem Analyst pricing team data. Surging product demand from downstream coatings, paintings, agrochemicals, surfactants, and automotive sectors supported the market upward. Escalation in the global freight charges due to the ongoing war between Russia and Ukraine put cost pressure on the product's prices in the regional market. The favorable crude oil price continued to support the fundamentals of the domestic asphalt market. At the same time, both the North and the South fell into supply shortages and intensely expanding demand. Due to tight supply, the sentiment of downstream supply is increasing. Road construction is gradually returning to normal as the weather improves, and requests will also be more open.
During the first week of June, C9 Solvent prices in Europe saw steady market trends. Local traders were hesitant as inflation, and Ukraine's situation increased. Additionally, shipping costs skyrocketed, further confusing them. After the Energy Information Administration announced an inventory drop of 5.1 million barrels for the week ending in May, crude oil prices increased even further. The inventories were stable, and market sentiments were in a wait-and-see mode with steady downstream demand. Reduced downstream demand on the domestic market contributed to the price reduction. The need for C9 Solvent has been significantly impacted by rising upstream crude prices and the region's ongoing, escalating geopolitical unrest. This quarter, it seemed like the traders were waiting and watching.