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.