For the Quarter Ending September 2024
North America
In Q3 2024, the North American region faced significant challenges in Cellulose Ether pricing, resulting in a notable decline in market prices. Several factors contributed to this downturn, including weak demand from key sectors like construction and coatings amid ongoing economic uncertainties. Supply chain disruptions, including plant shutdowns and reduced production capacities, also affected pricing dynamics. Overall, market sentiment remained negative, with prices consistently trending downward.
In August 2024, production encountered additional hurdles due to limited availability of propylene oxide following an unplanned shutdown at Nova Chemicals in late July, which caused a nearly 1% increase in prices and raised production costs. Moreover, a labor dispute in Canada involving Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC) led to the lockout of over 9,000 workers, further constraining the supply of cellulose feedstock and resulting in moderate Cellulose Ether production across the U.S.
In the United States, prices experienced the most significant fluctuations, dropping by 14% compared to the same quarter last year. A quarter-on-quarter decrease of 1% highlighted ongoing pricing pressures, while a 3% drop from the first half to the second half of the quarter indicated a deteriorating pricing environment as the quarter progressed. By the end of the quarter, the price of Cellulose Ether (CMC) reached USD 3,830/MT FOB Texas, reflecting the prevailing downward trend in pricing and the challenging market conditions affecting demand across the region.
APAC
In Q3 2024, the Cellulose Ether market in the APAC region experienced a period of declining prices, with notable impacts on the market dynamics. Several factors influenced this trend, including subdued demand from various industries, particularly the construction sector, which faced liquidity challenges. Additionally, seasonal factors like the monsoon season dampened construction activities, further reducing the need for Cellulose Ether. These conditions led to a decrease in prices, with China seeing the most significant fluctuations. China, being a key player in the market, experienced a -13% price change from the same quarter last year, indicative of the prolonged downward trend. Within Q3 2024, there was a -5% change from the previous quarter and a -2% decline between the first and second halves of the quarter. The latest recorded price for Cellulose Ether HEC(80000-100000) Grade FOB Qingdao in China stood at USD 4700/MT, reflecting the overall negative pricing environment characterized by stability. These trends underscore the challenging market conditions and the persistent struggle with low demand and pricing pressures in the Cellulose Ether sector.
Europe
In the Europe region during Q3 2024, the Cellulose Ether pricing landscape witnessed a period of declining prices, heavily influenced by multiple factors. The market for Cellulose Ether experienced a challenging quarter, with significant price decreases driven by weak demand conditions and reduced production costs. The downturn in the construction sector played a pivotal role, leading to low demand for the product. Additionally, the stability in prices can be attributed to moderate supplies and limited availability of feedstock Propylene Oxide. Across the region, the overall trend indicated a bearish sentiment, with prices decreasing by 2% compared to the same quarter last year. Germany saw the most significant price changes, with prices dropping by 4% between the first and second half of the quarter. The market in Germany reflected a negative sentiment, with prices ending the quarter at USD 3760/MT of Cellulose Ether (CMC) FOB Hamburg. The correlation in price changes highlighted a stable to bearish market situation, with demand remaining low and suppliers maintaining low inventories. The quarter concluded with a clear indication of decreasing prices, aligning with the overall negative pricing environment seen throughout the period.
For the Quarter Ending June 2024
North America
In Q2 2024, the North American Cellulose Ether market maintained stable pricing amidst a combination of factors that fostered a balanced environment. Stable production costs, with minimal fluctuations in feedstock Propylene Oxide prices, played a crucial role in steadying Cellulose Ether prices. Adequate supply levels also contributed significantly, ensuring prices remained steady without significant swings. Moderate demand from downstream sectors like coatings and construction, reflecting a slowdown in construction spending, further bolstered this stability. Within the USA, where the most significant price variations were observed, the overall trend remained steady despite seasonal influences. The construction sector's downturn tempered demand, though some optimism arose from declining mortgage rates and improved housing completions, which provided slight support to the market. Comparing Q2 2024 to the same period last year, prices for Cellulose Ether declined by 7%, indicating a notable decrease, while the quarterly change from the previous quarter showed a moderated depreciation trend at -3%. Notably, there was little price differentiation between the first and second halves of the quarter, emphasizing the consistent and stable market sentiment. Closing Q2 2024, Cellulose Ether (CMC) was priced at USD 4130/MT FOB Texas in the USA. This pricing stability underscores a balanced market environment—neither excessively positive nor negative but characterized by reliability. It reflects a harmonious interplay of stable supply, modest demand improvements, and controlled production costs, fostering a steady pricing landscape for Cellulose Ether across the region.
APAC
In Q2 2024, the Cellulose Ether market in the APAC region faced a strong bearish trend, driven by a combination of adverse economic and industrial conditions. Throughout the quarter, several key factors contributed to the decline in Cellulose Ether prices. The primary driver was sluggish demand from the construction sector, which dampened purchasing sentiment across downstream industries, especially in coatings. Additionally, logistical challenges such as port congestion and soaring global shipping costs worsened market oversupply, making destocking efforts difficult for suppliers. China, experiencing the most significant price fluctuations, reflected an ongoing downward trend. Seasonal factors, including reduced construction activity after holidays and the onset of the rainy season, further depressed the market. Price trends in Q2 2024 showed a continuous decline, with a notable 12% drop compared to the same quarter the previous year and a 2% decrease from the preceding quarter. The latter half of the quarter saw an additional 2% decline compared to the first half, highlighting persistent negative sentiment. By quarter-end, Cellulose Ether HEC (80000-100000) Grade FOB Qingdao was priced at USD 4900/MT, marking a significant decrease indicative of a challenging pricing environment. This downturn was driven by weak demand, seasonal fluctuations, and logistical bottlenecks. Consequently, Q2 2024 posed formidable challenges for the Cellulose Ether market in APAC, with China navigating the forefront of these adverse trends.
Europe
In the second quarter of 2024, the European Cellulose Ether market has shown a diverse yet increasingly positive pricing trend. Key factors shaping market dynamics include heightened secondary demand from the FMCG sector and favourable conditions in the beverage industry downstream. While internal supply chain disruptions and a slight decline in Propylene Oxide prices (around 1%) applied downward pressure, the overall balance of supply and demand maintained a bullish sentiment. Germany, notably, experienced significant price fluctuations within the region. The market here was influenced by seasonal demand shifts and increased manufacturing activities, which offset some earlier contractions. Despite challenges in the coating and construction sectors, prices in Germany managed to stabilize, showing no change quarter-on-quarter compared to the same period last year and a 2% decrease from the previous quarter of 2024. The first half of the quarter saw prices rise by 1% compared to the second half, reflecting a stable demand-supply landscape. By the end of the quarter, Cellulose Ether (CMC) was priced at USD 4000/MT FOB Hamburg, indicating a moderately stable market. Despite supply chain disruptions and reduced primary demand from coatings, Germany's retail sector improvement and increased FMCG demand helped maintain price stability. Overall, while facing various influences, the German market retained a stable sentiment, suggesting cautious optimism for the year ahead.
For the Quarter Ending March 2024
North America
During the first quarter of 2024, the North American Cellulose Ether market experienced a predominantly negative trend. Overall, product prices depreciated by around 1.5%, driven by increased production levels and limited exports to international markets.
Despite a rise of approximately 3.5% in feedstock prices for Propylene Oxide, the subdued construction sectors in Asian and European importing markets largely influenced the US Cellulose Ether market. Additionally, challenges at key waterways, such as droughts at the Panama Canal and the ongoing crisis in the Red Sea, hindered North American suppliers from exporting to European and Asian markets respectively.
Elevated freight costs further dampened export orders throughout the quarter. The downturn in China's construction sector, characterized by liquidity issues among real estate developers leading to halted construction activities and inventory procurement delays, contributed to the decline in the export US Cellulose Ether market. Slow restocking activities in Asia resulted in product stockpiling at US ports, preventing any positive movement in the North American Cellulose Ether market.
Asia
During the initial quarter of 2024, Cellulose Ether prices in the Asian market experienced an overall decrease of about 0.5 percent. Notably, there was no support from the feedstock Propylene Oxide (PO), which depreciated by around 8 percent during this period. The principal driver behind the downturn in the Asian Cellulose Ether market was the persistent decline in the construction sector, marked by reductions in residential starts and public construction orders. Additionally, many construction firms faced heightened input costs, leading to project deadline extensions, decreased initiation of new projects, and inventory postponements. Consequently, stockpiling occurred, prompting suppliers to reduce product prices. Following the Chinese Lunar New Year festivities, restocking conditions were sluggish, with restocking efforts limited to essential needs. Export conditions remained unfavorable due to ongoing crises at the Red Sea and droughts conditions at the Panama Canal. Moreover, adverse weather conditions at major ports such as Shanghai continued to disrupt operations, resulting in delayed departures to other importing nations.
Europe
During the first quarter of 2024, the European Cellulose Ether market experienced a blend of sentiments. Initially, there was a 2% increase in product prices, which was followed by a subsequent decline of approximately 2% later in the quarter. Initially, rising prices of the feedstock Propylene Oxide, up by around 6% during this period, drove the European Cellulose Ether market, leading to increased production costs. However, demand from downstream coating industries continued to weaken due to the sluggish construction sector, which began affecting the market midway through the quarter. The downturn in the construction sector, particularly evident in Germany, where permits and construction projects declined, drove Cellulose Ether prices. Real estate firms remained pessimistic throughout the year, with investment sentiments historically negative, and contractions observed across all segments of the construction sector—residential, commercial building, and civil engineering activities. However, during the middle of the first quarter, the European Cellulose Ether market saw some demand-side support from improving conditions in the British, Dutch, and Belgian markets. Despite this, it was insufficient to alter the prevailing market situation. Furthermore, challenges in the existing supply chain, including strikes by union workers leading to limited railway functionality and transportation and logistics constraints, also contributed to price increases.
For the Quarter Ending December 2023
North America
During the challenging fourth quarter of 2023, the North American Cellulose Ether market encountered significant obstacles driven by three primary factors.
Firstly, the demand for Cellulose Ether remained low in both domestic and international markets, attributed to a slowdown in the construction industry. This decline was influenced by high labor costs, escalating material prices, and the onset of the winter lull. Secondly, the market witnessed ample product availability, ensuring stable supplies throughout the quarter. Finally, market sentiment stayed bearish, resulting in a 4% decline in prices.
However, a positive shift occurred in the middle of the fourth quarter, driven by seasonal demand from the automotive sector and preparations for restocking activities associated with Christmas and the winter season. This induced optimism among traders, anticipating high demand from the downstream FMCG sector. In summary, the North American Cellulose Ether market faced challenges in Q4 2023, marked by low demand, stable supplies, and a bearish market sentiment. The USA experienced pricing fluctuations throughout the quarter, with no significant overall change. The latest price for Cellulose Ether (CMC) FOB Texas in the USA for the current quarter stands at USD 4202/MT.
APAC
In Q4 2023, Cellulose Ether pricing in the APAC region exhibited stability amid moderate demand and consistent supplies, with minor weekly price adjustments. The market maintained equilibrium, and supplies remained steady throughout this period. The key factors influencing the market included a narrowed demand-supply gap, a post-festive relaxation in market dynamics, and subdued overseas sales. Notably, China experienced significant price fluctuations, witnessing a 0.8% increase in November and a subsequent 2% decline in January. The trend for Cellulose Ether in China was negative, with a projected 2.3% decline in December 2023. No substantial seasonality was evident, and the correlation price percentage was deemed moderate. Both the percentage change from Q4 2022 and the change from the previous quarter remained constant at 0%. The quarter-ending price for Cellulose Ether HEC (80000-100000) Grade FOB Qingdao in China stood at USD 5180/MT. Overall, the market maintained stability with minor price adjustments, and the negative trend in China was attributed to a narrow demand-supply gap and sluggish overseas sales.
Europe
In the European market, Cellulose Ether prices initially experienced a bearish trend, marked by a nearly 3% depreciation. However, a recovery of around 6% was noted during October and November. The primary demand from the downstream construction sector was notably low, which was attributed to declining building permits and downturns across all three segments of the construction industry. Conversely, demand from the secondary FMCG sector exhibited strength, with traders anticipating heightened demand due to improved purchasing activities. The increasing costs of one of the raw material Propylene Oxide also played a role in enhancing the market situation by raising production costs. Despite these improvements, the primary demand from the construction sector persisted in retrenchment for the thirteenth consecutive month. Housebuilding remained the weakest performing segment of the construction industry, with subcontractor availability easing for the eighth consecutive month. Overall, demand conditions remained highly unfavorable, marked by an all-time low in investment confidence and continued job shedding throughout the fourth quarter of 2023.
