For the Quarter Ending March 2024
North America
Throughout the quarter, the North American Cyclopentane market witnessed a bullish trajectory, driven by a confluence of factors contributing to a notable price surge. Chief among these factors was a scarcity of materials within the market, exacerbated by high production rates.
Additionally, the escalating prices of essential raw materials such as Benzene and Crude Oil prompted an uptick in production rates and energy costs, exerting upward pressure on Cyclopentane prices. The resurgence of demand from downstream refrigerant and blower industries, in anticipation of the impending summer season, further fuelled market momentum, although initial expectations were not fully met.
Notably, March saw a pronounced surge in demand from the Asian refrigerant market, particularly from key players such as India and South Korea, driving prices upwards in the exporting powerhouse of the USA. This scenario underscores the complex interplay of supply and demand dynamics, as well as external market forces, shaping the North American Cyclopentane landscape. As such, prudent market monitoring and strategic decision-making are imperative for stakeholders navigating this dynamic market environment.
APAC
In the dynamic landscape of the Asian Cyclopentane market, the Quarter unfolded with notable price fluctuations, notably impacting India and China. Prices experienced a marginal surge during the initial and final months of the quarter, reflecting a nuanced interplay of supply and demand forces. In January, China witnessed a price escalation of 1.3% from December 2023, attributable to a scarcity of materials within the market. Moreover, the resurgence of demand from downstream refrigerant and blower industries, in anticipation of the approaching summer season, lent momentum to market activities, albeit not meeting initial expectations. March witnessed a steadfast demand surge from the Asian refrigerant market, notably emanating from India and South Korea, propelling prices upwards in exporting powerhouse China. Conversely, February saw a subdued demand scenario within domestic and other importing Asian markets, as consumer focus shifted towards Lunar New Year festivities. Concurrently, China faced a production slowdown, exacerbating material scarcity within the market, albeit without immediate price repercussions. However, the culmination of this scarcity, coupled with a modest demand revision in March, defined a widened gap between demand and supply dynamics, thereby bolstering the subsequent price surge. As of now the latest FOB price of Cyclopentane at Qingdao port was recorded to be USD 1550/MT.
Europe
Throughout the quarter, the European Cyclopentane market witnessed a bullish trajectory, driven by a confluence of factors contributing to a notable price surge. Chief among these factors was a scarcity of materials within the market, exacerbated by high production rates. Additionally, the escalating prices of essential raw materials such as Benzene and Crude Oil prompted an uptick in production rates and energy costs, exerting upward pressure on Cyclopentane prices. The resurgence of demand from downstream refrigerant and blower industries, in anticipation of the impending summer season, further fuelled market momentum, although initial expectations were not fully met. Notably, March saw a pronounced surge in demand from the Asian refrigerant market, particularly from key players such as India and South Korea, driving prices upwards in the exporting powerhouse of the Europe. This scenario underscores the complex interplay of supply and demand dynamics, as well as external market forces, shaping the European Cyclopentane landscape. As such, prudent market monitoring and strategic decision-making are imperative for stakeholders navigating this dynamic market environment.
For the Quarter Ending December 2023
North America
In the final quarter of 2023, the North American Cyclopentane market encountered a combination of challenges and opportunities. Initially, there was a positive market sentiment driven by a Cyclopentane supply shortage and increased global demand from the refrigerant sector.
International demand, particularly from the Indian market, remained strong due to the upcoming festive season. However, as November progressed, North American Cyclopentane prices started to decline. The drop in prices was influenced by the decrease in the cost of essential raw materials such as Benzene and Crude Oil, leading to reduced production rates and lower energy costs in the country. Additionally, a rise in Cyclopentane inventories in the region contributed to the downward pressure on prices.
Persistent drought conditions in the Panama Canal and Maersk's decision to reroute vessels away from Red Sea routes, opting for navigation around Africa's Cape of Good Hope due to rebel attacks in the Red Sea, significantly increased tonne-miles. These strategic changes posed a multifaceted challenge for global trade, resulting in a surge in inventories at ports. The redirection of shipping routes and the subsequent increase in tonne-miles further complicated the dynamics influencing the Cyclopentane market, reinforcing an overall bearish trend during this period. Moreover, during this timeframe, demand from the domestic refrigerant market remained subdued as the peak seasonal demand had already passed. The intricate interplay of these factors led to a narrowed gap between demand and supply in the North American Cyclopentane market.
APAC
In Q4 2023, Cyclopentane pricing in the APAC region exhibited a mixed trend. Initially, prices declined due to subdued demand, but as the quarter progressed, a shortage of Cyclopentane supplies in China, coupled with renewed global demand from refrigerant sector, led to a price increase. Demand for Chinese Cyclopentane was firm from Indian refrigerant sector amidst forthcoming festive season. Further, as December unfolded heightened shipping rates from China, driven by trade uncertainties and Red Sea ship attacks, particularly impacted Cyclopentane prices in Asia, with China experiencing the most significant effects. Ongoing Red Sea ship attacks escalated ocean freight rates, raising concerns about inflation and delayed goods. Carriers, in an effort to avoid strikes by Iran-backed Houthi militants in Yemen, diverted trade away from the crucial Middle East route, connecting the Mediterranean Sea to the Indian Ocean. This created a multi-front storm for global trade, resulting in increased transportation costs. To safeguard profit margins, traders elevated prices for various commodities, including Cyclopentane. Notably, China's export container shipping price index rose by 2.3 percent month-on-month in December 2023, as reported by the Shanghai Shipping Exchange.
Europe
In the European region, the Cyclopentane market exhibited bearish trends throughout the final quarter of 2023, reaching a culmination in December. This downturn was primarily driven by a decline in demand for Cyclopentane within both domestic and international refrigerant markets. The extended downturn in global crude oil prices further exacerbated these challenges. Declining price of essential raw material Benzene and Crude Oil prompted towards reduced production rates and energy cost thus exerting downward cost pressure on Cyclopentane prices. Further, the imposition of sanctions on Venezuelan Crude oil sales and exports played a role in influencing the global crude oil value, providing some relief to downstream industries. As the quarter unfolded, attacks on Red Sea trade by Yemeni rebels heightened concerns about the safety of maritime traffic in the region, leading to disruptions in Red Sea trade. These disruptions are anticipated to have a significant impact on global supplies of various commodities, including Cyclopentane. Shippers responded by imposing additional fees amidst the trade disruption in the Red Sea, prompting Asian consumers to exhibit hesitancy in making bulk purchases. Consequently, this situation has led to a notable increase in inventories within the European market. The intricate interplay of these factors contributed to a narrowed gap between demand and supply, reinforcing the overall downturn in the Cyclopentane market.
For the Quarter Ending September 2023
North America
In the North American region, the Cyclopentane market displayed a mix of trends during the third quarter ending in September 2023. Prices saw an increase in the first two months but took a significant dip in September 2023. The upswing in prices during July and August can be attributed to a combination of factors, including robust demand driven by the seasonal needs of the domestic refrigerant industry during the summer season in July. Further, the increased prices of crucial upstream crude oil and high energy costs within the country led to increased production rates, consequently causing a rise in Cyclopentane prices. Furthermore, in August, supply chain constraints played a significant role in impacting Cyclopentane prices. The landfall of Hurricane Idalia in the Gulf Coast and Florida disrupted production activities, resulting in a shortage of material within the USA market. Notably, inquiries from the international market remained strong during this period. Data from the Bureau of Labor Statistics indicated that the Consumer Price Index of the country increased by 0.6% in August 2023, with a marginal 0.1% rise in the Natural Gas Index. However, in September, inquiries from the downstream industry remained consistent, with no new inquiries or bids from the international market. A decrease in demand, coupled with sufficient stocks, compelled traders to lower the price of the product.
APAC
The Asian Cyclopentane market displayed mixed sentiments during the third quarter ending in September 2023. Cyclopentane prices experienced a decline during the first and last months of the quarter but saw an increase in August 2023. The surge in prices in August can be attributed to robust demand from both residential and commercial refrigeration units. Major pharmaceutical and FMCG organizations have been selecting China as a location to establish R&D hubs, contributing to increased demand in the downstream industry of refrigerants and refrigerators. This increased demand was a primary driver of the price hike. Additionally, the uncertainty in the prices of upstream crude oil and benzene also played a role in driving up Cyclopentane prices and should not be underestimated. However, prices declined in July 2023 and September 2023 due to surplus availability of material in the market. Factors such as sluggish global economic growth, declining international trade and investment, geopolitical uncertainties, and diminishing external demand continue to impact China's trade dynamics significantly. The downstream demand exhibited signs of inadequacy, procurement practices adopted a more cautious approach, and market transactions primarily occurred at reduced price levels.
Europe
In the European Cyclopentane market, there was a positive price trend during the first two months of the third quarter. Conversely, in September 2023, prices experienced a significant decline. The earlier price increase was attributed to a combination of factors. Several market players reported product shortages in the German market due to reduced production rates. The summer season in July drove the seasonal demand from the domestic refrigerant industry. Additionally, price hikes were the result of product unavailability and an increased demand for exports to China, alongside a recovery in the refrigerant sector in the regional market. According to suppliers, the recent price increases in Cyclopentane were driven by supply bottlenecks, decreased production rates, and insufficient inventories to meet the growing demand in both the global and regional markets. However, during September, the shortage of Cyclopentane appeared to be easing, and prices surged to new heights. Nevertheless, according to market sources, after reaching these elevated levels, prices started to return to their normal values in early September 2023. In terms of demand, the market situation remained stable, with a modest resurgence in demand for Cyclopentane observed from the downstream blowing and refrigerant industries during the current week. International market demand, however, remained subdued.
For the Quarter Ending June 2023
North America
Cyclopentane prices have experienced a downturn in the North American region throughout the second quarter of 2023. The declining price of raw material Benzene and moderate demand from the refrigerator and insulating construction metals majorly contribute to the decreasing trend of Cyclopentane. Additionally, the collapse of two major banks in the USA has also influenced the current prevailing price trend. Further, growing inflationary pressure and the global economic downturn have caused the government to raise interest rates high. This has made consumers reluctant to make bulk purchases. As indicated by FRED, the Purchasing Managers Index of the country has depreciated from 248.16 in April 2023 to 245.3 in June 2023. However, the Consumer Price Index of the country rose by 0.3% in May. Further, OPEC-led Saudi Arabia declared at the beginning of this quarter that it would reduce oil output by 500 Mb/d for the rest of the year. This action from Saudi Arabia has also impacted the price of Cyclopentane globally. Overall, the market situation for Cyclopentane remained bearish throughout this quarter. Inflationary pressure and high-interest rates outweighed the reviving demand from the construction sector.
APAC
A surge in prices of Cyclopentane was observed at the beginning of this quarter in China market. This rise was initially influenced by some supply problems in the region. However, later the price plunged in the wake of weak demand from downstream refrigerant and other allied industries. The prices settled at USD 1420/MT on a FOB basis in China. Further, the construction sector a significant consumer of Cyclopentane is experiencing a downturn since the beginning of this quarter on the back of weaker than expected property sector. Further, in an effort to curb inflationary pressure in the region, the Asian government has raised interest rates high. This has further weakened the buying enthusiasm of consumers. Additionally, OPEC-led Saudi Arabia declared at the beginning of this quarter that it would reduce oil output by 500 Mb/d for the rest of the year. This action from Saudi Arabia has also impacted the price of Cyclopentane globally. As indicated by the National Bureau of Statistics China, the Purchasing Manager Index is declining and has been recorded at 48.8 in May 2023 after a marginal decline of 0.8% from the previous month along with a decrease in industrial growth rate from 5.6 in April 2023 to 3.5 in May 2023. These declining economic indicators hinted towards reduced economic activity, potentially affecting Cyclopentane demand.
Europe
Pessimistic market sentiments for Cyclopentane prevail throughout the second quarter of 2023 in the European region. Sluggish demand from the end-user refrigerant, construction, and automotive sector influenced the declining price of the material. Further, amidst growing inflation and economic downturn consumers were hesitant in making bulk purchases. However, a sufficient amount of material was available in the European market. This coupled with depreciating demand paved the way for narrowed demand supply gaps. Inflation in Germany has slowed down to 5.6% in June from 6.1% in May but is still above the average level. Further, as per data from the German Federal Statistical Office, the Consumers Price Index declined by 0.1% in May from the previous month. Additionally, as per data from Eurostat, the Producers’ Price Index of the region declined to 138.3 in May from 143.4 in March and is expected to decline further. The average decline was 3.6%. These declining economic indicators hinted towards reduced economic activity, potentially affecting Cyclopentane demand.
For the Quarter Ending March 2023
North America
The price of Cyclopentane has been fluctuating throughout the first quarter of 2023 in the US market. Due to sluggish orders from the construction and automobile industries, the price leveled out in the market. A high supply of upstream crude oil from the manufacturers and coupled with lower prices, further supported the downstream derivative markets. At the conclusion of the first quarter, new export orders had fallen for ten straight months as circumstances for overseas customer demand remained historically dismal. Market participants assert that new orders have fallen in the US market and that the demand for downstream insulating construction material, refrigerators, and other key driving factors has been low to stable.
Asia
Throughout the first quarter of 2023, the price of Cyclopentane in the Asian market showed a mixed price pattern. After the Lunar holidays, the cost of Cyclopentane saw an upward tick due to high inquiries, and the price of feedstock Benzene rose in the Chinese market. Feedstock Benzene prices inclined in China due to amid increase in the market trading activities after the spring day festival because of an increase in demand from the downstream industries and the availability of stable product inventory levels in the market. On the other hand, India has also followed the declining price trend as the upstream crude oil value decreased in the country. As per the market participants in the domestic market, demand has stable to weak, and there were limited occurrences of new orders inquired by the end-users, which resulted in bearishness in pricing sentiment.
Europe
The price of Cyclopentane fell in Europe throughout the first quarter of 2023 due to consistent supply and sufficient availability in the market. The feedstock Cyclohexane and upstream crude oil values declined and supported the petrochemical derivative markets. In addition, the latest indication that Europe has avoided the dreaded energy crisis is that natural gas prices have fallen to their lowest level in years. German exports are negatively impacted by the weak global economy while rising inflation rates negatively impact consumer spending and other commercial trading by lowering purchasing activity and sharply raising borrowing costs.
For the Quarter Ending December 2022
North America
In the quarter that ended in 2022, the price of Cyclopentane went up for the first two months, then fell in North America. The feedstock Cyclohexane showed higher value which led to the downstream derivatives in the USA market. Due to the high inflation rate and high-interest rates in the United States, the prices of petrochemical products increased during Q4. The demand from the downstream industries like Polyurethane resins and synthetic adhesives was weaker in the US market. The holiday approached in the last month of quarter four, further pressured demand and orders from the buyers. In addition, in the face of inflation, domestic consumers tended to wait and buy.
APAC
The price of Cyclopentane gradually decreased throughout quarter 4 of 2022. The feedstock Cyclohexane price fluctuated in Asia, leading the downstream derivatives to follow a similar path in the regional market. In China, the demand from the downstream Polyurethane resins and adhesives industries declined in the market. To keep COVID cases under control, the Chinese government implemented a Zero COVID policy, which slowed trading and reduced orders from end-use industries. The production rate also decreased in some enterprises due to low demand from the end-use industries and consumers. The overall demand was just the basis of need, and the market saw a wait-n-see attitude during December 2022.
Europe
During the fourth quarter of 2022, the price of Cyclopentane decreased in Europe. As a result of low demand, the manufacturers have reduced the production rate of Cyclopentane. The weak-cost pressure from feedstock Cyclohexane further decreased the price trend towards the negative direction in the European market. Demand has been severely weakened in Europe by the economic downturn and fear of recession. Most consumers were pessimistic about the region’s economy during quarter 4. The supply has been eased, and the port congestion has been improved in Europe. During December, the manufacturers were selling their products at an offered price due to year-end destocking sales across Europe.
For the Quarter Ending September 2022
North America
The price of Cyclopentane observed declined in North America throughout the third quarter of 2022. Weak cost pressure from feedstock Cyclohexane contributes to the price movement of Cyclopentane in the region. Demand from the downstream refrigerator industry was weak, and poor purchasing orders from consumers decreased the negative price trend. The high inventory from the traders constrained the price of Cyclopentane. The high rate of inflation has dampened demand from the Cyclopentane industries. At the same time, orders from the overseas market remained weak due to consumer sentiment uncertainty.
APAC
In the Asia Pacific, the Cyclopentane price saw mixed sentiments throughout the third quarter of 2022. The weak cost pressure from the upstream Cyclohexane supported the price of Cyclopentane in the Chinese domestic market. Weak demand from the downstream industries and sufficient supply from the traders. In India, the price decreased in September due to high consumption from the end-use industries like refrigerators due to the festive season in the upcoming months. The more inquiry about the product and high orders, traders raised the price of Cyclopentane in the Indian market. The cost of Cyclopentane hovered around USD 1682/MT on a FOB Shanghai basis during the quarter ending.
Europe
During the third quarter of 2022, the price of Cyclopentane fluctuated in the European market throughout Q3. The weak demand from the downstream industries and stagnant consumer orders curbed the price movement. The inventory level from the manufacturers was high, and there was abundant availability of the product in the market. However, the natural gas prices were high, but the cost of Cyclopentane declined due to weak market sentiments. The consumers were reluctant to buy a product due to high natural gas prices and other commodities prices increasing in the region.
