For the Quarter Ending March 2025
North America
During the first quarter of 2025, the U.S. Diacetone Alcohol market experienced a consistent upward trend in prices with the quarter ending prices standing at USD 2353/MT on month-on-month basis, primarily driven by significant supply-side constraints. Extended periods of freezing temperatures across major production hubs disrupted manufacturing activities, resulting in operational slowdowns and logistical setbacks. These adverse weather conditions significantly reduced DAA output and strained supply chains, leading to tight market availability.
Compounding the domestic supply issues, import volumes provided limited relief, as international shipments continued to face delays due to persistent global logistical bottlenecks. These factors collectively intensified the supply pressure within the U.S. market. On the demand side, activity from the construction sector, the key downstream consumer of DAA for applications in coatings, resins, and adhesives—remained stable.
According to official data, U.S. construction spending increased by 2.9% year-on-year in February, with private construction investment rising 0.9% and residential construction advancing 1.3%, including a 1.0% increase in spending on new single-family housing. The combination of resilient demand, constrained supply, and elevated production costs contributed to sustained price escalation across the market throughout the quarter.
APAC
During the first quarter of 2025, the Asian Diacetone Alcohol (DAA) market displayed divergent regional trends, with China and India experiencing notably different pricing dynamics. In China, DAA prices surged significantly, with the quarter-ending price reaching approximately USD 1610/MT, marking a strong month-on-month increase. This upward momentum was primarily driven by a persistent supply-demand imbalance. A key factor contributing to the supply shortage was the extended shutdown of Sinopec Beijing Yanshan Petrochemical, a major domestic producer, which has remained non-operational since late 2024. The constrained availability of feedstock further exacerbated the tight supply situation. On the demand front, while domestic consumption was steady, international interest in Chinese DAA remained modest, supported by optimistic projections for substantial investment in the country’s construction sector, which in turn bolstered market sentiment. In contrast, the Indian market witnessed relatively subdued pricing throughout the quarter. Despite moderate inquiries from downstream industries, DAA prices remained at the lower end. Traders in India reportedly kept offers competitive in an attempt to stimulate demand and attract higher purchase volumes, thereby preventing any significant price escalation.
Europe
During the first quarter of 2025, the European Diacetone Alcohol (DAA) market experienced considerable price volatility, with Germany emerging as one of the most significantly affected regions. In the early part of the quarter, DAA prices declined, primarily due to subdued demand from the construction sector, a major downstream consumer of DAA, particularly in the production of paints, coatings, and resins. Germany’s construction industry continued to grapple with structural challenges, including elevated financing costs, a persistent shortage of skilled labor, and administrative inefficiencies. These issues dampened construction activity across the country, leading to reduced demand for construction materials, including DAA. However, as the quarter progressed, the market witnessed a shift in sentiment. Despite continued headwinds, DAA prices began to rise in the latter half of the quarter. This reversal was supported by tightening supply conditions and modest restocking activity among downstream consumers. Consequently, the European DAA market closed the quarter on a firmer note, reflecting a recovery in pricing momentum amid lingering uncertainties in the construction sector.
For the Quarter Ending December 2024
North America
The North American Diacetone Alcohol (DAA) market experienced a notable price surge during the final quarter of 2024. This upward price movement can be attributed to a combination of factors, including a shortage of domestically produced material and strong demand from the downstream paints and coatings industry.
In the initial months of the quarter, production in the region was hampered by adverse weather conditions, including hurricanes and heavy downpours, which led to frequent power outages and disruptions. However, as the quarter progressed, the supply situation began to ease, allowing for a stabilization in production levels.
On the demand side, purchasing activity from the downstream construction sector remained relatively modest. Data from the U.S. construction market revealed a 0% change in construction spending in November 2024 compared to the previous month, following an increase in October. This subdued demand from construction, combined with supply constraints, contributed to the price surge in the DAA market, though growth was tempered by slower expansion in certain sectors.
Asia-Pacific
The Asian Diacetone Alcohol (DAA) market experienced bullish price trends during the final quarter of 2024, primarily driven by firm demand in the Chinese market. Demand for DAA remained moderately steady, with the paints and coatings sector, a key end-user industry, showing mixed performance. This limited the overall market recovery, as the sector's consumption fluctuated during the quarter. China's economic growth for 2024 stood at 5%, meeting government targets; however, this growth was uneven, as many citizens reported declining living standards. This highlighted Beijing's challenges in distributing industrial and export gains to domestic consumers. The Real estate sector data showed some stabilization, with December’s 70-city property price index revealing slower declines in home prices. New home prices dropped by 0.08%, and existing home prices fell by 0.31%, marking the fourth consecutive month of moderated declines. The surplus availability of DAA was further exacerbated by global port congestion and ongoing trade uncertainties, which disrupted supply chains and contributed to market volatility.
Europe
The European Diacetone Alcohol (DAA) market remained stable with only minor fluctuations during the final quarter of 2024. Demand from the key downstream construction sector remained subdued, particularly as Germany, one of Europe's largest construction markets, experienced a deeper downturn in October, November, and December. This downturn was reflected in a decline in both activity and new orders, driven by broader economic pressures and reduced investment in construction projects across the region. The muted demand from the construction industry contributed to the lack of upward momentum in DAA prices, which remained relatively stable throughout the quarter. Market participants reported that construction activity in December 2024 faced significant challenges. Despite slight increases in some construction activity indexes, they remained well below growth levels, marking several months of contraction. Housing activity saw its sharpest decline since September, while the commercial and civil engineering sectors showed slower but still negative growth. Germany and France continued to face difficulties, with France reporting its most significant contraction since April, leading to notable job cuts in the sector.
For the Quarter Ending September 2024
North America
In Q3 2024, the North American Diacetone Alcohol (DAA) market exhibited stable pricing, despite facing several market challenges. The primary factor contributing to this stability was the equilibrium between supply and demand. Although demand from key downstream sectors, particularly paints, coatings, and adhesives, experienced some fluctuations during the quarter, overall consumption levels remained steady, preventing any major price shifts.
On the supply side, consistent production rates from manufacturing facilities helped ensure an adequate and uninterrupted flow of DAA into the market. This stable supply situation counterbalanced the periodic dips in demand, fostering a relatively balanced market environment. Additionally, despite some upward pressures from fluctuating raw material costs and logistical challenges, such as transportation delays and rising freight charges, these factors did not significantly impact the overall pricing landscape.
As the quarter drew to a close, the price of Diacetone Alcohol remained steady at USD 2266/MT DEL Louisiana in the USA. This stability underscores the market's resilience and ability to maintain balance between supply and demand, positioning DAA pricing within a stable and predictable range throughout the third quarter of 2024.
APAC
In Q3 2024, the Diacetone Alcohol (DAA) market in the APAC region experienced a notable decline in prices, driven by a combination of economic and environmental factors. A primary contributor to this downward trend was the consistent drop in feedstock prices, which reduced production costs across the region. Additionally, sluggish production rates further compounded the pricing pressure, as manufacturers adjusted output in response to lower demand from key downstream industries like automotive and construction. China, being the most affected region, saw a significant impact on DAA prices. The construction sector, a major consumer of DAA, was notably subdued due to unfavorable weather conditions, including typhoons that disrupted building activities and hampered demand. This further contributed to a buildup of inventories, adding to the existing oversupply in the market. As a result of these factors, the price of Diacetone Alcohol in China dropped throughout the quarter, ending at USD 1500/MT FOB-Shanghai. This decline reflects the overall weak market sentiment, characterized by a supply-demand imbalance and broader macroeconomic challenges affecting the APAC region during Q3 2024.
Europe
In Q3 2024, European Diacetone Alcohol (DAA) prices experienced a decline, primarily driven by subdued demand and ample inventories. Both domestically produced and imported DAA were readily available, creating an oversupply in the market, which exerted significant downward pressure on prices. Key downstream industries, such as paints, coatings, and construction, exhibited lower-than-expected consumption levels, further compounding the market imbalance. As the quarter drew to a close, broader economic indicators reflected a mixed picture. The European Commission’s Economic Sentiment Indicator (ESI) remained relatively stable at 96.7 points in the EU, while dipping slightly by 0.3 points in the eurozone, reaching 96.2 points. Despite the overall decline in DAA prices, the steadiness of the ESI suggests improved confidence within the construction sector and among consumers, hinting at a potential recovery in demand moving forward. However, this optimism was not yet strong enough to offset the impact of weak industrial demand on DAA prices during Q3. By the end of the quarter, the downward pricing trend remained a key feature of the European DAA market, with the supply-demand disparity continuing to define the market landscape.
For the Quarter Ending June 2024
North America
The second quarter of 2024 has been marked by a significant upward trend in DAA prices in the North American market. Key factors driving this price surge include heightened production costs stemming from increased feedstock prices, notably Acetone. The market also faced supply constraints, influenced by moderate to low manufacturing rates and intermittent labour shortages, which exacerbated the disparity between demand and supply. Additionally, robust performance in essential downstream sectors, particularly paints and coatings, has sustained the demand pressure on DAA prices.
In the construction sector, demand for DAA was buoyed by robust performance as the Spring buying season commenced. With the onset of spring, construction projects across the country experienced a significant increase in activity. These projects, including rural highway repaving, freeway-style interchange construction, and safety enhancements, aimed to address infrastructure needs and accommodate growing transportation demands. This construction surge reflected efforts to meet increasing demands, maintain existing infrastructure, and expand transportation networks to support various modes of transportation.
Additionally, there was a positive signal in the hospitality sector, with the volume of hotel rooms under construction growing year-over-year for the first time since June 2023, indicating a gradual recovery. These combined factors have driven up the demand for DAA, a crucial ingredient for construction paints and coatings. The quarter concluded with DAA prices pegged at USD 2206/MT for Diacetone Alcohol DEL Louisiana, USA.
APAC
The second quarter of 2024 for the Diacetone Alcohol (DAA) market in the APAC region has largely been characterized by price stability. This equilibrium was driven by a balance between supply and demand dynamics, with adequate inventories meeting moderate to low consumer interest. Contributing factors to this steadiness included unchanged feedstock Acetone prices, consistent production rates, and a muted performance from downstream sectors such as paints, coatings, and construction. Seasonality played a minimal role, as the expected uptick in construction activity during the peak summer months did not materialize substantially, primarily due to economic uncertainties and market speculations. In China, the market experienced the greatest price fluctuations within the region. The overall trend for DAA prices in China was one of stability, underpinned by a steady supply from resumed operations at key Acetone production facilities. The quarter-ending price for DAA in China stood at USD 1517/MT FOB-Shanghai. Despite the overall negative percentage changes, the pricing environment throughout the quarter remained predominantly stable, suggesting that market adjustments were both predictable and manageable.
Europe
In the second quarter of 2024, the Diacetone Alcohol (DAA) market in Europe faced a challenging environment, characterized by a consistent downward trend in prices. Several key factors contributed to this decline, notably the subdued demand from major end-user sectors such as construction and automotive. The construction industry experienced a downturn, largely due to a combination of economic and geopolitical uncertainties. High financing costs and unfavorable weather conditions further exacerbated the situation, leading to a reduction in demand for DAA, an essential component in construction-related paints and coatings. As a result, the decreased activity in the construction sector significantly impacted the consumption of DAA. Similarly, the automotive sector witnessed a decline, particularly in the sales of electric vehicles (EVs) and passenger cars. This slump was partly due to the withdrawal of government incentives for battery-powered electric vehicles, which resulted in a noticeable decrease in new registrations. The reduction in demand for DAA, crucial for the production of automotive coatings and other related products, added to the challenges faced by the DAA market. Overall, these factors collectively contributed to the persistent downward pressure on DAA prices in Europe during the second quarter of 2024. The market continues to navigate these challenges amid a complex and evolving economic landscape.
