For the Quarter Ending June 2021
In the second quarter of 2021, supplies of Diisopropyl Ether (DIPE) improved along with better feedstock availability due to improved operational rates at all Propane Dehydrogenation plants in the Gulf coast region which supported the production of DIPE. The availability of key upstream Propylene surged with the supply chains recovering from the impact of polar winter storm Uri. Market outlook also improved compared to the previous quarter and stabilized by May. Demand outlook in the North American region was buoyed by piled-up demand as a solvent from the paints, waxes, dyes, and resins industries to cope up with the rising enquiries from the building and construction sector.
Supplies of DIPE were tight in the second quarter of 2021 due to limited availability of key upstream Propylene, as several refineries and PDH units in China were on a turnaround in the first half of the quarter. Amidst rising inflation rate in China, the prices of raw material continued to maintain pressure over the producer’s margins till May which imparted wait and see sentiments among the DIPE buyers in China. Tight supplies and logistic constraints continued to maintain upwards pressure over Diisopropyl Ether prices in India. Prices of DIPE rose in the first half of the quarter and then attained a stagnancy with Ex-Depot Mumbai discussions settling at USD 2471 per tonne in June.
DIPE supplies in the European region showcased mixed sentiments as several PDH units, crackers and refineries were on a maintenance turnaround during the first half of the second quarter which limited the availability of key upstream chemicals and operational delays of DIPE. However, imported shipments from the US increased after the industrial infrastructure recovered from the impacts of the winter storm Uri. Demand outlook remained firm from the solvents sector strong with rising enquiries from the downstream producers as the contractual volumes recovered until May ending. Due to better demand and restricted supplies, DIPE pricing trend continued to stay firm in the European market.
For the Quarter Ending March 2021
During Q1 2021, the supplies of Diisopropyl Ether (DIPE) were tight in the region, as the stocks were bounded by the margins from the upstream markets. Supply tightened as shutdown of several petrochemicals production units due to deep freeze weather in the US gulf region disrupted production levels. Major upstream plants such as LyondellBasell, ExxonMobil and INEOS olefins declared shutdown in mid-February amid the extreme weather conditions further resulting in multi-fold surge in the prices of DIPE in the North American markets. After mid-March, traders saw increment in demand from the pharmaceutical, textile and several other downstream sectors.
The supply of DIPE remained balanced in the Asian region during the first quarter, owing to the addition of new propylene facilities in China, followed by the resumption of LG Chemicals facilities in the South Korea including the upstream producer Yeochun NCC (YNCC) which restarted its Propylene unit during the second half of Q1 2021. However, some Asian shipments were diverted to fulfill the western demand for better netbacks curtailed the supplies to other region. Ex-Works prices of DIPE in China were assessed at USD 1505 per tonne in March.
The supply of DIPE in the European region remained tight throughout the first quarter, as a repercussion of reduced production from northwest regional plants amid the shortage of key feedstock due to transportation lag. The situation got aggravated, as BASF declared planned turnaround in its ether facility. However, the demand persisted a healthy trend throughout the quarter from the pharmaceutical sector. The export trend shifted from the US to Asian suppliers, due to the extreme weather conditions in the US declined the transport of cargoes. In terms of prices, Europe remained to be the most feasible region.
For the Quarter Ending December 2020
Demand for Diisopropyl Ether in the Asian market regained stability due to ease in lockdown in most of the countries in Asia like China, South Korea, and India. Following the ease in lockdown, the demand for automotive increased due to which the demand for Diisopropyl Ether as an anti-knocking agent revived in Q4 2020 in comparison to the rest of the year. The demand-supply gap of the product remained balanced throughout the year as the supply of Diisopropyl Ether was stable following the resumption in activities of various manufacturing facilities across the region. As 2021 is expected to be a positive year for the automobile industry, the demand for Diisopropyl Ether is expected to boom in Asia.
Both demand and supply for Diisopropyl remained stagnant in Q4 2020 following a partial lockdown in the region following the fears of new strain of Coronavirus. Although the demand for petrochemical and automotive industry remained low, its consumption from pharmaceutical Industry for research and development appreciably revived. Since various industries went off stream under concerns of losses, majority of the demand in the region was fulfilled by the imports from Asian countries like China. The prices of the product were surged due to minimal supply from domestic players.
With the consistent increment in the prices of feedstock Propene amidst its tight supply in Q4 2020, the prices of Diisopropyl Ether also surged in the concerned quarter. Its demand increased in comparison to the supply as most of the manufacturing companies restrained to operate their plant at full capacities under the fears of demand uncertainty. Amidst the regional supply crunch and rising demand, imports of the products for fulfilling the demand in the pharmaceuticals and fuel additive considerably increased.