For the Quarter Ending June 2023
North America
The prices of DMA plummeted in the USA market during Q2 of 2023 at USD 3083/ton DOTP Del USGC IN June, as per market team data. The market price of PMI depletes in the USA market at 48.4, and the market witnessed a decrease in the market value of the USA, primarily driven by weak demand from the downstream rubber and textiles industry. This demand fall contributed to prices' stability and downward momentum, benefiting from favorable market conditions. As the downstream demand fell, the prices of DMA gained downward momentum and remained weak. The market fundamentals, including weak rubber and drug industry demand, supported this price weakness. The decreasing demand for DMA has prompted stockpiling activities as production rates fall to meet the market needs. However, supply constraints have affected the product's availability, leading to a decrease in inventory levels. This imbalance between demand and supply has impacted market sentiments in the North American market. Over the last seven days, the Pharma industry has dropped 2.3%, driven by a pullback from Eli Lilly of 5.6%. In contrast, Teva Pharmaceutical Industries has gained 8.5%. Over the last year, the industry has been flat overall. As for the next few years, earnings are expected to grow by 14% per annum. Over the last seven days, the Textile industry has dropped 1.0%, driven by pullbacks from every company within the industry. However, the industry is down 29% over the past year. Earnings are forecast to grow by 111% annually.
Asia
The prices of DMA plunged in the Asian market to USD 888/ton FOB Dalian during the second quarter of 2023 in May, as per market team data. Factors influencing this change can be attributed to reduced quantities of ammonia, leading to alterations in market sentiments amongst those involved in the industry. Consequently, manufacturers encountered difficulties achieving efficient production capacity usage coupled with stagnant interest expressed by the rubber and textile sectors in purchasing goods. Companies chose to adapt their strategies according to prevailing conditions, with several instances highlighting notable declines in more premium forms of DMA. The prices of DMA depleted in the Chinese market and the production cost depleted, and the CPI ranged at 0.2%, and the Chinese producer prices plunged the most in seven years as deflation hung over the economy. The prices of feedstock Methanol and Ammonia also fell, impacting the market sentiments of the product. The supply chain situation remained moderate in the Chinese market, and the inventory of the product was rising as per the regional situation within the market. In the last week, coordination has been flat, and as for the longer term, the industry has declined 15% in the last year.
Europe
The market price of DMA plunged in the European market, starting at USD 3744/ton FOB Hamburg in April, as recorded in the second quarter of 2023. The production costs of manufacturing DMA plunged in the German market, followed by lowering demand from downstream rubber, textiles, drugs, and other chemicals, impacting the market sentiments of DMA. The market value of DMA was depleted in the German market as per the fall in the production cost of feedstock Trimethyl N-oxide manufacturing. The operating rates of tracking global peers are higher amid bets that Germany's interest rates could be nearing their peak as the European economy loses momentum. The supply chain situation in the German market remained moderate, and the investors are pessimistic in the region, indicating that their anticipated long-term growth rates in the coordination industry are lower than historically. The inventory level of DMA elevated amongst the traders and the merchants as per market team data and the stock of feed Ammonia and other Alcohol used in the raw materials.
For the Quarter Ending March 2023
North America
In Q1 2023, the US market witnessed an increase in the price of Dimethyl Amine (DMA) owing to heightened demand from downstream industries such as automobiles and construction. The semiconductor industry also played a significant role in driving up the price of DMA, as the compound is utilized as a reducing agent in the production of semiconductors like gallium arsenide and indium phosphide. Between January and February, the value of DMA rose by approximately 3% and 1%, respectively, before declining by roughly 3% in March. The decline in prices during March was primarily due to a decrease in feedstock Ammonia prices, which fell by 9% during this period, thus further influencing price trends. Ultimately, the price of DMA in the US market at the end of the quarter hovered around USD 3554/MT.
APAC
During the first quarter of 2023, the Asian market witnessed a decline in the price of Dimethyl Amine (DMA) due to the plentiful availability of the product in the region, despite low demand. In India, the price of DMA declined by approximately 24%, 20%, and 8%, respectively, over the three months, as a result of the continuously falling price of feedstock Ammonia in the market. Furthermore, the low buying interest for the product in the global market affected pricing dynamics during this quarter. Similarly, in other Asian countries such as China, the price of DMA also experienced a decrease due to the ease of product availability and low demand from overseas, ultimately affecting the overall price of the product under the influence of global price trends. However, in China, the price of DMA increased by 1% in February under the influence of improving economic activities. In January and March, the prices declined by approximately 1% and 10%, respectively, due to the decreased prices of feedstock Ammonia and low buying interest from overseas countries.
Europe
In Q1 of 2023, the European market experienced a drop in the demand for Calcium Chloride from the construction sector, despite the high supply in the region. This scenario led to an increase in the price of Calcium Chloride in the European market during Q1 of 2023. In the Netherlands, the price of Calcium Chloride (74-77% Tech Grade) FD Rotterdam declined by approximately 4%, 3.6%, and 3.7% in the first quarter of 2023, respectively, due to the decreased price of feedstock Calcium Carbonate. The price of Calcium Carbonate declined by approximately 8% and 7% in February and March. Moreover, high living costs and an increased inflation rate across Europe served as a secondary reasons for this downfall. The high inflation rate and cost of living resulted in reduced demand for the product, as businesses were compelled to increase their prices in response to the high cost of production. This, in turn, further diminished demand for the product.
In Q4 2022, the price of Dimethyl Amine in the USA surged in Oct and Nov in the wake of insufficient product availability and higher netback among the major manufacturers. However, towards the end of the quarter, market fundamentals declined, and suppliers were trading as per the requirement from the downstream enterprises. Low inventories among the ports and rising product demand forced the producers to revise the price trend for the domestic market. The operating cost of Dimethyl Amine among enterprises increased, and increasing demand further strengthened the price trend. With higher netbacks and increasing profitable sales and revenue, there was no room for the price cut this quarter.
This quarter, the market fundamentals of Dimethyl Amine increased when compared with the previous quarter. An inadequate stock among ports and limited manufacturing facilities this quarter prompted a cost surge. As indicated by buyer needs, the limited stock was obtained from end-user enterprises with warily operating manufacturing units. The inventory of Dimethyl Amine stayed limited, and makers were pressurized to fulfill the market fundamentals. The Cosmetic and Dyes industry was largely elevated by bullish demand and high purchasing appetite. The end-user industry worked their plants cautiously in accordance with the buyer's requirements. In Dec, the price of Dimethyl Amine in China slipped to USD 1186/ton FOB Dalian.
In Q4 2022, the trading fundamentals among the enterprises declined due to weak trading fundamentals and limited purchasing activities. Major Dimethyl Amine producers in the region revised the prices for the overseas suppliers due to product oversupplies and declining netbacks among the enterprises. Due to low trading fundamentals and sufficient product stock, the downstream textile and cosmetic industries remain feeble. Lower future settlements and a decline in energy prices resulted in eased production costs among the downstream ventures. Apart from that, slumping freight rates, piling stocks among the ports, and lower netbacks in Europe remain major factors for weak market fundamentals.
