For the Quarter Ending June 2021
EVOH supplies continued to stay impacted in the North American region due to shortage of the key feedstock Vinyl Acetate monomer (VAM). Some market observers reported strong sentiments to replenish the inventories of the raw material which raised procurement costs. Several manufacturing facilities were observed operating at reduced efficiencies due to limited availability of the raw material which further supported the upward price trajectory. Soaring container freight added to the supply pressure. Kuraray, the leading Asian Ethylene Vinyl Alcohol polymer (EVOH) producer announced positive revision in the prices for the market. Demand remained firm from the downstream packaging industry.
EVOH supplies in the Asia pacific region were tight in the first half of the second quarter as several upstream Acetic Acid and VAM plants were on a planned turnaround in several parts of Asia which caused hinderance to the production of EVOH. In May, Labour day holidays in China curtailed the supplies to some extent adding further pressure to the EVOH market outlook. Demand witnessed improvement due to pick up in commercial activities in China which increased the offtakes from the packaging industry. Affected with the surging prices of the key feedstock chemicals, the prices of EVOH in India witnessed a slight improvement taking Ex-Works prices to settle around USD 7800 per tonne in June.
During Q2 2021, the supplies of EVOH in the European region were gradually improved owing to the increment in the feedstock VAM from USA as the petrochemical producers in the gulf region restarted after the disruptions caused by winter storm Uri. Whereas the Asian cargoes were delayed due to the Suez Canal blockage in quarter starting. The market sentiments were strengthened throughout the quarter as buyers stocked up material before the upcoming hurricane season in the US. Demand was consistent from the downstream plasticizers industry which showed mixed sentiments due to lockdown restrictions in some importing countries.
For the Quarter Ending March 2021
During the first quarter of 2021, the EVOH market fundamentals were weighed under strong values of feedstock VAM, followed by the series of plant outages in US Gulf coast and nearby area including Kuraray America Inc. due to winter polar storm. In the first half, kuraray hiked the prices of EVOH throughout the region. Demand surged as the enquiries and competition among the spot buyers surged to procure the EVOH consignments for the food packaging and medical sector. The supply demand gap widened amid high demand and shortage of material in the North American region which led to multifold surge in the prices of EVOH during the first quarter.
The supplies of EVOH in Asia Pacific remained tight owing to the shortage of feedstock VAM throughout the region. During the Chinese Lunar New Year holidays, the inventory levels of EVOH diminished, followed by turnarounds in several upstream plants in the Northeast Asian region. It was observed that China's export volume of key feedstock VAM declined by 95% y-o-y to 1302 MT. Shortage of feedstock prompted key Asian producers to raise their EVOH offers. Japan's Kuraray hiked the prices of EVOH by USD 180 per ton for the domestic market and USD 200 per tonne for the overseas supplies within the APAC region. Demand surge from the downstream food packaging and medical sector. It was noted that several Indian buyers started to replenish their inventories in the second half of the quarter.
As major economies in Europe revoked the COVID restrictions by imposing lockdown, it limited the region’s production levels due to sluggish commercial and industrial activities. Reduced operations further led to tight supplies of EVOH in the European market during the first quarter. The import shipments from the USA declined amid bad weather conditions. Prices took a leap as limited to null availability hiked the desperation among the buyers to procure large volume ahead of further hike on the prices. Demand fundamentals were strong as offtakes from the downstream food and packaging sector were high.
For the Quarter Ending December 2020
EVOH market price in Southeast Asia rallied upwards keeping strong accord with the global price trend which mounted on the back of firming crude oil during first half of 4th quarter. While on the feedstock front, stability in the Ethylene Vinyl Acetate (EVA) supply was witnessed which helped in uplifting the total availability of product in the region. However, the projections remained high amidst uncertainty associated to the demand from downstream industries such as automotive, food and others. On the demand front, sentiments have been lit by the news of vaccine rollout and a sharp pickup in the manufacturing sector towards the year end. Some Indian consumers stated that shortage of import containers which started after mid-November exacerbated the overall market tightness. The average price of EVOH in the region were assessed to be around USD 7900 per MT.
The North American EVOH supply was hampered during October by the seasonal storms and Hurricane Laura in the Gulf coast regions which affected the overall product availability across the region. Prices remained high supported by stable feedstock and uniform demand from the food packaging sector majorly in the US, one of the largest consumers of packaged food globally. Certain manufacturers remained under pressure due to limited stocks and healthy demand fundamentals across the region enabling them to focus on revamping the production levels.
The supply of EVOH remained affected due to plant turnarounds in some regions due to COVID-19 pandemic which capped the market supply across the region. Steady improvement in demand was seen during November as lockdowns were eased and operations resumed in several end-user industries. The demand curve took an uptrend towards the end of December after weeks of persistent dullness. Prices rose to fresh highs due to firming feedstock and supply tightness due to soaring container freight.