For the Quarter Ending June 2022
North America
In the second quarter of 2022, Ethylene Oxide witnessed mixed sentiments throughout the quarter. The uncertainty in the crude oil prices affects the region's Ethylene Oxide and other petrochemical commodities. Due to the conflicts between Russia and Ukraine, the US imposed sanctions on Russia have supported the inquiries for WTI Crude from several Northeast Asian regions. The higher freight charges and delayed deliveries had levied impact on the complete value chain. At the end of the quarter, the price of Ethylene Oxide decreased, and the cost pressure from Ethylene weakened and supported the downstream industries.
Asia Pacific
The Asia Pacific market showed a rise and fall in prices of Ethylene Oxide throughout the second quarter. The fluctuations in international crude oil prices, as a resulting increase in Ethylene Oxide at the beginning of the quarter. The upstream cost pressure from Ethylene drives the downstream derivatives in the region. China lifted the area's lockdown and slowly returned to the normal market at the end of the quarter. Overall sentiments in the Asian Ethylene markets remain bearish, with demand curbed by low operating rates and weak regional production margins. Despite the current market uncertainty, OPEC has been unable to close the growing supply-demand gap in crude oil.
Europe
Throughout the quarter, the European region's trend of Ethylene Oxide increased. The tight supply of upstream Ethylene and rising crude oil and natural gas prices impacted the entire European market. Russia's special military operations against Ukraine, as well as European countries' retaliation in the form of sanctions against Russian oil and gas imports, had an impact on the international market. Supply chain disruptions caused by raw material shortages have been exacerbated since the sanctions imposed by the western countries.
For the Quarter Ending March 2022
North America
Nonyl Phenol Ethoxylates prices in the United States have witnessed strong market sentiments throughout Q1 in response to the higher Ethylene Oxide feedstock prices and outstretching demand. The curtailed operations in ExxonMobil’s Baytown refinery following an explosion in late December have continued to create a supply deficiency of upstream olefins and consequently caused its prices to gain significant numbers. The high upstream pricing, which got transferred to its downstream Ethylene Oxide, weighed on the input cost of Nonylphenol Ethoxylates. Prompting the manufacturers for a price increase, thus, the Nonylphenol Ethoxylates US discussions reached USD 1923/MT FOB Gulf Coast in the quarter ending March 2022.
Asia Pacific
In Asia, the prices of Nonylphenol Ethoxylates have witnessed an increment of 9% in the first quarter of 2022. Increased stockpiling activities with suspended Chinese Nonylphenol imports on account of the Chinese New Year Holiday break in early February have made its price skyrocket in the Indian domestic market, followed by the global shortage. Increased input costs with strong feedstock Ethylene Oxide and Phenol market added to the upward price trajectory in the Asian market. Also, increased application of personal care products kept the demand high from the downstream surfactant sector, causing the Indian prices of Nonylphenol Ethoxylates to soar in March to USD 2330/MT Ex-Kashipur. On the other hand, with declining buying sentiments and high inventory levels, the Chinese NPE prices slipped from USD 3528/MT in January to USD 3347/MT FOB Qingdao in March.
Europe
The European Nonylphenol Ethoxylates market has experienced a bullish pricing trend during Q1 of 2022. This uphill curve owed to the worsening economic crisis against the backdrop of the Russia-Ukrainian conflict. PCC group (Poland), a key exporter, fell short of raw material procurement from Russia because of restricted freight movements associated with the war in the entire region. Hence, the tight product supplies from Poland impacted the Nonylphenol Ethoxylates regional market and the downstream cleaning industry. Additionally, dueling with the supply challenges and inflationary pressure of bullish raw material market has brought about the German prices of NPE as USD 1993/MT FOB Hamburg in March.
For the Quarter Ending March 2022
North America
In the first quarter of 2022, the Ethylene Oxide market in the North American region has vastly been impacted by the gyration in the international crude oil market. The geopolitical crises raised in the eastern European region had a significant impact on the market dynamics of Ethylene Oxide in the US domestic market. Whereas, before that, the OPEC+ alliance decided to maintain the production margin despite the resurgence of the omicron variant of COVID 19 uplifted the upstream and Naphtha prices in the North American region. Therefore, the FOB US Gulf discussions for Ethylene Oxide settled at USD 1913 per tonne, by the quarter ending in March 2022.
Asia Pacific
The overall trend for the Ethylene Oxide in the Asia Pacific market showcased the different trends depending on the subregions and countries, as the Ethylene Oxide is hardly traded over the sea routes amidst its hazardous nature. Therefore the domestic market factors were majorly impacted the market dynamics for Ethylene Oxide. In China, the quotations fluctuated within a rangebound, as the resurgence of COVID had dropped the demand outlook from the downstream buyers, and the producers constantly shifted the operating rates to safeguard their interests in the Asia Pacific region. Whereas, the swinging quotations for crude oil have strengthened the market dynamics for the upstream Naphtha and provided adequate cost support to the Ethylene Oxide offers across the Asia Pacific. Therefore, the FOB Shanghai discussions for EO averaged USD 1287 per tonne, during the quarter ending March 2022.
Europe
Since 2021, the market dynamics in the European region observed several hindrances in the economic recovery from the losses that occurred in the pandemic. The region is already facing an acute shortage of natural gas and energy resources. The conflict between Russia and Ukraine further worsened the situation, as the strong opposition to Russia resulted in reluctance from buyers to accept cargoes upstream from the Russian ports. As a repercussion, the joint impact worsened the market dynamics, besides strengthening the will of producers to raise the quotations in the domestic market. Therefore, the FD South Hampton discussions for EO at the start of the quarter were assessed at USD 1920 per tonne, in January 2022.
For the Quarter Ending December 2021
North America
In the fourth quarter of 2021, the North American Ethylene Oxide market started on a stable note after the operational rates in the US started to improve post-hurricane season. In addition, the congestion, limited availability of freight vessels, and high charges for the Asia Pacific deliveries supported the significant reduction in the arbitrage from the US. In addition, the cost support from the upstream Ethylene plunged drastically throughout the fourth quarter. As a ripple effect, the offered quotations for EO dropped proportionally and the FOB Gulf coast spot discussion was settled at USD 1510 per tonne, during the quarter ending.
Asia Pacific
The Ethylene Oxide market in the Asia Pacific market witnessed mixed sentiments throughout the fourth quarter of 2021. In China, due to the coal shortages, the region started to witness the impact of the energy crisis and the power rationing proportionally hindered the operational rates at numerous crackers across China. In addition, the resurgence of COVID and stricter norms of the Chinese authorities supports the freight crisis in the Asia Pacific region, due to which the freight cost crossed the USD 20000 per 40ft container mark and impacted the arbitrage from the overseas market. As a ripple effect, the Ethylene Oxide offers in the Chinese domestic market peaked to the historical highs with the Ex-Shanghai discussion for technical grade soared to USD 1530 per tonne, during the last week of October. However, as the persistent efforts of Chinese authorities to curb the power rationing eased the inflation in the Chinese domestic market and the producer’s quotations cooled drastically by 22.5% by the quarter ending.
Europe
During the fourth quarter of 2021, the European Ethylene Oxide market remained consolidated due to the ongoing energy crisis in the domestic market which proportionally weighed on the manufacturing capabilities due to the higher energy cost. Several market participants anticipated that the current trend is likely to prevail till the mid-of the next quarter due to the limited Natural gas stocks. In addition, the congestion, limited availability of freight vessels, and high charges for the Asia Pacific deliveries supported the significant reduction in the arbitrage from Europe. As a ripple effect, the offers for the Ethylene Oxide market remained buoyed in the European domestic market and the FD Hamburg (Germany) discussion for Ethylene Oxide was settled at USD 1795 per tonne, during the quarter ending.
In Q3 2021, Ethylene prices witnessed a proliferative trajectory in US during the third quarter backed by the volatility in the feedstock ethylene which directly influence the market dynamics of Ethylene Oxide in the region. The demand for Ethylene oxide and its downstream products remained robust that contributed to the hike in the pricing trend of Ethylene Oxide through out the quarter. Moreover, many manufacturers were compelled to shut down their production plants as a repercussion of Ida hurricane in August that further exerted pressure on the Ethylene Oxide market. FOB-US Ethylene Oxide prices were assessed at USD 1620/MT in September showing an increment of USD 180/MT since July backed by the low production rates and higher demand in the region.
The Asian market of Ethylene Oxide showcased mixed sentiments during the third quarter. Chinese market observed a hike in the prices of Ethylene Oxide backed by the supply chain disruption due to the congestion on several ports of China. Moreover, curtailment in the production rates followed by the energy crisis in China further sent ripples to the prices of EO in this timeframe. In India, a marginal surge in the values of Ethylene Oxide was seen from July to August supported by the firm feedstock costs and sturdy demand from downstream MEG products. However, in September prices of Ethylene Oxide dropped down. Hence, the overall EO market remained unchanged in this quarter as domestic players sold majority of the produce at a predefined rate to the domestic consumers. The prices of Ethylene Oxide in India raised to USD 1350/MT in August from USD 1302/MT July prices and further in September, the EO prices laid back to USD1297.04/MT.
In Europe, the prices of Ethylene Oxide witnessed a marginal uptrend backed by the sturdy demand from downstream glycols and ethoxylates along with the hike in the prices of feedstock Ethylene. during this quarter. In addition, the spike in the value of Ethylene Oxide and its derivatives in Europe was due to exorbitant freight charges and lower imports because of container shortage. Promising profit margins were gained by the manufacturers following by the strong demand from downstream sectors. FD Hamburg Ethylene Oxide prices settled at USD 1790/MT witnessed an increment of USD 160/MT.
