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Formic Acid Price Trend and Forecast

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Market Overview

For the Quarter Ending September 2022

North America

In Q3, the price of Formic Acid in the USA surged with the succeeding month. A supply/demand equilibrium disruption occurs when major enterprises cut production due to a lack of product availability. With gradual accelerating demand from the downstream preservative industry, new stock demand remains robust. Rising fuel and transportation costs affected the market for conveying cargo within the region. In September 2022, the price of Formic Acid in the USA surged to USD 1099/ton FOB Texas. Due to the limited supply and low inventories in the domestic market, market fundamentals were impacted. Domestic demand for Formic acid was reported bullish, prompted by healthy demand from the downstream preservative market.

Asia Pacific region

In Q3 of 2022, the price trend of Formic Acid showed a downward trajectory with every subsequent month, along with deterred trading dynamics and sufficient product availability. In the midst of the declining demand from the downstream additive industry, regional Formic Acid producers cut their production as accumulation pressurized them to clear their current stocks. Sentiments of Formic Acid in the region remain thin, with affected margins and sales from the end-user industries. In terms of the feedstock market, Methanol prices stabilized this week due to tepid trading dynamics and utilization of existing inventories. In India, the price of Formic Acid slipped to USD 765/ton Ex-Mumbai.

Europe

In Europe, the Formaldehyde market rose with rising feedstock Methanol prices and oscillation in the upstream Natural Gas market. In September 2022, the price of Formaldehyde in Germany surged to USD 943/tonne FOB Hamburg. With European spot power prices surging, the production cost among the significant manufacturing units increased, affecting the price trend. Limited supply with elevating upstream Methanol prices in the region helped the Formic Acid market to elevate. Tightening supply had also sent Methanol prices soaring, with high costs forcing production cuts, especially in the downstream preservative industry. Record high operating cost has been forcing industrial consumers to limit production due to the unavailability of Formic Acid and fluctuations in feedstock Methanol price.

For the Quarter Ending June 2022

North America

In this quarter, the prices of Formic Acid dropped in May due to the surging production rate with revision in price trend for oversupplies suppliers. Feedstock Methanol prices also fluctuated on the lower end, affecting the prices of Formic acid in the regional market. However, the prices of Formic acid remained on the higher end, which caused fluctuations in the price trend. The supply/demand equilibrium improved with upcoming new capacities operating along with other plants and significant maintenance. Formic Acid prices surged compared with the previous quarter with strong market sentiments in the USA. However, acceleration in downstream demand, mainly from the preservative sector, surged the product's prices in June.

Asia Pacific region

In Q2 2022, the prices of Formic Acid slipped in June due to oversupplies of products in manufacturing units and ports of the major trading countries. During H1, the prices surged due to the limited supply of feedstock Methanol in the region with low purchasing activities of Formic Acid. However, in the second half, product inventories increased due to deterred demand in other Asian countries. With weak demand from India, Japan, and the Southeast Asian region, export from China is also affected by weak market sentiments. Ample inflows of Methanol in the region further pressurized the producers with affected margins and narrowing profit.

Europe

In Q2 2022, the price of Formic Acid slipped in the first half and revived in the final half due to fluctuations in feedstock Methanol and the downstream preservative market. Prices dropped in May due to accelerating production rates in Germany, increasing the exports to other European regions resulting in oversupplies in the region. However, in H2, supply chain woes and product shortage caused the recession trading, which caused this price hike. Import of Formic Acid in Germany from the Middle eastern market surged due to strong purchasing activities and surging interest of traders in this product. Demand from downstream preservative industries remained on a higher note, and rising interest from the industries forced the producers to meet the demand from the end-user industries.

For the Quarter Ending March 2022

North America

In USA, the price of Formic acid surged in the first half of the quarter as feedstock methanol have been on the uptrend which has increased the cost pressure over downstream Formic acid and pressured market participants to keep prices on the stronger side. Overall cost of production has increased further as Caustic soda and Sulphuric acid prices have further strengthened in the regional market as demand pull continued to play key role in pricing dynamics. However, in second half of the quarter, the prices fell due to bearish downstream enterprises. Downstream preservative industries were heard to operate moderately throughout the quarter and were on the lower side towards the end of the quarter due to sufficient stock. In USA, the price of Formic Acid in March was observed to be USD 878/ton Del Texas.

Asia Pacific

In Q1 2022, the price of Formic Acid remained surged throughout the quarter in Asian market. Disturbance in Chinese market and restocking activities due to Spring festival and winter Olympic curbs led to a steep inclination in prices of several commodities including Formic Acid in the Indian market. Meanwhile, firm domestic demand has also remained a major concern for supplier, as their profit intakes have been volatile due to limited product availability. In March, the price of Formic acid in India were surged to record height with the price trend of USD 794/ton CFR JNPT. Prices in China increased throughout Q1 of 2022 as raw material costs are not expected to mellow down owing to production disruptions caused by the government’s winter air pollution control policy which mandates manufacturers to reduce outputs for the months of January and February and continued till mid-March.

Europe

Prices in Germany apparently increased in Q1 2022 all through the quarter because of solid market sentiments and insufficient product accessibility. The company's downstream preservative endeavours product stayed in high demand. Since domestic output was insufficient to meet need in Netherlands, imports were additionally hampered by critical expansions in freight costs. This trend was brought about by limited methanol production in the region joined with a solid downstream demand. European market has been seeing aggravation because of extravagant climb in energy cost which shook the market elements of the locale. Due to stringent shortage of raw material in the midst of reliable bounce back monetary exercises, costs of a few products soar in a small span of time. In Germany, the price of Formic Acid in March were observed to be USD 910/ton FD Hamburg.

For the Quarter Ending December 2021

North America

During the fourth quarter of 2021, the Formic Acid market in the North American region showcased an upward trajectory after the increased prices of feedstock Methanol. US feedstock methanol and downstream Formic acid production have seen extreme drought conditions in the weeks after Hurricane Ida. This made landfall at Louisiana forcing shut Methanex’s Geismar plant and YCI’s St. James Methanol plant for major part of September, resulting in tight supply from October and increasing the overall cost production for Formic Acid in the year-end. Demand from various industries outperformed production while the Liquefied Natural Gas prices remained high causing energy mix mismatches across plants in USA. Thus, the price discussions fluctuated from USD 701/MT in October to USD 757/MT Texas (USA) in December.

Asia Pacific

In Asia, the Formic Acid prices advanced throughout the fourth quarter backed by the upward momentum of feedstock Carbon Monoxide. India imports Formic Acid mainly from China, if any disturbance in Chinese market, it creates a supply disruption to India. The Q4 disturbance in Chinese market was due to energy related issues that has decreased the output of several raw materials including Formic Acid. This led to steep escalation of Formic Acid prices in the Asia Pacific region. Also, the demand for Formic Acid from pharmaceutical, textile, leather, agrochemical, and other sectors remained high across the region, which supported this overall spike in Formic Acid prices. Thus, the prices of Formic Acid rose effectively and settled at USD 684/MT CFR basis India in December.

Middle East

In Q4 of 2021, Formic Acid market experienced mixed sentiments in the Middle East. Initially, in October and November, Formic Acid prices appeared to be bearish in Saudi Arabia as the feedstock methanol prices declined. Later, the sky-high energy prices in China impacted the Formic Acid market in Saudi Arabia, as the imports come majorly from China. Then the prices gradually increased with increasing freight charges, owing to the reduced import volumes from China. Low inventory levels, insufficient product supplies and firm demand from the downstream textile industry was observed. Formic Acid prices in Saudi Arabia reached USD 667 per MT CFR basis in October.

For the Quarter Ending September 2021

North America

In North America, Formic Acid prices witnessed an upward trajectory during the third quarter of 2021 backed by the hike in the feedstock Methanol prices. A severe fall in the production levels of feedstock Methanol was observed due to disruptions caused by Ida hurricane that made landfall in the gulf coast of USA at the end of August. For instance, Methanex’s Geismar plants and James Methanol went offline for around 2 weeks and thus resulted in a snug Methanol supply during this timeframe that consequently impacted the production of Formic Acid. Sturdy demand and the limited raw material availability pushed the prices of Formic Acid in this quarter.

Asia

During Q3 2021, a steep climb in the prices of Formic Acid was noted in the Asia Pacific region followed by strong offtakes from the downstream industries amidst tight supplies. In China, Formic Acid prices soared throughout the quarter backed by the upward momentum of feedstock methanol. In China, Methanol is majorly produced by the coal route and extreme coal scarcity led to consistent hikes in Methanol prices since the beginning of Q3 that consequently fumed Formic Acid values in the regional market. In India, the Formic Acid market experienced the same trend as other Asian countries during this quarter. Prices rose drastically in effect of sturdy demand from textile industry and spike in the prices of imported coal as well as feedstock values. Additionally, exorbitant freight charges further sent ripples to the values of Formic Acid in the domestic market. Hence, Formic Acid (85%) Ex- Mumbai (India) prices witnessed a substantial increase from USD 876.99/MT to USD 1656.53/MT during the third quarter.

Europe

In Europe, the Formic Acid market sentiments remained high throughout the third quarter backed by the strong demand from the downstream manufacturers. Surging feedstock prices due to expensive and lower imports from the USA as an impact of Ida hurricane also led to the increment in the values of Formic Acid in this quarter. In addition, many manufacturers were compelled to curtail their production rates in Europe due to the energy crisis that also affected the prices of Formic Acid. However, the demand from domestic and overseas market remained stable during this timeframe that also aided the pricing trend of Formic Acid in Europe.

Formic Acid Market Analysis: Plant Capacity, Production, Operating Efficiency, Demand & Supply, End-User Industries, Sales Channel, Company Share, Regional Demand, Foreign Trade, 2015-2035

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Market Analysis

Company-wise installed capacity, production volume and plant operating efficiency is captured directly from manufacturers. Import and Export volume is captured from government sources and demand for Formic Acid is calculated considering the production, import, export and inventory-levels on the country and regional level markets.

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Pricing Analysis

The product price is correlated with the price trend of crude oil, demand-supply gap, fluctuations in the feedstock and with the market movement of the downstream sectors.

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Company Profile

Basic details and information on financial performance of leading global players in the Formic Acid market is presented in a visually captivating manner. Expansion plans and the company’s strategy is also captured to understand the vision and mission of the company to help understand the areas where companies need to focus more.

News & Deals

Daily updates on industry-specific and product-specific news, exclusive primary-based news capturing plant shutdowns/outages/closures, capacity expansions, operating rates, insights on demand-supply situation, awarding of technology licenses, new product launch and deals specifying mergers and acquisitions, strategic investments and disinvestments, to help players capitalize on market opportunity.

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Methodology

ChemAnalyst gathers information through primary research surveys conducted with various Formic Acid manufacturers, spread across the domestic and international market, suppliers and dealers/distributors to gain insights into value-chains and demand-supply scenario to assess the market situation. Thorough study of company’s annual reports and secondary sources such as exhaustive search on credible paid databases, including our internal database is done to verify the information. All the collected information is analyzed, evaluated and presented in chronological order to depict a meaningful and clear picture of the concerned market.

Our dedicated team of industry experts comprehensively monitors and analyzes various aspects of the Global Formic Acid market. The team analyzes various industrial segments, strategic viewpoints and provides an analysis of the industry’s performance in the long run. This would enable our clients in efficiently plan their future investments, mitigate risk, understand the cost dynamics and strike out a balance amidst market volatility.

Critical examination of the impact of COVID-19 pandemic on the global supply chains and shift in demand patterns with change in buying behavior of consumers across the globe.

Several ongoing development projects across industries are tracked, followed by the details of major projects in the development stage, which can positively or negatively influence Global Formic Acid market.

Pricing is captured through exhaustive primary interviews with domestic and international manufacturers, traders and importers and customers on monthly and yearly basis.

Finally, region-specific markets for Formic Acid are analyzed and region-wise demand pattern is tracked.

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Formic Acid Price Trend and Forecast

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