For the Quarter Ending March 2024
North America
During Q1 2024, the pricing dynamics of Fumed Silica in the North American region, particularly in the USA, displayed a nuanced pattern influenced by multiple factors. The overall trend for the quarter was mixed with some supply disruption and fluctuating demand from the downstream construction industry.
The disruption in the weather conditions and the shipping issues created a disturbance in the transaction of commodities including Fumed Silica in the international market. The Arctic Blast that hit the US in January disrupted several businesses and delivered bitterly cold temperatures, which added to the problems with the orders.
During February 2024, the market situation in the USA played a significant role, with low demand from the downstream construction sector during the winter and holiday seasons. This resulted in a lack of buying activity and contributed to the overall bearish sentiment.
However, the demand for Fumed Silica in the USA rebounded during March due to the spring driving season. The National Association of Home Builders reported that its monthly confidence index increased three points to 51 in March, the highest level since July 2023 and the fourth gain in a row.
APAC
In Q1 2024, the pricing dynamics of Fumed Silica in the APAC region were influenced by various factors. The overall trend in Japan, where price fluctuations were most pronounced, was characterized by a moderate level of supply and low to moderate demand. The market situation was balanced during January 2024, with a cautious wait-and-see approach adopted by market players. The weak downstream demand from the construction sector, a major user of Fumed Silica, remained sluggish throughout the quarter. This subdued activity led to price stagnation and a lack of purchasing enthusiasm. Additionally, the market was impacted by factors such as low overseas demand, reduced profit margins for local businesses, and an increase in input costs during February 2024. The influx of inexpensive production costs in the region further affected prices. However, during March 2024, the demand for Fumed Silica in Japan remained high due to a rebound in the downstream construction industry. Japan's service economy expanded rapidly in March. Gains in total activity and new business were the greatest since August, driven by increased consumer numbers and confidence.
Europe
In Q1 2024, the Fumed Silica market in Europe, particularly in Belgium, experienced a persistent slump in prices due to subdued demand from downstream industries like sealants, coatings, and adhesives during January and February 2024. This was a direct consequence of the struggling European construction sector, which showed no signs of immediate recovery. The weakness in construction had a cascading effect throughout the supply chain, impacting industries heavily reliant on Fumed Silica. Additionally, the lack of signs of revival in the downstream construction industry in Europe further contributed to the poor performance of Fumed Silica in the market. The European construction industry slightly adjusted upward, but the industry still faced headwinds from the destocking season, where companies reduced their inventory levels, further dampening demand. However, the prolonged price decline had put pressure on profitability, prompting suppliers to adjust prices to achieve some level of stabilization during March 2024. While the overall Fumed Silica market saw a price correction, the situation within the downstream construction industry remained subdued as the sentiment aligned with the previous months.
For the Quarter Ending December 2023
North America
In the fourth quarter of 2023, the North American Fumed Silica market experienced a mixed performance. The market witnessed a temporary pause in buying activities during October as buyers anticipated an imminent price increase due to newly imposed import tariffs. Furthermore, European buyers suspended imports from the USA during October. However, there was a surge in Fumed Silica imports into the country, driven by efforts to safeguard local producers in Brazil. Overall, the pricing trend in the USA was influenced by cautious buyer behavior, prevailing economic uncertainties, and rising input costs.
However, November witnessed a moderate supply of Fumed Silica in the region, ensuring a steady flow of the product. The demand for Fumed Silica remained low, particularly in the downstream construction industry, due to a labor shortage in the sector. This muted demand had a significant impact on the market dynamics to showcase a downtrend.
The price of Fumed Silica in the USA at the end of the fourth quarter was USD 5644/MT DEL Houston.
APAC
In the fourth quarter of 2023, the APAC region witnessed a mixed market for Fumed Silica. The Japanese market saw a significant surge in Fumed Silica prices in October, driven by increased demand from the downstream construction industry. The country also faced challenges in supply due to the global surge in prices.
However, One of the key factors affecting the market was the high supply of the product, resulting from proactive inventory building by market participants. This surplus supply exerted downward pressure on prices, causing a bearish market sentiment for November and December. Another significant factor was the low demand for Fumed Silica, primarily driven by subdued consumption in the downstream construction industry. The sluggish demand from the domestic market further contributed to the downward trajectory of prices.
Overall, in the APAC region, the Fumed Silica market in the fourth quarter of 2023 was characterized by low supply, low demand, and fluctuating prices. The quarter-ending price for Fumed Silica FOB Tokyo, Japan, was USD 5709/MT.
Europe
The fourth quarter of 2023 was challenging for the European Fumed Silica market, with prices experiencing a steady decline during November and December. However, Fumed Silica prices saw a slight increase during October breaking a year-long trend of decline as the overall manufacturing sector faced challenges, with new orders, purchasing activity, and backlogs experiencing significant and rapid contraction.
November saw the market with a sharp downturn in the construction industry and increasing interest rates, which discouraged potential construction projects. The abundant supply of Fumed Silica also contributed to the low demand, as it exceeded domestic requirements. This slowdown in the construction sector resulted in a significant decrease in new orders for Fumed Silica manufacturers.
Despite the overall economic uncertainty, the market in Belgium saw the most significant changes in prices. The prices in Belgium decreased by 3% compared to the previous quarter. Additionally, the price in Belgium during the fourth quarter of 2023 was 20% lower than the same period last year. The quarter-ending price for Fumed Silica in Belgium was USD 5163/MT FD Brussels.
For the Quarter Ending September 2023
North America
In the third quarter of 2023, the North American Fumed Silica market, especially in the United States, exhibited a complex performance. During the first two months of the quarter, the product's price in the US market increased by approximately 4%. This price hike was primarily attributed to rising labour costs and inflation in construction materials. Price increases occurred more frequently compared to the previous month. Domestic market merchants proactively restocked in anticipation of future demand conditions. Increased demand from potential customers and limited stock availability also contributed to the price surge. Manufacturing activities showed an increase from June to July, with continued growth in total new orders. However, the pace of expansion slowed for the second consecutive month, reaching its lowest rate since April. In the last month of the quarter, the price of Fumed Silica decreased by approximately 0.5% due to decreased demand from the downstream construction industry. Furthermore, the US Construction industry added 11,000 jobs in September 2023, maintaining historically low unemployment rates. Contractors increased pay rates faster in this sector due to labour shortages, and the number of people working on non-residential construction projects declined as firms struggled to find enough workers amid tight labour market conditions.
Asia
In the third quarter of 2023, the Fumed Silica market in Asia, with a focus on the Japanese market, witnessed a fluctuating performance. Initially, over the first two months of the quarter, the product's price experienced a 3.5% decrease, largely due to reduced demand from the construction sector. The month of August, known for high humidity and the typhoon season in Japan, resulted in diminished construction activities. These adverse weather conditions contributed significantly to the decreased demand for Fumed Silica, an essential component in construction materials. Economic indicators echoed this slowdown, as Japan's manufacturing activities saw a slight decline in August 2023, marking the third consecutive month of falling factory activity. However, there was a slight uptick in the price of Fumed Silica, rising by approximately 3% in the last month of the quarter. This increase was primarily driven by a surge in demand from the construction industry as construction activities picked up momentum. Additionally, input price inflation reached its highest level since May, driven by increased raw material costs, rising energy and freight prices, and the impact of a weaker yen. These factors, combined with heightened production costs, exerted pressure on manufacturers to raise their output charges.
Europe
During the third quarter of 2023, Fumed Silica prices in the Eurozone steadily declined due to multiple factors, with the construction industry experiencing a significant downturn. This decline was further worsened by increasing interest rates, discouraging potential construction projects. A key highlight was the reduction in housing activity, especially in the German construction sector, which had a direct impact on residential building projects, leading to decreased construction activities. Amidst this challenging environment, the broader economic landscape in the Eurozone presented mixed signals. The manufacturing sector showed signs of contraction, reflecting the difficult economic conditions at the end of the quarter. Despite falling input costs, businesses continued to implement cost-cutting measures, including reductions in employment, purchasing activity, and inventories. Consequently, many firms extended their production cutbacks, reflecting an overall sense of caution and uncertainty that pervaded the economic outlook. The Eurozone's economic performance in the third quarter of 2023 was marked by the construction industry's decline, subdued housing activity, and a cautious business environment, as it grappled with various challenges.
For the Quarter Ending June 2023
North America
A continuous decline has been observed within the second quarter for fumed silica in the USA, followed by the previous quarter. The feedstock silane has supported the price trend for fumed silica during the entire quarter. As per the data, Producer Price Index by Commodity for Industrial Chemicals fell from 328.7 (April) to 309.7 (June). Moreover, inflation in the US has been high for a very long time. Consecutively, consumer spending has declined, leading to a decline in PPI, which has affected demand fundamentals within the USA. The reduced demand for the product, coupled with an abundance of supply, supported the price trend. Additionally, US Federal Reserve continues to hike interest rates to tamp down inflation, muted trading activity. Smooth and cheaper import of Fumed Silica from overseas strengthened the supply chain in the country. However, the demand did not meet supply, further contributing to the bearish trend. Moreover, the US economic upturn was slow in June as dependence on services grew rapidly, which contributed to a further decrease.
Asia
During the second quarter, fumed silica prices in China experienced a continuous downturn, followed by the first quarter. The declining feedstock silane prices within the quarter supported the downturn of product prices. Low feedstock silane prices put downward pressure on the product’s manufacturing process. Moreover, the abundant availability of the material and insufficient demand dragged the market dynamics to showcase the downtrend. The price reductions of Fumed Silica in the Chinese market are primarily driven by producers engaging in competitive selling strategies to offload excess inventory. The construction PMI index in China dropped marginally, reaching approximately 58.200% in May 2023, compared to the previous month's 63.900%. This indicates a lack of robustness in the country's construction sector. On the other hand, the supply of products remained high in China. The demand fundamental was affected by the rainy season which hampered the construction project. Therefore, the demand in the construction materials market has not performed well, and the demand for Fumed Silica has decreased accordingly during June.
Europe
For another quarter, the fumed silica prices were declining in the European market amid low demand for products from the downstream construction industry. As per Eurostat, Producer prices in the Industry in Germany dropped marginally, reaching approximately 135.1 in May, compared to March’s 136.9. This indicates a lack of manufacturing and trading activities. Moreover, a substantial decline in the European Production construction industry was observed from 114.1 to 113.7 in May, which is expected to follow in June too. Supply chains of the construction sector across the European region saw a notable improvement at the end of June. The price of the product declined in the global market which further helped to strengthen the supply in Europe. During June, the construction industry was facing challenges, including rising costs across materials, labor, energy, lending, and insurance. Shortages and delays in materials, along with labor shortages and a skills gap, further compound the industry's struggles. Project volumes were slowing, and there was a growing responsibility to design and deliver projects sustainably. Moreover, the feedstock silane prices, supported the fumed silica market throughout the quarter to showcase a downtrend.
For the Quarter Ending March 2023
North America
The price of Fumed Silica decreased in the quarter ending March 2023 due to reduced demand from paint and cosmetics manufacturers in the US market. This has led to increased availability of the commodity in the market, resulting in suppliers reducing their quotes to boost sales. Additionally, the costs of freight and silane, the product's base material, have decreased, contributing to the price reduction this quarter. The market situation is bearish, with moderate supply and demand from paint, cosmetics, and electronics manufacturers. Fumed silica is being reliably delivered to customers in standard quantities, with no significant disruptions reported in the first quarter of 2023. Thus, the price of Fumed Silica was quoted at USD 6210/MT FOB New York (USA) in March 2023.
APAC
The cost of Fumed Silica has increased, despite a reduction in silane prices and a decline in freight charges in the APAC region. The price inclination resulted from the surge in demand from downstream companies, particularly those in the cosmetics, electronics, and paint manufacturing sectors, who are eager to increase their production rates. The current market situation can be classified as bullish, with moderate supply and consistent delivery of Fumed Silica to customers in prevailing volumes, without any significant disruptions. The product demand remained strong among the paints and coatings, electronics, and cosmetics industries for production purposes, coupled with gradual growth in international inquiries. As per the latest pricing update, the price of Fumed Silica was quoted at USD 6470/MT FOB Shanghai (China) in March 2023.
Europe
In the European market, the cost of Fumed Silica has decreased due to reduced demand from downstream businesses. The sellers attributed the price drop to the weakened downstream demand in the German market. The market situation is considered bearish, with a moderate supply of fumed silica being delivered to consumers without any disruptions. The demand for this product remained modest, and it is pursued on the need basis by the cosmetics, electronics, and paints and coatings industries for production purposes. Additionally, the reduction in the cost of silane, the base material used in fumed silica production, has led to a decline in fumed silica prices. Therefore, the price of Fumed Silica was quoted at USD 6240/MT FOB Hamburg (Germany) in March 2023.
For the Quarter Ending December 2022
North America
The US Fumed Silica market remained underwhelmed throughout the quarter owing to low demand from the domestic downstream sectors amidst the abundance of the product in the country. Downstream industries' performance outlook stood upon expectations and remained dull throughout this timeframe. Supplies remained firm throughout the quarter, while inventories level heard remained abundant to satisfy all the needs of the country. However, producers were cutting production under expectations of low demand in the coming months. Demand for the product remained dull during this month, as the overall factory output of the country declined during the month of November 2022. However, as per the market experts, the recession might not appear this year and will in the short term in 2023.
Asia
Prolonged dullness in demand from the domestic as well as international market led to a significant fall in the price of Fumed Silica during this month again in the Asian market. Rising pandemic-related uncertainties injected uncertainties among the domestic key players of China. Supplies remained ample enough to satisfy all the needs of the country as well as the overseas market. Regardless of ongoing uncertainties in the market, supplies remained unaffected throughout this timeframe. Demand dynamics remained affected due to prolonged pandemic-related uncertainties that kept on affecting the economic output of the country. Furthermore, demand for the product from the downstream construction sector remained low, as the segment was still struggling to gain momentum.
Europe
The European market has been facing an issue of a consistent fall in demand for a long time. As per the December market scenarios, Fumed Silica prices fell in the regional market owing to prolonged demand dullness and the Christmas holidays during the second half of the month. Supplies remained ample enough to satisfy all the needs of the region, while Natural gas prices have also eased in the regional market. The data shows a decline of around 45% in the Dutch TTF Natural gas future during the month of December, posing optimism and easing the price trend of different commodities. As per the data, inflationary pressure has eased in the market, which has now threatened the region with the approaching recession. Therefore, traders have cut their imports and opted for wait and see approach. Furthermore, pessimistic market scenarios are also making consumers reluctant to buy cargo for future months.
For the Quarter Ending September 2022
North America
A Houston-based market source revealed to ChemAnalyst that the market movement shifted in a different direction when the central government announced a revision in interest rates in the country. The decision led the economic activities to slow down, which was essential to calm the inflationary pressure in the USA. However, market activities were already slow due to high raw material costs, and traders were opting for the wait-and-see approach. Nevertheless, Fumed Silica prices have traced an overall uptrend during July and started plummeting afterward in the USA, primarily driven by prolonged inflationary pressure in the country. Thus, Fumed Silica's price in the USA hovered around USD 7240/MT during September 2022.
Asia
Marginal positive price revision was observed for Fumed Silica in Japan during July 2022, owing to stable demand from the domestic as well as international market, which later kept on falling in the domestic market. As per the data, Fumed Silica prices showcased a decline during August and September post witnessing consistent price revisions for several months. However, market players revealed that the demand was revised to slow down again in the market, owing to the slowing economic activities of the overseas market. Thus, post witnessing a hike, Fumed Silica Price in Japan Hovered around USD 7540/MT during July 2022.
Europe
As per the data, the European Fumed Silica market witnessed an uptrend during the first month of the quarter owing to rising inflationary pressure and supply disruption caused by the Russo-Ukrainian war. During Q3, Russia announced to curb supplies of Natural gas to Germany, which made converters more cautious about the procurements. The Manufacturing Purchasing Managers' Index, the PMI index of Europe, hit 49.8 points in July 2022, 2.3 lower than the previous month. Thus, the recession also affected the overall demand fundamentals for the coming months; thus, domestic players started looking forward to delaying imports. Conclusively, post witnessing a rise of around 1.5%, Fumed Silica prices assessed around USD 7640/MT during July 2022.
For the Quarter Ending Q2 2022
North America
Prices for North American Fumed Silica remained high throughout the second quarter of 2022 due to growing raw material costs and steady global demand. According to a Houston-based market source, several construction-related raw materials' prices continued to rise during the quarter, with a heavy burden of inflationary pressure remaining the main driving cause. Additionally, the ongoing Russo-Ukrainian War's impact on natural gas prices during the second quarter impacted the product's pricing dynamics across the US market. The product's demand dynamics from the construction and adhesive industries further supported the regular shipments to domestic and overseas markets.
Asia
Long-standing global uncertainty had been hurting the Asian market for Fumed Silica, although in the second part of the quarter, demand for the product showed a sharp recovery. The primary causes of these increases were supply disruption on the international market caused by COVID regulations in China, the escalating crisis between Russia and Ukraine, the rising price of crude oil, and so on. In addition, China's pandemic-related uncertainty has put pressure on regional supply dynamics, which led to a supply gap that was subsequently filled by Japanese cargoes. The primary causes of these increases in demand for Fumed Silica in APAC nations were rising freight costs due to rising crude oil prices and a sudden rise of COVID cases in China, the key exporting nation.
Europe
According to ChemAnalyst's evaluation, it was seen that the price of Fumed Silica increased significantly in the second half of the quarter after rising steadily in the first half. A major producer of Fumed Silica, Cabot, announced a 15% price increase for the global market beginning in July. As a result, the market for Fumed Silica in Europe continued to trend upward. Furthermore, given that the country's producer price index has already risen enough to support this upward trend, this price increase was primarily driven by high input costs and intense inflationary pressure on producers.
