Quarterly Update on Global Glycerine Market
For the Quarter Ending June 2021
During the second quarter of 2021, Glycerine supplies in the North American region were improved comparatively from the previous quarter, as the industrial manufacturing ramped up in the US gulf region after facing the brunt of the winter storm-led disruptions. Increased volume of imports from the Latin America and Asia further supported the market supplies. Domestic suppliers confirmed spot availability for refined Glycerine and the buyers were willing to pay huge premiums to leverage pickup in demand trends. Demand was persistent from the downstream food and cosmetics industries, whereas the sentiments to replenish the inventories levels were strengthened ahead of upcoming hurricane season in the US Gulf region. As a ripple effect, the pricing trend observed a continuous up stride with FOB Ohio prices in June reaching USD 1325 per tonne for Glycerine 99.7% (Koshner Grade).
Glycerine prices in the Asia pacific region observed a multi fold hike in the offers owing to sturdy demand from the downstream industries and constrained production amidst shortages in the key feedstock chemicals. Due to limited availability of the feedstock, Glycerine production volumes reduced by certain margins in Indonesia. Whereas the demand was exceptional from the downstream pharmaceuticals and personal care sector to cope up with the surged offtakes from the hand sanitizers industries, as the second COVID wave severely impacted the Southeast Asian region in the first half of the quarter. Indian manufacturers held up the market fundamentals by increasing the offers by around 19.01% within Q2 with Ex-Works prices in June hovering around USD 1256 per tonne.
In the European region, Glycerine supplies showed improvement over the previous quarter, owing to better feedstock availability and production of biodiesel as the operational rates at manufacturing plants of the northwest European region restored with the better climatic conditions. Furthermore, supply side support was sought after the prolonged turnaround at one of the production facilities of OXEA Chemicals ended in the second half of the quarter, which improved the overall regional market outlook in Q2. Demand was resolute from the downstream pharmaceutical and personal care sector. Led by strong demand patterns, the CIF NWE Glycerine prices were assessed around USD 1134 per tonne in June.
For the Quarter Ending March 2021
Supplies in the North American region were constrained during the first quarter of 2021. The tightness was owned to the production disruptions caused amidst severe freeze weather conditions in the USA gulf coast region. The rigorous weather forced shutdown of a major plant in the Bay City site with production capacity of 120,000 MT/year. The demand surged due to shortage in supplies and continuous offtakes from the downstream sectors. OQ chemicals surged the feedstock prices which proportionally surged the prices of Glycerin with a quarterly FOB average of USD 1150/ton in Texas.
Glycerin supplies in the APAC region were balanced-to-tight during the first quarter, amidst upstream shortage due to plant turnarounds during the Chinese Lunar New Year holidays. Furthermore, the imports of Glycerin were disrupted amid the Suez Canal blockage in the end of March. However, the situation seemed to balance out by the commissioning of new crackers in China. The demand surged as offtakes from the downstream pharma sector improved. Glycerin FOB Shanghai prices were hiked to USD 1180/ton due to high demand and global supply shortage in March.
During the first quarter of 2021, the supplies of Glycerin were tight in the European region, due to low Biodiesel production in the northwest European region as several refineries were operating at low rates. Glycerin shipment to the APAC region remained halted amid the Suez Canal blockage in late March. In Austria, a new 200,000 bpd Glycerin & Biodiesel plant has been proposed to be established in Schwechat refinery with an investment of USD 36.1 Million by 2022. The demand was balanced from the downstream sector, the average CFR prices in Hamburg of Glycerin were USD 630/ton.
For the Quarter Ending December 2020
Demand for Glycerine in the Asian market remained firm during Q4 2020. Pickup in demand in India during the festive season in November also contributed to a prominent surge in its values. The price for refined Glycerine in India for the quarter ending December 2020 was averaged around USD 880 per MT during the quarter. Global Green Chemicals (GGC), one of the major refined Glycerine manufacturer in Thailand revealed refined establishment of Glycerine manufacturing unit in December 2020. This new plant has a capacity of 20 KTPA will improve the supply of refined Glycerine in the APAC region. As the biodiesel and oleochemical sector is a major contributor in Glycerine production, significant downfall in these sectors resulted to tight supply of Glycerine in Asia.
Firm demand for Glycerine from the biodiesel and oleochemicals industry has sustained its rich market sentiments in Europe. As European Union is eyeing to reduce the imports of palm oil as it leads to increased deforestation activities, concerns of stressed availability of the feedstock has provided a forward push to the prices of Glycerine in the regional market. Due to second wave of COVID 19 and restricted movement across European region, supply of Glycerine got hampered. However, the plant utilization rates gradually improved under the optimism that prevailed from the consistent upward push in the crude values.
With the consistent increment in the prices of raw material, Glycerine prices in the US took an uptrend later in the quarter. Increment in the demand from the end user industries like personal care and health care boosted the market sentiments. Prices of the glycerine took an uptrend in the relevant quarter and also after the announcement of the formulation from World Health Organization (WHO) for making Glycerine based hand rub and sanitizers for the moisturization of the skin increased the demand for the Glycerine in the North American market. Rising Brent crude is further anticipated to support the price trend in the region at least till Q1 2021. In addition, a major biodiesel producer of US kept its plant shut throughout the quarter which also reduced the availability of Glycerine in the market.