For the Quarter Ending March 2025
North America
In Q1 2025, the North American Hexamethylene Diisocyanate (HDI) market experienced a generally bullish price trend, driven by supply-side constraints and steady demand from downstream industries. The quarter began with stable HDI production and a modest recovery in the U.S. manufacturing sector, which helped support market sentiment. Although crude oil prices initially fell, easing feedstock costs, production costs remained influenced by ongoing trade policy shifts and geopolitical factors.
During the Mid-quarter, the Arctic Blast caused disruptions in production, while port congestion, particularly in New York and New Jersey, hampered logistics and exacerbated supply chain challenges. Despite these hurdles, HDI prices remained steady, supported by consistent demand from the automotive and construction sectors. The automotive industry saw a slight rebound, especially in electric vehicle (EV) production, which increased demand for HDI in Polyurethane (PU) materials used in lightweight and interior applications. On the construction side, while demand remained mixed due to high material costs and labor shortages, some growth was anticipated, with overall spending projected to rise by 5.5% in 2025.
Towards the end of the quarter, the bullish momentum continued, driven by persistent supply challenges, and increasing chemical exports, despite rising tariffs and trade uncertainties. Strong automotive demand and moderate construction activity contributed to steady HDI consumption, reinforcing the overall upward price trend for the quarter.
APAC
During the first quarter of 2025, the Hexamethylene Diisocyanate (HDI) market in Asia experienced a mixed trend, with fluctuations in both prices and demand. At the start of the quarter, HDI prices increased due to stronger cost support from improved feedstock availability and stable production levels in key manufacturing regions. However, this positive price movement was tempered by weak domestic demand, particularly in the automotive and construction sectors. In February, the market shifted towards a bearish trend as stock availability improved after the Lunar New Year holidays, which put downward pressure on prices. Sluggish demand from key industries, including automotive and construction, further contributed to the decline. Towards the end of the quarter, market sentiment remained moderate, with steady demand in Southeast Asia, particularly for HDI in Polyurethane (PU) production. However, China's weak property market and declining automotive sales kept the overall market subdued. The combination of stable production, fluctuating feedstock costs, and varying demand across regions resulted in a cautious and mixed overall trend for HDI prices and market conditions during the quarter.
Europe
The price trend for Hexamethylene Diisocyanate (HDI) in the European region saw notable fluctuations during Q1 2025, driven by a mix of supply chain disruptions, geopolitical tensions, and sector-specific demand shifts. The quarter began with a sharp price increase, largely due to tight butadiene supplies, limited crude oil availability, and geopolitical tensions, particularly regarding Russia and Iran. Cold weather further strained heating oil demand, exacerbating supply shortages. Despite challenges in the construction sector, demand for HDI in the automotive industry, especially for Polyurethane (PU) materials, remained steady. However, by mid-quarter, prices dropped as demand weakened across the automotive and construction sectors, coupled with continued supply chain disruptions caused by severe weather and labor strikes at European ports. These factors led to a significant price decline. Toward the end of the quarter, the price trend recovered slightly, supported by stable production, moderate feedstock availability, and renewed demand from the automotive sector, particularly in the growing electric vehicle market, as well as a recovery in some construction markets, particularly in Italy. Overall, Q1 2025 for HDI in Europe was characterized by volatility, influenced by external and internal factors that impacted supply and demand dynamics.
For the Quarter Ending December 2024
North America
In the fourth quarter of 2024, the Hexamethylene Diisocyanate (HDI) market faced a decline, largely driven by weakened demand from the construction sector and slower activity in the furniture industry. Reduced consumption and high inventory levels in these sectors, coupled with slower purchasing by polyurethane manufacturers, resulted in a more subdued market. While demand from the automotive sector remained steady, the overall market showed less momentum, reflecting the broader economic slowdown.
HDI production stayed stable throughout the quarter, but a decrease in feedstock Butadiene prices and falling crude oil prices exerted downward pressure on production costs. Additionally, supply chain disruptions and reduced export orders, particularly from key markets like Europe and Australia, contributed to the overall dampened market sentiment.
Compared to the previous quarter, the market experienced a decline, largely attributed to weaker demand in critical sectors like construction and reduced export activity. Despite steady growth in the automotive sector and continued interest in specific applications like coatings, the overall market slowed, reflecting broader trends in industrial activity and global demand.
APAC
In the fourth quarter of 2024, the Hexamethylene Diisocyanate (HDI) experienced bearish market. HDI production remained stable, supported by moderate feedstock availability, although supply chain disruptions, such as delays at key European ports and rail congestion, affected the market. Demand from the automotive sector stayed firm, bolstered by a steady rise in new vehicle registrations, which continued to drive the need for polyurethane materials. However, the construction sector faced challenges, with weak demand due to economic uncertainties, inflation, and reduced housing activity, particularly in November and December. Compared to the previous quarter (Q3 2024), HDI demand saw a slight shift. While the automotive sector maintained its positive trend, the construction sector experienced a decline, reflecting broader economic pressures and stagnating investment in construction projects. Exports grew, but at a slower pace, especially to key regions like the U.S. and European Union, where tariffs and logistical delays remained a concern. Overall, while demand from the automotive sector and certain segments of the coatings industry remained stable, the market showed slower momentum in Q4. The weakened construction sector and slower export growth led to a more balanced market, in contrast to the stronger dynamics of the previous quarter.
Europe
In the fourth quarter of 2024, the Hexamethylene Diisocyanate (HDI) market saw an 18% decrease from the previous quarter, driven by weak demand and various supply challenges. Production rates remained stable, but export levels dropped while domestic inventories increased due to sluggish demand. The construction sector experienced low demand as economic uncertainties and reduced housing activity weighed on consumption. While the automotive sector initially showed some strength with a rise in car registrations, it could not offset the declines in other sectors. On the supply side, HDI production faced cost pressures from rising crude oil prices and disruptions at key European ports, though feedstock availability remained moderate. Butadiene supply issues early in the quarter further impacted production costs. Although crude oil supplies improved in the latter part of the quarter, delays in shipping and growing domestic inventories continued to affect the market. The European construction sector struggled with economic challenges, and housing activity contracted sharply. The automotive sector also saw a decline in new car registrations by December, further dampening HDI demand. Inflationary pressures persisted, contributing to the overall market downturn, and further reducing HDI demand in both sectors.
For the Quarter Ending September 2024
North America
In Q3 2024, the Hexamethylene Diisocyanate (HDI) price trend oscillated in the North American region, showcasing moderate sentiments in the market. Initially, at the beginning of the quarter, HDI prices decreased amid reduced demand for HDI from PU segment amid sluggish consumption of Polyurethane materials in the construction and manufacturing sectors.
In the middle of the third quarter, HDI production rates were hampered because of the stressed availability of feedstocks in the region. The offtakes were moderate, and market players raised their quotations. Consequently, the second half of the quarter witnessed a price increment, underlining a gradual price uptick.
Towards the end of Q3, improved availability of Crude Oil in the international market and increased refinery operations resulted in firm availability of feedstocks and negatively impacted the HDI production costs. At the same time, the impact of Hurricane Helene resulted in reduced consumption from downstream industries and an increase in domestic stockpiles due to affected supply chain activities. The market players negatively revised their quotations and overall, the HDI prices witnessed a decline in Q3 2024 from the previous quarter.
APAC
In Q3 2024, the Hexamethylene Diisocyanate (HDI) market in the APAC region has been characterized by a fluctuating pricing environment. The quarter has witnessed significant influences from several factors such as increased upstream Butadiene costs due to fluctuating crude oil prices, moderate demand from downstream industries, and improved manufacturing activities. The market's dynamics were further complicated by supply chain disruptions and geopolitical tensions affecting crude oil imports, leading to variable feedstock availability. During the mid-quarter, the looming concerns about a recession in the US affected the international crude oil market and refinery operation. It stressed the upstream Butadiene supplies and HDI production rates. HDI prices fluctuated and rose marginally, and the price comparison between the first and second half of the quarter revealed a modest increase, highlighting slight recovery efforts. Towards the end of the quarter, the increased availability of upstream Butadiene supplies, driven by improved refinery operations and Crude Oil availability amid a resumption of Crude Oil supply from Libya in September 2024, negatively impacted the production costs. Simultaneously, offtakes for moderately low from the PU segment during the period. Conclusively, from the previous quarter in 2024, overall prices fell from the previous quarter, indicating a downward trend in Q3, 2024.
Europe
During the third quarter of 2024, the European Hexamethylene Diisocyanate (HDI) market experienced a predominantly negative pricing environment, and the price trend shifted its movement due to imbalanced demand-supply dynamics. Throughout the quarter, the sluggish demand from the polyurethane sector, particularly within construction, exerted downward pressure on prices. The Eurozone's construction sector continued its downturn, significantly impacting HDI consumption. Additionally, the manufacturing sector faced challenges, with the Eurozone Manufacturing PMI indicating declining new orders and rising costs, further dampening demand. Supply-side dynamics also played a role, as supply availability improved post-summer holidays, yet demand failed to match this increase, exacerbating inventory levels. From the mid-quarter, the demand-supply imbalances and external economic pressures caused a marginal incline in HDI prices. Seasonality played a role as summer holidays resulted in labor shortages and reduced manufacturing rates, impacting supply chains. Despite no reported plant shutdowns, operational rates were closely monitored to manage the surplus supply. The quarter concluded after an overall 15% drop from the last quarter's prices, indicating a persisting downward trend.
For the Quarter Ending June 2024
North America
In Q2 2024, the Hexamethylene Diisocyanate (HDI) price trend oscillated in the North American region. Initially, the price trend was firm as prices rose due to increased production costs. As per EQT, the energy sector witnessed escalations in production costs due to geopolitical tensions and positive economic data. Meanwhile, the market showcased mixed demand for HDI from the Polyurethane segment.
During the mid-quarter, HDI prices declined, and several significant factors influenced this decline. Predominantly, the reduction in demand from the construction sector adversely impacted HDI prices. This sector faced reduced spending and higher borrowing costs, which led to lower offtakes of Polyurethane materials used in construction applications. Moreover, the automotive sector's sluggish consumption of Polyurethane products due to the increased supply of Chinese electric vehicles further exacerbated the declining demand for HDI. Additionally, the cost support from upstream Butadiene and Ammonia fluctuated, impacting the production costs and subsequently influencing HDI pricing.
Towards the end of the quarter, the HDI price trend improved due to a revamp in demand for PU materials in the construction sector. The construction sector performed well, and according to the US Census Bureau, construction spending in May 2024 was estimated at a seasonally adjusted annual rate of $2,139.8 billion, reflecting a slight 0.1% decrease from April's revised estimate of $2,142.1 billion.
APAC
In Q2 2024, the Hexamethylene Diisocyanate (HDI) market in the APAC region underwent notable changes due to several factors. Initially, HDI prices fell due to reduced purchasing activity, driven by subdued demand in the Polyurethane segment and lower trading volumes in the market. At the same time, cost support from upstream Butadiene decreased because of declining upstream Crude Oil prices and reduced consumption rates. Mid-quarter, prices increased as production rates were affected by limited availability of upstream Ammonia due to previous production cuts and heightened demand from the pharmaceutical sector strained supply chains. Concurrently, demand for HDI surged as buyers stockpiled in anticipation of the monsoon season and increased production of Thermoplastic Polyurethane for PU sole footwear. This seasonal boost, combined with steady offtake from the Polyurethane industry, provided strong support for market prices. However, the construction sector's increased demand for Polyurethane materials further propelled prices upward. Towards the end of Q2, the HDI demand fell from the PU manufacturers due to sluggish consumption of construction materials. South China's construction industry faced a slowdown due to heavy rains, which reduced the business activity index to 52.3%, down 2.1% from May. Simultaneously, China's new home prices fell by 0.7% in May, marking the fastest decline in over nine and a half years.
Europe
In Q2 2024, the Hexamethylene Diisocyanate (HDI) market experienced a downward price trend in Europe due to a combination of factors that dampened market sentiment. The quarter saw a sustained decline in demand from the Polyurethane segment, exacerbated by a continued slump in construction activities. This sector, particularly housing and commercial projects, faced a significant shortage of new orders, indicating a persistent deterioration in demand conditions. Additionally, the overall economic environment in Europe remained subdued, with the manufacturing sector struggling with a slower-than-expected recovery. In Germany, where the impact was most severe, HDI prices reflected this broader regional trend with a noticeable decline. Seasonal factors, such as the anticipated reduction in production costs from lower upstream Crude Oil prices, were countered by moderate to low supply availability. Logistics disruptions and labor shortages also heavily influenced market dynamics. The relationship between reduced offtakes and increased inventory levels further pressured prices, resulting in a negative pricing environment throughout the quarter. Compared to Q1 2024, prices remained stable but were significantly lower, with the second half of the quarter experiencing a sharper price drop of 15%.
