For the Quarter Ending June 2023
North America
After riding the price-rise stairs in the 1st quarter, the market of Hexene saw a downfall again in the month of April of the year 2023 in the US domestic region owing to depressed demand from the downstream polyethylene(PE) industries. The manufacturing PMI had dropped to a six-month low of 46.3 in June 2023, which pointed out the contraction in the manufacturing industry, and led to the second successive monthly decline in the slope of the 1-Hexene price curve. The drop in production rates due to muted activity of the upstream ethylene market and the reluctance of downstream enterprises to place new orders are the probable reason estimated by the analysis team of ChemAnalyst. In May, the Hexene price curve had seen a 'downward slopping' since exports as a percentage of total sales had faced a contraction. In the month of June, walking through a flat path, the price of Hexene settled at USD 1370/tonne. As China's economy is still in the recovery phase, backed by the European recession, the global olefin market saw a slowdown in the month of June this year. Due to rate hikes, market sentiments had deteriorated further, leading to sluggish downstream demand in the plastic and polymer sector both in domestic and international markets.
APAC
The market prices of Hexene had declined in the Chinese domestic market compared to the price closed in March this year, valued at USD 1215/tonne. This is due to the fact of suppressed demand from the downstream polymer and solvents industries. The manufacturing sector had seen a contraction indicated by the PMI number 49.5 in April due to a slowdown in factory activity since January amid an ongoing property decent and global recession. As per the market participants, in this time frame, no major supply chain constraints or port congestion had been registered in the region. In May, the market sentiment for 1-Hexene had improved because the downstream demand of polymer and solvents manufacturing industries was rising. However, there had been a slowdown in the imports of Hexene due to supply storage in the major exporting nation South Korea amid which the prices inclined upwards. In June, due to the weakening support from domestic demand of the downstream polyethylene (PE) market again, there was a drop in Hexene prices in China. Moreover, feedstock naphtha prices were plummeting in Asia, nearing a two-and-a-half-year low, which had weakened the support for the Hexene market.
Europe
The market price of Hexene had seen a surge in the German domestic market because the demand got strengthened for downstream polymer and solvent industries. Due to the European market's humming activity, the polyethylene market has also seen an upswing. The market prices of Hexene had soared to a value of USD 1300/tonne in April due to increased competition amongst the market players in the domestic market and overseas regions. In May, the market situation was quite bullish owing to looming inflationary pressure. In addition, the debt-selling talk in the USA had a negative impact on the German economy, which weakened the trade relationship between the two. In June, the market of Hexene was on a bumpy ride. The prices of Hexene remained unchanged at around USD 2940/tonne as the GDP had declined over the past two quarters, causing the European territory to enter the recession zone. Moreover, the support from the downstream polyethylene (PE) market weakened due to depressing demand. In June 2023, the estimated PMI number had not met its target and remained at 40.6, which indicated the fastest market collapse since the COVID-19 pandemic. In June 2023, the rise in inflation by 4.9%, the oversupply in Asia's polyolefins market, coupled with a significant weakening in demand, had given rise to bearish market sentiment for the product.
For the Quarter Ending March 2023
North America
The market prices of Hexene showcased a bearish trend throughout the first quarter of 2023 in the US domestic market. Amid hindrances and off-seasonal trends in the downstream polymer and solvents industries, the prices dropped in January 2023. The market competition was limited as weaker participation from overseas players, especially from the Asian region, was registered in this quarter. In the second month of Q1 2023, the prices of Hexene increased owing to higher demand from the downstream polymer and solvents industries. Also, the demand for the derivative segment polyethylene surged in the region. In the last month, the prices increased slightly amid an improvement in the demand outlook from the domestic and overseas markets. Thus, the market prices of Hexene FOB Louisiana settled at USD 2441 per tonne at the end of Q1 2023.
APAC
In the first quarter of 2023, the Hexene market in the Chinese domestic region experienced mixed sentiments. In the first month of Q1, the market prices of Hexene saw a surge in demand from the downstream industries and increased pressure on logistics, causing a shortage of the product in the market due to the rebound in market activities after the Lunar New Year. In the second month, the market dynamics stabilized, and the rebound of economic and commercial activities and an increase in demand from the downstream polymer and solvents industries led to balanced supply and demand dynamics. In March 2023, the market prices increased further, owing to a rise in market competitiveness amongst the market giants, and the overall fundamentals of Hexene improved further. Thus, the market prices of Hexene CFR Nanjing settled at USD 1900 per tonne at the end of Q1 2023.
Europe
The Hexene market in Europe showcased mixed sentiments throughout the first quarter of 2023. In January, the dropped due to a lack of market competitiveness coupled with the surge in inquiries for finished downstream product Polyethylene. Additionally, the cost support from the feedstock Ethylene dropped considerably in the regional market. In February, the prices declined in the first half of the month, and then in the second half, the market sentiments for Hexene improved. The demand for the commodity rose amid increased market activities and active procurement from end-use consumers. In March, the prices upsurged, backed by increased demand from the downstream polymer and solvents industries. The demand outlook improved substantially as the operations at the downstream facilities soared and increased downstream inquiries were reported. Thus, the prices of Hexene CFR Germany settled at USD 2199 per tonne at the end of Q1 2023.
Overall, the Hexene market in the North American region has observed a consistent bearish outlook throughout the fourth quarter of 2022. The Hexene market has been consistently influenced by the reduced cost support from the feedstock, and the weakening values of the Crude have a significant impact across the values chain. In addition, the demand from the downstream has remained inadequate to uplift manufacturers' sentiments to increase the offers for Hexene in the domestic market. However, the offers in the first half of the quarter have offered quoted for Hexene have remained fluctuating within a rangebound depending on the demand outlook from the overseas market. However, in the latter half, the discussion for inquiries from the PE industries has further plunged, weakening the enthusiasm amongst the market players despite the embargo of the EU over Russian energy supplies. As a ripple effect, the FOB Texas discussions for Hexene were assessed at USD 2478 per tonne in December 2022.
The Hexene outlook in the Asia Pacific region has remained on a bearish trajectory throughout the fourth quarter of 2022. This setback is majorly attributed to the increased market competition across the region. The consistent imports of Russian Crude Oil at cheaper rates have provided an advantage to the prominent exporting nations over the price competitiveness. At the same time, the far east Asian player has started the destocking drive to complete the sales target and improve the enterprise's financial outlook ahead of the year's end, leading to a wider window for negotiation from the downstream players. In contradiction, the downstream players in the far-east Asian markets have also restricted the cash outflow resulting in a curtailment of overall demand. As a ripple effect, the Asian Hexene players are keen to participate in other regions leading to intense price competitiveness amongst the market players. The FOB Busan discussion for Hexene was assessed at USD 1345 per tonne in December 2022.
In the fourth quarter of 2022, the Hexene market in the European region has observed a consistent bearish outlook and a considerable drop in offers throughout the period. As per the market experts, the European market currently lacks market competitiveness. The constantly soaring inflation and hiked interest rates have increased the cost of living amongst end-use consumers leading to a strict conservative buying streak. Even though the operating rates at the facilities remained dull and the embargo on the Russian energy supplies has been negated by the participation of the Asian players with high price competitiveness margins. As a ripple effect, the CFR Hamburg discussion for Hexene was assessed at USD 2248 per tonne in December 2022.
