For the Quarter Ending June 2021
Despite of rising feedstock LNG prices in the USA, prices of Hydrogen traced a downward trajectory during Q2 2021. The demand for Hydrogen has been consistently increasing in the global market due to its low carbon footprints. During this quarter, prices of Hydrogen declined due to abundant stock availability and market competitiveness with Saudi Arabia, who were exporting feedstock Hydrogen on a much cheaper rates than USA. Therefore, manufacturers were compelled to reduce the prices to maintain price parity. Therefore, a significant decline in prices was observed during this quarter in USA, which eventually settled at USD 1350/MT during end of June.
Asian market experienced firm sentiments for Hydrogen during this quarter, as like other countries Asia also has started regarding Hydrogen as clean fuel alternative. In India, prices of Hydrogen kept on rising till the end of April, but later declined in May. Subdued demand from industries under pandemic mayhem in India reduced the prices of Hydrogen effectively, which later rebounded in the month of April. Thus, prices eventually settled at USD 369.2/MT in India during end of June. Besides, China invested a huge amount on Hydrogen, while procuring significant number of cargoes from Saudi Arabia in the meantime.
This quarter, overall price of Hydrogen remained stable in Europe, backed by firm demand from downstream sectors. Meanwhile, Germany was heard inventing huge amount of money on more than 60 new Hydrogen projects alone, while procuring significant cargoes of feedstock LNG from regional and international market. In addition, regional car manufacturers began researching on Hydrogen fuel cell to keep themselves ahead with the trend.
For the Quarter Ending March 2021
The US freezing storm disrupted industrial activities of the US Texas region for almost two months. Most of the plants were down amidst this winter freeze, it is estimated that, more than 7.37% of LNG output was totally halted due this extreme cold. Hence the production of Hydrogen was also reduced with shortage of feedstock Methane, across the region. Although the domestic demand for Hydrogen remained high, tight supply further supported the prices of LNG.
The Asian market witnessed a continuous boom in the Hydrogen demand as a fuel, especially in China. China invested a lot in Hydrogen fuel in past couple of years to reduce CO2 emission of the country, and they continued this trend in last quarter as well. Meanwhile, surge in COVID 19 cases in China forced the government to implement partial lockdown across some region, which affected the transportation of Hydrogen and ultimately reduced the availability of Hydrogen in the country. On the other hand, Indian government also announced a big budget of green Hydrogen that enhanced the market sentiments across the country. Although, Panama Canal congestion and surge in import prices halted the availability of Hydrogen in the country which supported the prices. Prices of Hydrogen in Indian market rose from USD 258.83 to USD 310.02 per MT from early January to March ending.
The European LNG demand remained high amidst winter in addition supply tightness supported the prices cross the region, which directly impacted the prices of alternative Hydrogen in the market. Germany is just behind China in the race of Hydrogen as a fuel for transportation thus its demand in the European region is expected to remain high in forthcoming quarters also. In addition, the prices of feedstock Methane also witnessed prominent ruse due to higher LNG exports to Asia and lower supply from the US Gulf under extreme cold conditions.
For the Quarter Ending December 2020
Demand for hydrogen gas in the Asian market remained firm as various countries like China and India were heard shifting gears to establish a greener economy in which clean fuel can be used like Hydrogen. Stable price of natural gas accounted for stability in the price of hydrogen gas. The rise in prices of natural gas in Q4 of 2020 due to winter chills in some producing belts, accounted for the rise in price of Hydrogen gas in Q1 of 2021. Towards the end of the year, major economies in Asia were heard shifting towards electrification of vehicles in response to climatic shift. Sentiments were uplifted after in Nov. 2020, the Japanese government launched a 15-year plan to develop its fuel-cell supply chain and hydrogen-powered trucks and buses with the aim of rolling out at least 1 million Hydrogen-Fuelled vehicles by 2030.
Firm demand for Hydrogen gas from the transportation and refining industry has sustained its rich market sentiments in Europe. As European Union is eyeing for the green economy which accounts for the demand of hydrogen gas, it can be used as a clean fuel in the transportation sector. In early October, market fundamentals of hydrogen gas remained in a narrow range due to economic slowdown and lesser consumption by the end-use sectors. However, the rapid pace towards vehicle electrification in Europe and massive investments in the sector for prospered demand of the Hydrogen Gas.
With the consistent increment in prices of the natural gas, Hydrogen gas prices in the US took an uptrend later in the quarter. The supply of natural gas tightened towards the end of the quarter due to less demand and production cuts due to lower demand. The natural gas prices rose in the fourth quarter due to winter storms and shutting of several refineries which contributed to an overall increase in the price of Hydrogen Gas. Offtakes were less as demand remained affected which went against traditional expectations for the year end.