For the Quarter Ending June 2023
North America
In the second quarter of 2023, Hydroquinone prices in the US market fell significantly due to sporadic fluctuations between supply and demand during the month. The fundamentals of market trade had been impeded by sluggish demand and large inventory levels. Additionally, the trend of depreciated pricing was strengthened by falling raw material phenol prices across the world. Due to high inflation, retail sales decreased. Retailers are also dealing with bloated warehouse inventory that they ordered during the epidemic to meet the surge in demand, even if demand remains flat. The price was valued at USD 7240/ FOB Houston as of the end of Q2 2023, with an average quarterly declination of 2.23%. Reduced freight costs were another factor that helped the weak trajectory. As American businesses struggle to get rid of their large inventory, import volume has decreased. At the main US container ports, the volume of imported goods decreased as well. Moreover, despite stagnating demand, retailers are facing bloating inventory ordered to meet increased demand and potential future shortages during the pandemic.
Asia
The market price of Hydroquinone declined significantly in the second quarter of 2023, driven by weak domestic and international demand. The price was valued and acquired at USD 7415/MT FOB Shanghai as of the end of Q3 2023, with an average quarterly decline of 6.15%. During the quarter, the PMI fell below 50 points, suggesting that the manufacturing sector was contracting. China's import and export activities were mixed. Exports decreased by 3.9% from the previous year, while imports increased by 1.9%. As negotiations progress, the Chinese market for the Hydroquinone price chart for CFR Shanghai has shown a weakening price trend. Due to the large inventory of Hydroquinone in warehouses, suppliers had to lower their prices to clear existing stocks. In addition, this price trend was essentially supported by the decline in sales in the end-user sectors, and there were no new inquiries from domestic and international suppliers. The prices of raw materials used to make Hydroquinone, such as Phenol, also fell during June. This also contributed to the price drop. Meanwhile, the Chinese government has taken measures to cool the economy, such as raising interest rates and curbing the money supply. Furthermore, market sentiment remained subdued due to declining buyer hunger, slowing sales from downstream industries, and a lack of new inquiries from domestic and foreign suppliers. Some market participants have reduced inventories of Hydroquinone APIs to reduce inventories and improve cash flow.
Europe
The demand for Hydroquinone API declined in the second quarter of 2023, resulting in a decrease in market prices. Hydroquinone prices fell 5.76% on average over the quarter to USD 7845/MT FOB Le Havre. Hydroquinone prices in Germany were on a downward trend as demand from downstream sectors and imports from exporting countries such as China and India slowed. The supply of Hydroquinone has increased due to the expansion of production capacity in India, the world's largest producer of Hydroquinone. This has led to an increase in the supply of Hydroquinone on the global market. However, the demand for Hydroquinone has decreased due to the slowdown in the global economy. Additionally, speculators have been selling Hydroquinone futures contracts in anticipation of lower prices in the future, which has also put downward pressure on prices. Also, the government relaxed some of the regulations on the import of generic drugs, which led to an increase in the availability of generic versions of Hydroquinone. The price trend of Hydroquinone is significantly impacted by weak purchasing momentum and overflowing stocks. Tariffs between China and the West Coast of the United States recently reached pre-pandemic levels, greatly reducing congestion and lowering sea freight prices, impacting overall market conditions.
For the Quarter Ending March 2023
North America
In the first quarter of 2023, the Hydroquinone market witnessed a price-decremented trajectory in the North American region. Prices were witnessed to be on the positive side till the termination of the first month of Q1 2023 because of consistent domestic demand, according to market fundamentals. The prices were accessed at USD 7750/MT FOB Houston with an average quarterly declination of 8.01%. Later with the commencement of February, the prices started to roll down with the declining freight charges in the exporting countries. Also, Hydroquinone prices fell in the USA because of fewer end-user sector purchases. With enough inventories and ample stocks among the merchants supported the decreased price trajectory.
Asia
The market prices for Hydroquinone relinquish significantly in the first quarter of 2023 as a result of a decline in demand from the downstream food, pharmaceutical, and healthcare industries. The prices were accessed at USD 8985/MT CFR Shanghai with an average quarterly declination of 11.23%. The fact that domestic retailers had ample inventories among themselves also influenced the market scenario negatively. The price of Hydroquinone decreased following a continuous decline for several months because of a shift in consumer attitudes towards the drug. The adjustment was supported by end-user industries' weak purchasing power. Also, the fright charges declined sharply to many folds in supporting the rolling down trajectory.
Europe
In the first quarter of 2023, the prices for Hydroquinone in the European market showcased a decreasing trajectory. At the termination of the first quarter of 2023, Hydroquinone values were accessed at USD 9385/MT FOB Le Havre with an average quarterly declination of 1.61%. With the commencement of Q1 2023, the prices remained on the higher end on the back of recent occurrences like the conflict in Ukraine and the ripple effects it had on global supply chains supported the market trend of Pharmaceutical API. Also, new production activities and high manufacturing rates in order to serve then large orders from the domestic as well as the overseas market further supported the rising trajectory. Later with the onset of February, it was observed that the pharmaceutical industry had minimal demand for Hydroquinone. The market for Hydroquinone API was also restrained by a drop in domestic inquiries. Also, the market was kept calm by the resumption of higher trade flows in Europe. Decreased freight charges also influenced the market prices. Also, the decrease in feedstock phenol prices globally further supported the negative trajectory. Enough inventories among the market payers supported the negative market situation in France.
For the quarter Ending December 2022
North America
In the Fourth quarter of 2022, Hydroquinone witnessed fluctuating market trends in the North American region. At the commencement of Q4 2022, the prices were recorded to increase until the second month of Q4 due to a high production rate, several logistic issues, and rising inflation. The positive support from the upstream feedstock Phenol and Hydrogen Peroxide also influenced the Hydroquinone market. Also, the blooming transportation cost and port congestion in the major ports kept the market situation robust. Furthermore, disorganization and slowdown in the production of API, along with rising energy costs, influenced the market positively. Later in December 2022, the prices fell on the back of ease in the inflation and lowering demand from the end-user sector. At the termination of Q4, the prices accessed were USD 10850/MT CFR Houston with an average quarterly inclination of 0.53%.
Asia
In the Fourth quarter of 2022, the Hydroquinone market stabilized in the APAC region. At the commencement of Q4 2022, the prices were recorded to increase in the first month of Q4 due to several factors, including increased input cost, high production rate, and several logistic issues. Also, the Consumer price index rose at the end of the last quarter of 2022, impacting the market situation. In addition, the positive support from the upstream feed Phenol also influenced the market. With the commencement of the second month of Q4 2022, Hydroquinone witnessed stabilization in the market activities keeping the prices firm with slight fluctuating on the lower end on the back of consistent demand and ease in the feedstock Phenol prices globally. The prices of Hydroquinone were recorded to be USD 13250/MT CFR Shanghai with an average quarterly inclination of 0.52%.
Europe
The market situation for Hydroquinone showcased a deflation throughout the Fourth Quarter of 2022. The prices of Hydroquinone were accessed at USD 9980/MT CFR Le Havre with an average quarterly declination of 1.67%. With ease in the shipments and transportation activities, the market showcased feeble sentiments. Also, relief of the port congestion in the major ports of Europe continues to facilitate an unhindered supply chain keeping the market weak. Low input costs and a significant decrease in feedstock Phenol and Hydrogen Peroxide prices negatively impacted Hydroquinone prices. The annual inflation rate in France slowed to 5.9% in December of 2022 from 6.2%, keeping the market situation feeble.
The Hydroquinone market showcased a downward trajectory throughout Q3 2022. The Hydroquinone API followed the truncated market sentiments owing to low to no demand in the US market from the downstream industries. The domestic merchants stated to have enough existing inventories to cater to end-user consumer demand. Also, the currency fluctuation in the US market affected the Hydroquinone API values. Furthermore, the stabilizing feedstock benzene and phenol prices kept the market feeble. At the termination of Q2, the values accessed were USD 10690/MT with a quarterly declination of 1.54%
In the third quarter of 2022, Hydroquinone API prices significantly increased in the APAC region. At the commencement of the first half of Q3 2022, the ongoing production halt and extreme weather conditions inflated the Hydroquinone API market. The Hydroquinone API market also experienced price increments owing to a significant decrease in feedstock benzene and phenol following the tight supply of upstream Crude due to the sanctions on Russian imports influencing the Benzene market. Hence, following the skyrocketed upstream crude price, the Benzene price trend also increased across the region. At the termination of Q3, the prices of Hydroquinone were recorded to be USD 13050/ton CFR Shanghai with an average quarterly inclination of 5.79%.
Hydroquinone API values witnessed stable market dynamics in the European market. From the beginning of Q3, the costs of Hydroquinone API were recorded to rise with a gradual hike till the second month of Q3 due to increased feedstock product benzene values followed by sanctions imposed on Russian imports. Also, the persistent soaring of fuel prices and the disruption in shipments led to delays in trade, impacting the feedstock and hydroquinone values in the European market. Also, domestic merchants were restocking their inventories. Later with the start of the third month of Q3, the price fell drastically, owning to decreased downstream demand and stabilizing feedstock prices, keeping the market feeble. Towards the end of Q3, the values were recorded at USD 10500/ton FOB Le Havre (France), with an average quarterly declination of 0.36%.
