For the Quarter Ending September 2024
North America
In Q3 2024, the Isothiazolinone prices fluctuated within a narrow range under the influence of multiple factors acting simultaneously. Meanwhile, the U.S. economy exhibited mixed signals, maintaining underlying strength despite persistent inflation concerns and geopolitical tensions.
Supply dynamics were shaped by the interplay of steady manufacturing activity and evolving trade conditions. The Producer Price Index (PPI) for manufacturing industries slightly declined from 249.624 in Q2 to 248.383 in Q3, reflecting minor cost reductions for producers. Inventory restocking after significant drawdowns in the first quarter contributed to a rebound in GDP growth, which reached 3.0% in Q2 and is projected to grow at 2.7% for the year.
Consumer spending and business investments, fueled by supportive policies like the CHIPS Act, continued to drive demand, while inflationary pressures eased, with CPI inflation falling below 3.0% by July. However, geopolitical uncertainties—such as the Ukraine and Middle East conflicts—along with potential tariffs on imports posed risks to supply chains, threatening to elevate costs and disrupt trade flows. Despite these challenges, the Fed’s expected rate cuts aim to bolster household spending and economic momentum, though labor market shifts and trade policy uncertainties may continue to impact the supply landscape into 2025.
Asia
In Q3 2024, the APAC region experienced a notable increase in Isothiazolinone pricing, driven by a combination of factors influencing market dynamics. The market saw a surge in prices due to heightened production costs amidst weakened industrial demand and output, impacting the overall pricing trend. The region faced challenges such as slowing industrial growth, sluggish retail sales, and adverse weather conditions, all contributing to the upward price movement. Despite these obstacles, the automotive sector demonstrated resilience, particularly in new energy vehicle production, which bolstered chemical consumption. Plant shutdowns, such as those caused by Typhoon Yagi, further disrupted supply chains, influencing pricing trends. China, with the most significant price changes in the region, experienced fluctuations in Isothiazolinone prices throughout the quarter. The market exhibited overall positive trends, with a notable 8% increase from the previous quarter. Price comparisons between the first and second half of the quarter revealed a 7% uptick, culminating in a quarter-ending price of USD 1724/MT for Isothiazolinone MIT 14% FOB Shanghai. This consistent upward trajectory in pricing signifies a predominantly bullish sentiment in the pricing environment for Isothiazolinone in China during Q3 2024.
Europe
Isothiazolinone prices in Europe during Q3 2024 fluctuated within a narrow range, reflecting uncertainties caused by the ongoing conflict in West Asia and sluggish growth in both Europe and the U.S. The freight sector experienced rising costs, as carriers like MSC and CMA CGM raised FAK rates to $6,500 per container, citing space shortages and operational surcharges. Red Sea disruptions and port congestion in Singapore further delayed shipments. Air freight rates from Northeast Asia to Europe also rose significantly, with a 40% increase in spot rates due to growing e-commerce demand and semiconductor activity. Despite expanded capacity, logistical imbalances persisted, complicating operations. As geopolitical tensions heighten and seasonal demand increases, freight market instability is expected to extend into Q4. Germany’s industrial downturn, marked by weak output, rising energy costs, and declining exports, weighed heavily on the eurozone's economic performance.
For the Quarter Ending June 2024
North America
The second quarter of 2024 has stabilized in the Isothiazolinone market in North America, marked by a mixed trend in prices during this quarter. The decline in Isothiazolinone prices in May 2024 has been influenced by several significant factors, primarily the reduction in crude oil costs and oversupply conditions. The depreciation in the prices of upstream has notably eased production costs, contributing to lower Isothiazolinone prices. Furthermore, an oversupplied market condition, driven by excess inventories and high stockpiles of Isothiazolinone, exacerbated the price decline.
Turning to June 2024, the end of the second quarter witnessed prices of Isothiazolinone increase due to heightened production costs and cautious operations across the US Gulf Coast and Louisiana despite demand conditions being largely unfavorable from the downstream market. The increment in the prices is further attributed to lengthened delivery times and higher transportation costs which further pushed the prices of Isothiazolinone on the higher end. Higher mortgage rates are expected to further cast a negative sentiment for the transactions in the downstream industry keeping overall demand conditions moderate. The procurement activities from the industrial application remained positive for the time being.
The correlation between reduced upstream prices and slow downstream demand was evidence of stability in the Isothiazolinone prices. Disruptions such as issues with maritime transportation and highway insecurity further complicated the supply chain, adding to the tightening of supplies in the US Isothiazolinonemarket.
APAC
In Q2 2024, the Isothiazolinone market in the APAC region has experienced a significant upward price trajectory, driven by several critical factors. Predominantly, increased international demand, rising freight charges, and higher input costs have exerted considerable pressure on market prices, fostering a bullish pricing environment. The sharp surge in international demand, particularly from European importers amidst a restocking cycle, has contributed heavily to this price increase. Moreover, elevated ocean freight rates, owing to unseasonal demand spikes and capacity constraints, have further compounded the upward pressure on prices. China, in particular, has seen the most substantial price changes. Domestic manufacturing activity remained robust, despite a slight moderation in the Purchasing Managers' Index (PMI) to 50.4, indicating continued expansion. However, domestic demand remained subdued, contrasting with the strong international demand, which primarily fueled the price rise. This period saw no significant plant shutdowns or supply disruptions, ensuring a stable supply chain, despite the ongoing maintenance of several refineries affecting crude oil imports. The latest quarter-ending price for Isothiazolinone MIT 14% FOB Shanghai stood at USD 1594/MT, marking a positive pricing environment throughout Q2 2024. This consistent increase underscores the resilient demand on the international front, while domestic factors played a less influential role.
Europe
In the second quarter of 2024, the European Isothiazolinone market experienced significant price decreases due to several adverse factors. This period saw declining crude oil prices, which lowered production costs for Isothiazolinone. Additionally, the market faced an oversupply from the influx of inexpensive imports from neighboring regions. Despite moderate demand from the downstream sector, the overall pricing environment remained negative as supply consistently exceeded demand. Seasonal rainy weather further reduced downstream procurement activities, impacting Isothiazolinone demand. In Germany, the Isothiazolinone market was particularly strained, with a marked decline in downstream demand. The country experienced a sharp contraction in the downstream sector for the second consecutive month, exacerbated by logistical challenges due to severe flooding, further hindering market circulation. Consequently, the German market saw the most substantial price changes within the region. The overall trend reflected a consistent downward trajectory, heavily influenced by both excess supply and weakened demand conditions. Additionally, port operations were disrupted as the Verdi trade union initiated a warning strike affecting major ports, including Hamburg, Bremen, Bremerhaven, Brake, and Emden, starting in June 2024. Workers at HHLA and Eurogate terminals in Hamburg ceased operations amid stalled wage negotiations for a new collective labor agreement, causing significant port activity disruptions as reported by German media.
For the Quarter Ending March 2024
North America
Throughout the first quarter of 2024, the Isothiazolinone market in North America maintained an upward trend. No plant shutdowns were reported, and demand in downstream industries remained stable. However, the market experienced fluctuations, notably in the USA, where adverse weather conditions like fog and wind disrupted terminal operations, resulting in shortages and global production delays.
Consequently, Isothiazolinone prices steadily increased throughout the first quarter of 2024. This upward trajectory continued into the latter part of the quarter, fueled by a consistent rise in production costs. Moreover, the USA market witnessed a rise in Isothiazolinone prices due to increased demand in the paint and coatings sector and the seasonal surge in procurement sentiments in the personal care industry.
Additionally, the anticipation of rising costs, producers' aims to recover margins, and insufficient supplies are expected to contribute to the bullish trend in the future. Despite these challenges, the pricing environment for Isothiazolinone in the North American region during Q1 2024 remained favorable, with rising prices driven by heightened demand from the downstream automotive industry and supply constraints.
APAC
The pricing environment for Isothiazolinone in the APAC region during Q1 2024 was overall negative, with significant factors influencing market prices. In China, which experienced the most significant price changes, the market was bearish due to low demand and high inventories. The domestic market exhibited low demand, while international consumption and export hurdles also affected prices. The decline in prices could be attributed to the product's availability in the market and ongoing tensions in the Red Sea, impacting cargo exports to Europe and America. Additionally, China's PMI declined, indicating a lack of demand in the country. These factors resulted in a bearish market situation for Isothiazolinone in China. Considering the overall trends and seasonality, there was a consistent decline in prices during Q1 2024, attributed to low demand and high inventories in the market. The price change from the previous quarter in 2024 was negative, indicating a further decline in prices. In conclusion, the latest quarter-ending price for Isothiazolinone MIT 14% FOB Shanghai in China was USD 1450/MT. The pricing environment for Isothiazolinone in the APAC region during Q1 2024 was negative, with low demand, high inventories, and export hurdles influencing market prices in China.
Europe
Throughout the first quarter of 2024, the Isothiazolinone market in Europe experienced an upward trend despite facing numerous challenges that affected the supply and availability of the product. These challenges included shortages in the supply chain, logistical obstacles, and market uncertainties. Additionally, increasing input costs and a shortage of pre-procured stocks further disrupted prices during the quarter. In the German Isothiazolinone market specifically, efforts to raise prices were prompted by moderate demand and limited supplier availability. This trend persisted consistently due to escalating upstream costs. Geopolitical tensions in upstream oil markets, such as infrastructure attacks in Russia and a Houthi strike in the Red Sea, raised concerns about disruptions in global tanker traffic and subsequent increases in crude oil prices. Despite constrained stock availability and rising input costs, Isothiazolinone prices stabilized in February, even though downstream procurement was insufficient and crude oil values were elevated. The regional Isothiazolinone market began the year with stable prices amid supply concerns. As a result, the Isothiazolinone trend remained consistently upward throughout the first quarter in the Eurozone.
For the Quarter Ending December 2023
North America
During the fourth quarter of 2023, the North American market for Isothiazolinone witnessed a decline in prices amidst muted downstream demand from the paint and coating segments.
This quarterly reduction was driven by reduced demand from the regional market and a high-supplied market. The USA's automotive industry experienced limited demand due to a sluggish economic recovery and stagnant trading conditions in the construction segment. In anticipation of an impending price increase resulting from a new import tariff, buyers temporarily halted their purchasing activities during this period. Furthermore, international factors, including the Russia-Ukraine war and a drought affecting the Panama Canal, added complexity to the international container logistics in the USA during the last quarter of the year.
In response to a significant drop in the spot export prices compared to contracted prices, US buyers actively engaged in discussions regarding potential reductions in the Isothiazolinone prices. Additionally, the disruptions in US shipping caused by Panama Canal issues and the ongoing decline in crude oil values also played a role in influencing pricing dynamics in the North American market during this period.
APAC
The pricing of Isothiazolinone in the APAC region was influenced by various factors during the fourth quarter of 2023. Initially, a bearish trend prevailed in the market, primarily because of diminished demand from both domestic and international markets. The oversupply situation worsened the pricing dynamics, resulting in a decline in prices. Additionally, the sluggish economic recovery and weak manufacturing activities in the region contributed to the overall low demand for Isothiazolinone. When examining specific country scenarios, China underwent the most significant price changes during this quarter. The Chinese economy faced challenges, and government efforts to stimulate growth had limited impact on the market. Domestic demand for Isothiazolinone remained low, while international consumption played a more significant role in influencing the price trend. The Lunar holidays in China provided temporary relief, but a long-term rebound in the market was still anticipated. These downward price fluctuations were mainly driven by destocking practices and low domestic demand, and no potential improvements have been seen in economic activities in the construction sector throughout the quarter. In conclusion, Isothiazolinone pricing in the APAC region during the fourth quarter of 2023 was influenced by bearish downstream market conditions, low regional demand, and oversupply. China experienced significant price changes, with fluctuations driven by domestic and international demand dynamics. The latest price for Isothiazolinone MIT 14% FOB Shanghai in China for December 2023 was USD 1700/MT.
Europe
In the fourth quarter of 2023, the European Isothiazolinone market experienced a balanced scenario characterized by moderate to high supply and modest demand in the region. The downstream paint and coating segment exhibited marginal momentum amid elevated interest rates and sluggish international off-takes, influencing commodity prices. Limited downstream demand and a cautious approach among market participants led to product price stagnancy in Germany during October. European traders and manufacturers were primarily concerned about diminished demand from the downstream industry, leading to only modest price fluctuations despite worries about disruptions in freight towards the end of the quarter. Another noteworthy aspect was the ample availability of inventories, further contributing to the negative impact on prices. The strategy of reducing operating rates to safeguard profit margins for producers and traders proved ineffective in boosting margins, given the competitive pressures from the import market. Despite production cutbacks, the Isothiazolinone market consistently faced challenges due to low downstream demand in the fourth quarter of 2023. The European Isothiazolinone market notably outperformed its global counterparts, prompting import suppliers to redirect shipments to the region during the global market downturn in the last quarter of 2023.
For the Quarter Ending September 2023
North America
In the United States, the Isothiazolinone price trend displayed an overall downward trend in the quarter ending September 2023 due to a decline in consumer purchasing sentiment amid increasing inflationary pressure on the downstream market momentum. Additionally, the downstream sector's demand from the coating industry faced significant challenges related to production as a rise in crude oil values threatened to reduce monthly in the third quarter of 2023. The cosmetics and personal care demand remained muted on account of seasonal dullness in the North American market. Hence, the decline in the price of Isothiazolinone was primarily prompted by the narrowed demand amidst a high level of pre-stocked inventories. Moreover, regional inquiries for the product had been consistently decreasing since the end of August 2023, leading to reduced pricing movement for Isothiazolinone in the quarter ending September 2023. The prices of the product this quarter were the result of ample supplies and elevated uncertainty in regional market increment along with delayed procurement sentiments amongst the consumers.
APAC
According to the most recent analysis, the Isothiazolinone prices in the quarter ending in September 2023 witnessed a decline in the APAC market, primarily driven by abundant supplies to meet the existing orders in both domestic and regional markets. Additionally, the adverse impact of a typhoon in the country had a dual effect and led to reduced downstream operational rates in line with the constrained regional demand for the product in August 2023. A decline in export inquiries for the product was prompted by the reduced enthusiasm in the international market amid elevated economic uncertainty in China during the third quarter of 2023. As September progressed, the downstream businesses concluded their pre-holiday stocking, resulting in muted demand by the end of the month. Consequently, the current decline in the prices of Isothiazolinone was prompted by the stagnation in downstream paints and coating demand and the high level of stocks to fulfill marginal orders in the Asian market, particularly at the close of September 2023.
Europe
In the third quarter of 2023, the pricing of Isothiazolinone in the European market exhibited a notable decline and primarily resulted from the reduced regional procurement activities and subdued demand from downstream sectors. This decrease in procurement, coinciding with a backdrop of heightened interest rates, resulted in a visible reduction in product consumption within the initial half of the quarter across various downstream industries. On the supply side, the pricing trajectory of the product was significantly influenced by lower operational costs observed in August 2023. Additionally, a decrease in input pressure catalyzed heightened production activities within the Eurozone market, thereby impacting the pricing dynamics of Isothiazolinone in the middle of the quarter. Furthermore, the extended summer breaks taken by businesses and consumers across Europe prompted a more cautious approach, leading to an increase in pre-purchasing activities in anticipation of the upcoming months. Despite the prevailing volatility in crude oil prices, there was an underlying expectation of a reduction in core inflation and raised concerns about the uncertainty in the downstream market and the overall offtakes in the Eurozone during this quarter.