Quarterly update on Masterbatch Market
For the Quarter Ending June 2021
North American market witnessed a huge rise in demand for Masterbatch during this quarter, backed by firm offtakes from the regional polymer manufacturers. Entering Q2 2021, demand for several polymers revived and the consumption improved significantly in USA. However, the supply activities remained inadequate to satisfy the overall requirement of polymers in the country. Transportation issues also remained a major concern for the manufacturers, which disrupted the supply activities and polymer manufacturers faced shortage of raw materials especially in. Therefore, overall demand for masterbatch remained firm throughout the quarter across North America region.
Asian market witnessed mixed sentiments for masterbatch during this quarter, as the demand varied country over country. In China, economic rebound in the country, bolstered the demand for Masterbatch throughout the quarter, while the domestic consumption from polymer sector also increased in the meantime. On the other hand, in India, demand for polymers declined during the month of May, under the influence of second wave of Covid in the country. However, this demand improved later in June post the decline in new Covid cases. This revival in demand improved the consumption of Masterbatch in the country during June 2021 and thus supported its prices.
Europe encountered firm demand for Masterbatch from the regional polymer market, as the overall demand for polymers improved effectively compared to the previous quarter across the region. In addition, rise in freight cost and other logistical issues halted the overall supply activities for polymers across the region. Therefore, amid stable offtakes for Masterbatch from the polymer sector during Q2 2021, prices remained in a stable to firm range.
For the Quarter Ending March 2021
The North American market faced firm demand for Masterbatch from several downstream segments. However, the production output of several polymers like PVC, PP, LDPE, HDPE etc remained critically low, especially during February which capped the consumption levels. Winter cold snap in the gulf of USA halted production activities across the region, which was the primary reason behind this lower output. Despite of this, demand for Masterbatch remained ideally stable across the region, that helped the prices to maintain stability throughout the quarter.
The Asian market encountered firm demand for Masterbatch from the downstream segments. Demand for polymers such is PVC, PP and PE remained high during the quarter, which propped up the demand for Masterbatch across the region. In the Chinese market, demand and production was temporarily halted during Lunar New Year holidays, which reduced the domestic demand for around 2 weeks, accelerated the prices of Masterbatch temporarily. In addition, sufficient improvement in the demand for polymers in the Indian market affectively improved the demand for Masterbatch in the country.
Europe encountered firm demand for Masterbatch during March after sufficient recovery from second wave of COVID 19. However, COVID restrictions in some European countries affected the demand as well as supply across the region. In addition, US gulf storm also reduced the trade activity between these two regions, and reduced the adequate availability of raw materials to satisfy the overall polymer demand. However, rapid vaccination drive, helped the market sentiments to improve efficiently till end of the quarter.
For the Quarter Ending December 2020
With a V-shaped economic recovery in Q4 2020 coupled with the festive demand in India, market sentiments for Masterbatch in the concerned quarter considerably improved. Plastiblend, a leading manufacturer of Masterbatch in India reported that due to the appreciable revival in market activities, their sales reached an all-time high in the quarter ending December. In line with a preferential improvement in the market fundamentals, prices of Masterbatch also revived in the final quarter after being badly hit during the pandemic. As per Polyblend, demand for black and white masterbatch reached an all time high with improved in demand the consuming segments like automotive and construction. China also witnessed appreciable demand for Masterbatches amidst the appreciable offtakes from downstream plastic and construction industry.
Demand for Masterbatch remained firm in Q4 2020 weighed by the consistent surge in demand for downstream plastics. Although indefinite turnarounds implemented in several downstream polymer units under the spate of hurricanes in October impacted its overall demand fundamentals. Demand for black and white masterbatches from automotive industry marginally revived in comparison to the previous quarter but was still deemed low with respect to the pre pandemic levels. However, with heavy optimism prevailing from the upward crawl in crude values, manufacturers have remained optimistic over its demand recovery in the coming months.
Weak economic environment due the trace of New Coronavirus in several parts of the region led to a gradual decline in demand from Masterbatches from downstream industries. Since the supply remailed ample against its feeble demand, Masterbatch prices in several parts of the region lost grounds. As of November, operations in various industries of Europe tumbled under the force majeures implied on fears of new Coronavirus. Thus, overall revenues from the Masterbatch segment also dropped with respect to the previous quarter.