For the Quarter Ending March 2025
North America
In Q1 2025, the Methylene Diphenyl Diisocyanate (MDI) market in the North American region experienced a generally positive price trend, driven by a mix of supply constraints and stable demand. Early in the quarter, production challenges, including disruptions from the Arctic Blast and supply chain delays, contributed to upward pressure on prices. The availability of key feedstocks, such as Benzene, was affected by rising demand in other sectors, further elevating production costs.
Despite these challenges, demand for MDI remained steady, bolstered by the automotive sector's recovery, especially with increased sales of light trucks and electric vehicles. The construction sector, while showing slower growth due to rising material costs and labor shortages, still contributed to a stable demand for MDI in insulation and other building materials.
Geopolitical tensions, particularly trade negotiations involving tariffs on North American goods, added uncertainty to the market, impacting trade flows and further straining the supply chain. As the quarter progressed, these factors balanced out, leading to a stabilization in prices toward the end of March, with moderate growth expected in the coming months.
APAC
During the first quarter of 2025, the Methylene Diphenyl Diisocyanate (MDI) market in the Asian region experienced a mixed trend, with fluctuations in both prices and demand across the region. Initially, prices remained firm due to the Lunar New Year holidays in key regional producer China. After that, a bearish momentum took hold. The weakening demand from key downstream sectors such as construction and automotive, driven by a significant decline in property sales, put downward pressure on prices. The construction industry saw a reduction in demand for MDI-based materials like insulation due to lower real estate investments. While electric vehicle (EV) sales provided some support to MDI demand, the overall decline in internal combustion engine (ICE) vehicle sales, coupled with weaker automotive performance in regions like Thailand, contributed to the bearish market sentiment. On the supply side, production remained stable, with feedstock Benzene availability supporting steady output. However, fluctuations in feedstock costs due to crude oil price volatility and trade-related disruptions, including new U.S. tariffs and China’s retaliatory measures, complicated the supply chain. By the end of the quarter, rising inventories and muted demand forced producers to reduce prices, with MDI quotations dropping significantly. Despite some isolated demand growth in Southeast Asia, the overall market sentiment for MDI in Asia during Q1 2025 remained largely bearish.
Europe
Like the North American region, the Methylene Diphenyl Diisocyanate (MDI) market in Europe experienced a bullish price trend in Q1 2025, largely influenced by supply disruptions, geopolitical factors, and steady demand from the automotive sector. Early in the quarter, MDI prices saw an upward movement, driven by rising production costs stemming from limited availability of Benzene, as well as seasonal weather disruptions at European ports that tightened supply. Despite these challenges, the automotive sector continued to provide stable demand, supporting MDI prices. In contrast, the construction sector faced ongoing difficulties due to inflationary pressures, high material costs, and reduced activity. Geopolitical factors, including U.S. sanctions on Iran and potential tariffs on European goods, further complicated supply chains and price volatility. In the latter part of the quarter, MDI prices showed signs of stabilization, but ongoing disruptions, including strikes at key European ports and logistical issues, continued to hinder smooth delivery schedules. By the end of the quarter, despite some regional growth in Italy’s construction sector, the overall market sentiment shifted towards a more cautious outlook, with weaker demand from both the automotive and construction sectors, signaling a bearish trend moving into Q2 2025.
For the Quarter Ending December 2024
North America
In the fourth quarter of 2024, the Methylene Diphenyl Diisocyanate (MDI) market saw a decline, driven by reduced demand from the construction and furniture sectors. Weak consumption and high inventory levels in these industries, combined with slower purchasing from polyurethane manufacturers, contributed to a more subdued market. While demand from the automotive sector remained steady, the overall market activity was less dynamic, reflecting the broader slowdown.
MDI production remained stable throughout the quarter, but a decrease in feedstock Benzene prices and falling crude oil prices put downward pressure on production costs. Additionally, supply chain disruptions and a reduction in export orders, particularly from Europe and Australia, further dampened market sentiment.
Compared to the previous quarter, the market experienced a 2% decline. This was largely due to weaker demand in key sectors like construction and reduced export activity. Despite growth in the automotive sector and continued interest in environmental coatings, the overall momentum in the MDI market slowed, mirroring broader trends in industrial activity and global demand.
APAC
In the fourth quarter of 2024, the Methylene Diphenyl Diisocyanate (MDI) market showed mixed performance. MDI production remained stable, supported by moderate feedstock availability, while demand from the automotive sector stayed strong, driven by continued growth in new passenger vehicle registrations. However, the construction sector faced challenges, with weakened demand due to subdued activity and a contraction in business sentiment, especially in November. Compared to the previous quarter (Q3 2024), MDI demand shifted. The automotive sector continued its positive trend, bolstered by consistent polyurethane demand, while the construction sector experienced a decline, reflecting a slowdown in construction activities. Exports grew, but at a slower pace, particularly to key markets like the U.S. and European Union, as tariffs remained a concern. Overall, while demand from the automotive and paints & coatings sectors remained firm, the market experienced slower momentum in Q4. This was driven by weaker construction sector activity and slower export growth, leading to a more balanced market compared to the previous quarter.
Europe
In the fourth quarter of 2024, the Methylene Diphenyl Diisocyanate (MDI) market saw a 4% decrease compared to the previous quarter. MDI production remained steady, but low export levels and rising domestic inventory contributed to the decline. Demand for MDI in the construction sector weakened due to ongoing economic and political uncertainties, while the automotive sector showed mixed trends. Although car registrations increased initially, demand in the automotive sector slowed by December. Feedstock costs for MDI production, particularly Benzene and Aniline, decreased, which helped ease production costs. However, these lower feedstock prices did not fully offset the reduced demand. Shipping capacity issues, particularly to Northern Europe and the Mediterranean, led to lower export volumes and further increased regional inventory levels. The Polyurethane sector showed sluggish demand, especially in the construction industry, where housing activity contracted significantly. While the automotive sector had some demand growth, it was not enough to offset losses in other areas. Inflationary pressures and slower overall economic growth in the Eurozone contributed to the decline in MDI demand, marking a challenging quarter for the industry.
For the Quarter Ending September 2024
North America
In Q3 2024, the Methylene Diphenyl Diisocyanate (MDI) price trend showcased bullish movement in the North American region. Prices witnessed a notable increase, driven by a combination of factors influencing the market dynamics. Factors such as steady demand, limited supplies, and cost support from feedstock Benzene contributed to the overall bullish market sentiment, highlighting a stable and robust pricing landscape for MDI in the region.
In the middle of the third quarter, MDI production rates were hampered because of the stressed availability of feedstocks in the region. The offtakes were moderate, and market players raised their quotations. The correlation in price changes demonstrated a positive sentiment, with a 4% increase noted between the first and second half of the quarter.
Towards the end of Q3, the impact of Hurricane Helene resulted in reduced manufacturing activities in the region and a reduction in domestic stockpiles amid affected supply chain activities. The market players raised their quotations, and the overall quarter-on-quarter percentage change of 7% further solidified this growth trajectory in Q3 2024. Conclusively, the quarter-ending price for MDI Polymeric Grade DEL Texas in the USA witnessed USD 2630/MT.
APAC
In Q3 2024, the Methylene Diphenyl Diisocyanate (MDI) market in the APAC region has been characterized by a fluctuating pricing environment. The quarter has witnessed significant influences from factors, like increased feedstock Benzene costs due to fluctuating crude oil prices, moderate demand from downstream industries, and improved manufacturing activities. The market's dynamics were further complicated by supply chain disruptions amid the impact of seasonal factors like monsoons and typhoons and geopolitical tensions affecting crude oil imports, leading to variable feedstock availability. During the mid-quarter, the looming concerns about a recession in the US affected the international crude oil market and refinery operation. It stressed the feedstock Benzene and Aniline supplies and MDI production rates. MDI prices fluctuated and decreased marginally towards the end of the quarter, and the price comparison between the first and second half of the quarter showed a negative change of 1%. Simultaneously, offtakes for moderately low from the PU segment during the period. Conclusively, from the previous quarter in 2024, prices negligibly fell by 1%, indicating a downward trend, and MDI Polymeric Grade FOB Qingdao prices in China settled at USD 1970/MT at the end of quarter 3 of 2024.
Europe
Like the North American region, the Methylene Diphenyl Diisocyanate (MDI) pricing in the European market has followed an upward trajectory throughout the third quarter of 2024. The market has been influenced by stable demand from downstream industries, particularly the Polyurethane segment, despite weak production rates, with a consistent decline in the Eurozone Manufacturing PMI Index. Supply-side dynamics also played a role, as supply availability was moderately low during summer holidays creating imbalanced demand-supply dynamics, yet demand failed to match this increase, as The Eurozone's construction sector continued its downturn, significantly impacting MDI consumption. Seasonality played a role as summer holidays resulted in labor shortages and reduced manufacturing rates, impacting supply chains. Additionally, concerns about a potential recession in the US affecting the international crude oil market and refinery operations have led to a shortage of feedstock supplies, impacting MDI production rates. Conclusively, the quarter concluded with an MDI Polymeric Grade FD Rotterdam price at USD 2470/MT in the Netherlands, after an overall 3% increase from the last quarter's prices, indicating a consistent upward trend.
For the Quarter Ending June 2024
North America
In Q2 2024, the Methylene Diphenyl Diisocyanate (MDI) price trend oscillated in North America. Initially, the price trend was firm, and prices rose due to increased production costs. As per EQT, the energy sector witnessed escalations in production costs due to geopolitical tensions and positive economic data. Meanwhile, the market showcased mixed demand for MDI from the Polyurethane segment.
During the mid-quarter, MDI prices declined, and several significant factors influenced this decline. Predominantly, the reduction in demand from the construction sector adversely impacted MDI prices. This sector faced reduced spending and higher borrowing costs, which led to lower offtakes of Polyurethane materials used in construction applications. Moreover, the automotive sector's sluggish consumption of Polyurethane products due to the increased supply of Chinese electric vehicles further exacerbated the declining demand for MDI. Additionally, the cost support from feedstock Benzene and Aniline fluctuated, impacting the production costs and subsequently influencing MDI pricing.
The U.S. market saw a -19% price change compared to the same quarter last year, indicating a significant decline. Prices also fell by 7% from the previous quarter in 2024, reinforcing the downward trend. A comparative analysis of the first and second halves of the quarter showed a -2% price change, emphasizing the ongoing decline. By the end of the quarter, MDI Polymeric Grade DEL Texas prices were at USD 2420/MT, reflecting the overall negative pricing environment. The price decrease was driven by persistent supply-demand imbalances and fluctuating feedstock costs, highlighting the market's deteriorating conditions in Q2 2024.
APAC
In Q2 2024, the Methylene Diphenyl Diisocyanate (MDI) market in the APAC region underwent notable changes due to several factors. Initially, MDI prices fell due to reduced purchasing activity, driven by subdued demand in the Polyurethane segment and lower trading volumes in the market. At the same time, cost support from feedstock Benzene decreased because of declining upstream Crude Oil prices and reduced consumption rates. Mid-quarter, prices increased as production rates were affected by limited availability of feedstock Aniline, due to previous production cuts and heightened demand from the pharmaceutical sector strained supply chains. Concurrently, demand for MDI surged as buyers stockpiled in anticipation of the monsoon season and increased production of Thermoplastic Polyurethane for PU sole footwear. This seasonal boost, combined with steady offtake from the Polyurethane industry, provided strong support for market prices. However, the construction sector’s increased demand for Polyurethane materials further propelled prices upward. Overall, MDI prices in China rose by 16% compared to the same quarter last year, reflecting significant year-over-year growth. Prices also climbed by 4% from the previous quarter in 2024, indicating a steady quarterly rise. The first and second halves of the quarter showed a 5% price differential, underscoring a consistent upward trend. By the end of the quarter, MDI Polymeric Grade FOB Qingdao was priced at USD 2015/MT, marking a considerable increase and reflecting a positive pricing environment.
Europe
In Q2 2024, the Methylene Diphenyl Diisocyanate (MDI) market in Europe saw a significant increase in pricing dynamics due to several key factors. A major influence was the limited supply of Aniline feedstock, caused by reduced production rates and heightened demand from the pharmaceutical sector. At the same time, feedstock Benzene prices rose because of increased demand from the downstream value chain and higher upstream Naphtha prices. This combination of constrained Aniline availability and rising Benzene costs significantly impacted MDI production expenses, driving up market prices. In Germany, these factors led to the most pronounced price fluctuations in the region. Seasonal increases in automotive production further boosted demand for Polyurethane, putting additional strain on supply chains already affected by geopolitical tensions and labor shortages. Despite these challenges, market sentiment remained relatively stable, with a 6% price increase from the previous quarter, signalling a recovery from a notable -27% change compared to the same quarter last year. Throughout the quarter, MDI prices exhibited a consistent upward trend, with a slight 1% rise between the first and second halves. These trends reflect ongoing demand and tight supply conditions. By the end of the quarter, MDI Polymeric Grade FD Hamburg prices were at USD 2500/MT, indicating a cautiously optimistic market environment. Overall, the pricing landscape was positive, driven by supply constraints and strong downstream demand, suggesting a cautiously bullish outlook for the European MDI market.
