For the Quarter Ending June 2022
The overall market outlook of n-butylene and Iso butylene showed an upward trend in Q2 of 2022 across the North American region. Prices of USA Isobutylene have continued to increase instead of a hampered material supply. Demand fundamentals have been floating throughout the region as downstream Polyisobutylene, and Butyl Rubber industries attempt to maintain the balance. However, supply witnessed disturbing dynamics in the country on the back of high input costs that led producers to boost the price of materials for domestic and international converters. Furthermore, global inflation has caused n-butylene and isobutylene prices to rise. Furthermore, the United States imports a portion of its consumption from Asian and European producers. As a result, expensive imported cargoes bolstered the increasing price trend of n-butylene and Isobutylene in the US market. As a result, increased product cost partially surpasses customers' cost burden to protect their profit margins.
n-butylene and Isobutylene showed positive market sentiments in the Asia- Pacific region during Q2 of 2022. In addition, high raw material Tertiary Butyl Alcohol has the other facts for the price surge in the domestic market. Additionally, China's manufacturing activity expanded at its fastest rate, buoyed by a strong output rebound as pandemic restrictions were lifted, sending factories racing to meet recovering demand. Moreover, the subindex for production rose to its highest level since November 2020, while the first increase in export orders boosted new orders. After worsening for the past two years, supplier delivery times stabilized in June amid easing supply chain snags. Despite the strong rebound, factories remained cautious about hiring more workers, with employment falling. In addition, high inflationary pressure further supported the increased prices of the product. However, demand from the downstream for the fabrication of Butyl rubber and Polyisobutylene industries has remained steady.
During the second quarter of 2022, prices of n-butylene and Isobutylene have continued to rise in the European region, backed by the rising raw material cost, notably Tertiary Butyl Alcohol, and limited availability in the domestic market. Furthermore, the consequences of the ongoing energy crisis amidst the Russia-Ukraine war have further affected the product prices across the regional market. At the same time, the Producer Index (PI) was still hanging at a mounting level, forcing manufacturers' pockets. In addition, European energy prices have shot up coincided with the rising labour expenses, triggering concern among regional manufacturers. In addition, demand for Isobutylene in the fabrication of Butyl rubber and Polyisobutylene has remained stable to weak.
For the Quarter Ending March 2022
In the first quarter of 2022, sentiments about n-butylene and isobutylene in North America were divided. Prices grew at the start of the quarter, then seesawed afterwards. Upstream crude oil prices have been impacted by the ongoing conflict between Russia and Ukraine, resulting in a supply shortfall that has weighed on the high cost of n-butylene and isobutylene in the domestic market of the United States. Because of the drop in crude oil prices, prices fell marginally in February. The price drop was linked to the abundance of inventory levels in February, which later decreased. In the first quarter of 2022, demand from downstream tire industries and gasoline additives fluctuated as well. As upstream crude and natural gas prices rebounded in the final month of the quarter, n-butylene and isobutylene prices jumped by 11% as compared to the last quarter of 2021. During March, the prices of n-butylene and isobutylene FD Texas were set at USD 1050/MT.
n-butylene and isobutylene showed good market sentiments in the Asia-Pacific area during Q1 2022, in contrast to the last quarter of 2021. The ongoing conflict between Russia and Ukraine has had an influence on upstream crude oil prices, resulting in a supply deficit that has weighed on n-butylene and isobutylene pricing in the Indian market. Strong demand from the tire and gasoline additives industries prompted businesses to increase their operating rates to protect revenues in the first quarter, affecting the market values of widely used raw materials such as n-butylene and isobutylene. In addition, rising freight rates owing to a container shortage aided the region's high n-butylene and isobutylene prices. Due to a scarcity of inventory in the domestic market, producers have been unable to meet local demand despite strong demand from the tire industry. During the March 2022, isobutylene ex-Mumbai was assessed at USD 1666/MT, while n-butylene ex-Mumbai was assessed at USD 1155/MT.
During the first quarter of 2022, n-butylene and Isobutylene prices in Europe continued to rise. High upstream crude oil prices, as well as a regional supply scarcity as a result of the Russia-Ukraine conflict, had a substantial impact on production rates and operational costs. Furthermore, as n-butylene and isobutylene are utilised in the production of elastomers, strong demand for them from tire and fuel additives has driven up prices. Furthermore, due to high energy prices in the European region, certain production units reduced their running rates. In March 2022, isobutylene prices were assessed at USD 1115/MT, up 6% over the previous quarter.
The overall market outlook of n-butylene and Iso butylene showed an upward trend in Q4 of 2021 across the North American region. Crude C4 value continued to increase due to shortage of natural gas as N-butylene was produced in Crude C4 refinery system Therefore, the overall prices of n-butylene increased across the regional market. The product price slightly declined in December due to short term ease in the price of crude oil. Meanwhile, New Year occasion and surging case of Omicron towards the last week led to temporary halt transportation and resulted into rise in the product price. However, Demand for n-butylene and isobutylene from the downstream auto-manufacturing industry remain stable in the US market during Q4.
The domestic price of n-butylene and Isobutylene showed fluctuations in the Asia pacific region during the Q4 of 2021. Demand was increased from the downstream rubber industries with increasing utilization of natural rubber which hinder offtakes of Isobutylene in China. In the Indian market, variation in the price of upstream crude oil industry caused upward pressure on inflation and increased the cost of input for several industries which caused the transportation expensive and high freight charges. In the End of December, the price of n-butylene and iso-butylene slightly decrease the demand from downstream sector remains same.
All over the region, the market trend kept on fluctuating throughout the Q4 of 2021. High price of feedstock, such as Ethylene and Isobutane led to price increase for n-butylene and Iso butylene in the regional market. Additionally, increased in the price of crude oil, due to high consumption post increase in vaccination rate of Covid -19 and relaxation in pandemic related restriction also remained a major factor behind rising production cost in the regional market. Economic recovery in the regional countries resulted into rise in global petroleum demand, contributed to soaring input cost for several commodities including n-butylene and Isobutylene.