For the Quarter Ending June 2021
Nitro Benzene had a fair demand in the North American market during this quarter, backed by firm offtakes from the downstream derivative manufacturers amid the regional scarcity. Soaring Benzene cost due to prolonged material shortage after winter devastation, amplified the prices of Nitro Benzene across USA. The demand side remained firm from the downstream derivatives such as aniline and some agrochemicals. Supply from Asia remained under pressure with players struggling to build up sufficient inventories. Therefore, a steep rise in Nitro Benzene prices was noted across North America region during this quarter.
The Asian market had fair demand for Nitro Benzene during this quarter, supported by recovering economic activities and seasonal uptrend for the product. In China, prices kept on rising due to soaring feedstock Benzene prices which reached its highest on Y-o-Y basis, and the demand from the domestic and international market remained healthy throughout this quarter. The Indian demand was buoyed by ONCB and PNCB producers in the domestic market, while some uncertainties prevailed due to rapid surge in COVID cases between April-May. Nitro Benzene demand from the domestic Aniline and agrochemicals manufacturers remained stable during this timeframe which supported its price trend. Thus, the price of Nitro Benzene hovered around USD 878/MT and USD 937/MT for China and India respectively during June 2021.
Europe faced scarcity of Nitro Benzene during this timeframe, backed by firm demand from the domestic market and tight imports. Major European traders who were regulating the overall demand for the product received enquiries from the domestic agrochemicals sectors. Nitro Benzene prices gained momentum from soaring Benzene cost due to global scarcity amidst lower imports from major manufacturing countries. In addition, rising freight cost also exacerbated the overall price hike in Nitro Benzene prices during this quarter. Therefore, to maintain the margins, traders were raising their product prices to protect their margins.
For the Quarter Ending March 2021
During this quarter, market sentiments for Nitro Benzene in USA remained high, backed by firm demand from the regional and international markets. However, the domestic output of USA was halted by sub-freezing temperatures, as major upstream plants encountered force majeures during mid-February. While the supply of Benzene remained critically low amidst unplanned plant shutdowns, prominent demand from the downstream sectors like for Aniline and MDI pushed up the regional Nitro Benzene offers.
The prices of Nitro Benzene took a sharp upturn in the Asian market, supported by strong downstream demand from Aniline manufacturers while the industry battered with critical shortage of upstream chemicals during the first quarter. Supply from the USA remained consistently low in the global market, while regular improvement in the crude oil values added an additional digit to the overall prices rise of Nitro Benzene. Meanwhile, in the Indian market prices showed substantial rise of more than 25% within the quarter and hovered around USD 1153.9/MT during March.
After the second wave of COVID-19, the European market experienced another fall in demand from the downstream sectors, as the industrial output reduced due manpower shortages amidst lockdown restrictions. Demand for Nitro Benzene from Aniline manufacturers showed marginal growth after February, as the successful roll out of vaccine paved the way for pick up in the industrial activities later in the quarter. Nitro Benzene prices showed a marginal improvement during the quarter with a considerable improvement in the upstream Benzene settlements.
For the Quarter Ending December 2020
During the October month of 2020 due to hurricane delta and Laura there were some logistics disruptions which caused a major gap in demand and supply fundaments of Nitro Benzene across Southeast Asia. The supply pressure eventually led to a two-fold increase in prices of Nitro Benzene in Q4 2020. Prices of Nitro Benzene continued to witness an upward crawl in the quarter ending December weighed the increase in prices of feedstock Benzene due to consistent increment in the values of crude. The CFR of Nitro Benzene in India in last quarter of 2020 averaged was USD 618.75 per MT.
During Q4 of 2020, prices of Benzene remained high due to its lower supply against appreciable demand across the region. Since Benzene is used as the feedstock to prepare Nitro Benzene, prices of Nitro Benzene also observed an upward climb during the last quarter of 2020. Although the demand in Q4 of FY20 was deemed low as compared to last year due to fear of new coronavirus and second lockdown across the region but was still little high with respect to the complete 2020. With revival in the values of crude, traders were heard optimistic over a substantial rebound in its values in Q1 2021.
After months of low demand for Benzene, the petrochemical market seemed to have transitioned into a recovery phase in Q4. Supplies which were stranded due to lockdown and lack of manpower during corona were pushed quickly towards their destination in the final quarter. Benzene demand remained high during December month due to consistent surge in crude values and its limited supply into the region due to a spate of hurricanes. Thus, in line with the market fundamentals surge in Benzene prices ultimately affected the supply, demand, and pricing for Nitro Benzene as well in the region.