For the Quarter Ending June 2021
Prices of Paraffine Wax remained in a narrow range during this quarter across North America region, backed by high inventory levels. Due to the polar storm in last quarter, production of Paraffin Wax remained low in the country. However, availability remained abundant to tackle any demand from downstream cosmetics and candle manufacturers. Despite of slow refinery rate, older stocks was so abundant that led to an overall slump in the prices of Paraffin Wax in the country. Therefore, price of Paraffin wax tumbled effectively settling at around USD 1355/MT for light grade in Texas.
Paraffin wax prices varied with country over country in Asia during this quarter. In China, prices traced an upward trajectory due to sturdy domestic and cross border demand against the tight supply. While in India, after April, prices started declining in effect of rapid upsurge in pandemic cases in the country. To curb the spread country-imposed movement restrictions, which plunged the overall demand from cosmetic market. Therefore, prices of Paraffin Wax declined in India and climbed up in China, and eventually reached USD 1283/MT and USD 1307/MT respectively for India and China during end of June.
Europe experienced an overall stability in Paraffin Wax market, while the demand remained steady throughout the quarter. Post decline in COVID pandemic in major European economies, demand for Paraffin Wax started rebounding from regional cosmetic, candle, and coating sector. However, stocks remained abundant to satisfy the overall requirement of the market, which led to an overall stability in prices while facing some fluctuations under demand supply gap.
For the Quarter Ending March 2021
In line with the rise in demand from downstream industries, Asian paraffin wax market witnessed a fair recovery during Q1 2021. This demand for Paraffin wax remained stable till January, which later during February and March observed a further pickup due to significant recovery in service sector. This improved demand mainly came from cosmetics, packaging and candles making segments which enhanced the market sentiments and hence supported the prices of Paraffin wax in Asian market. Accordingly, CFR India prices for Paraffin wax rose from USD 1046 per MT (January 2021) to USD 1095 per MT (March 2021). Meanwhile, Indian Oil Corporation announced to expand its Chennai refinery in collaboration with Chennai petroleum corporation ltd, which will cost around USD 4298.2 Million.
North America region faced challenges to satisfy the demand for Paraffine wax during Q1 2021, although the demand remained below the expectations. The reason behind this fall was disrupted plant activities, due to winter storm in gulf during Q1 2021 and multiple plant shutdowns due to the spate of hurricanes in Q4 2020. Owing to the limited manufacturing activities, feedstock base oil prices skyrocketed during January and February, although improvement in manufacturing activities during March stopped this price acceleration across the region.
After months of stagnancy and depressed market, European paraffin wax witnessed a fair flight during Q1 2021. Construction and paper manufacturing sector improved by 4-5% compared to Q4 2020. Furthermore, with vaccination drives running in several European countries like UK and France, manufacturers remained optimistic regarding the demand for paraffin wax from downstream sectors in the near term. Meanwhile, during March end, Total dropped the plan to resume its France base oil production plant, due to low demand for feedstock Base Oil.
For the Quarter Ending December 2020
Festive season in Asia during final quarter of 2020, raised the demand of Paraffin wax from different sectors. Fairly improved demand of Paraffin wax from industries like cosmetics, packaging and candles enhanced the market sentiments and supported its prices. In India, CRF price of Paraffin wax were said to improve from USD 964.16/tonne in October to USD 997.27/tonne in December. Similarly, other Asian countries like China and Korea reported resilient demand for Paraffin wax post COVID-19 recovery. Improved crude oil values also supported the prices of Paraffin wax during Q4 2020 in the Asia pacific region.
Amid fair recovery in industrial activities and businesses across the region, the demand of Paraffin wax from the packaging and cosmetic sector was moderately improved during Q4 2020. Although multiple refineries were kept on low capacities and many of them remained completely non operative, demand-supply situation seemed somewhat balanced during the quarter. In addition, Royal Dutch shell was heard closing its Louisiana refining facility due to malfunction, which is one of the largest facilities in USA. This shut down may have a significant impact on Paraffin wax supply across the region.
The European Paraffin wax market remained low on sales and experienced stable growth from the construction and paper manufacturing sector. Although the demand for Paraffin wax improved from cosmetic industries compared to prior quarter. Meanwhile, the COVID-19 restrictions affected the activities of multiple refining units and that reduced the overall availability of Paraffin wax which has already been dealing with slackening demand. On other hand, some countries like UK announced complete lockdown and implemented COVID-19 restrictions that induced the downward trend in demand fundamentals.