For the Quarter Ending September 2021
North America
During the third quarter of 2021, prices of Polyols continued to follow an upward climb tracing the trend of the previous quarters. Inventories remained low as demand for the material strengthened. Furthermore, downstream Polyurethane consumption continued to garner strong numbers which exerted pressure on upstream Polyol prices. Moreover, BASF imposed a temporary turnround at its production site in Geismar, Louisiana which was primarily involved in the production of TDI, MDI and polyols. Besides, several other plant shutdowns came in the aftermath of hurricane Ida which devasted southern states. Prices of polyol after conclusion of Q3 were assessed in the range of USD 4400 – 4500 per MT on FOB basis.
Asia
In Q3 2021, tight supply dynamics of feedstock TDI in China due to planned turnarounds in Shanghai and North China hindered Polyol production in the region in Q3. China has been a critical exporter of material in overall South Asia, thus constrained production in China has translated into price hikes in other countries including India as well. In India, Polyol prices continued to strengthen imitating global trend throughout the quarter. Supply chain disruptions and logistics issues limited the availability of the material in the market that directly exerted pressure on the Polyol market in India and hence fumed its prices.
Europe
During the third quarter of 2021, tightened feedstock supplies continued to hinder Polyol production in Europe. In this quarter, Covestro announced force majeure at its 200 KTPA MDI Brunsbuttel, Germany in early stages of the quarter. Inventory were measured at low levels, weather calamities in the region worsened logistics problems as well as curtailed production of the feedstocks. Covestro and BASF struggled for production in the backdrop of limited availability of raw materials that directly contributed to the inflation in the prices of Polyol in the region.
For the Quarter Ending June 2021
North America
Critical shortage of polyols in USA led to a steep rise in its prices during this quarter, supported by high demand from downstream Polyurethane (PU) sectors. Major downstream PU manufacturers were facing extreme shortage of upstream Polyether polyols, and traders were unable to complete their backlog orders. To rectify this extreme shortage, downstream manufacturers of USA had to import high-priced cargoes from Asia to keep their factories functioning. However, the supply activities, improved slowly by the end of the May as the production activities recovered effectively which were halted since Q1 due to winter devastation. Thus, the offers for Polyether Polyols (MW 3000) price hovered around USD 3915/MT during the final week of June in USA.
Asia
The Asian market witnessed firm sentiments for the product during this period, while the shortage of different grade polyols remained persistent throughout the quarter in all the Asian countries. China based manufacturers, revealed that they had firm demand from domestic and international market during the timeframe, while the availability remained tight. In addition, critical shortage in USA, also bolstered the export demand from China, as supplies were globally tight. Meanwhile in India, prices kept tumbling throughout the quarter, as the demand from the downstream manufacturers reduced effectively under pandemic mayhem. Despite of low spot availability, the prices declined and reached USD 2167/MT for Polyether Polyols during June in India. Chinese polyol prices showed some ease QoQ with Ex-Works Qingdao offers settling at USD 2520 per MT for Polyester polyol.
Europe
Tight supply of polyols in Europe led to an effective rise in the international pricing of the product during Q2 2021. The demand for Polyether polyols remained firm throughout the quarter from the downstream PU segments, while due to global shortage, availability remained inadequate to satisfy the overall demand of the region. In addition, manufacturers were expecting hike in demand from the construction and automotive sector, as the economic activities were picking up the pace. Manufacturing of mattresses picked up with the strong economic rebound noted in Q2 and a large European population spending on home furnishing.
For the Quarter Ending March 2021
North America
The North American market struggled to find balance during Q1 2021, due to winter cold spells faced across the US gulf coast leading to several plant turnarounds. The prices of several polymers and feedstock chemicals were rising due to affected production during the period. Plants of several Polyol producers including DOW and Covestro remained idled during mid of January to end of February. In addition, they have also stated that the production will remain slow due to lower availability of feedstock materials. Dow resumed the operations at its Polyol, Polyurethane, Propylene Oxide, Propylene Glycol, MDI, TDI manufacturing plants during mid-March. Responding to escalation in raw material rates and tightened market supply, Dow increased the prices of its Voranol, Voralux and Specflex Polyol grades by around USD 154.5 per MT with effect from Feb.
Asia
In the Asian markets, Polyols prices experienced a consistent increment throughout the quarter, amid supply shortages and firm demand from the domestic market. Regional output of APAC increased as several upstream plants woke up again after turnarounds in Q4 2020. Lunar holidays hindered the production and consumption of Polyols in China. Although the global supply was disrupted due to winter storm across the US gulf amid fair demand from other regions, which ultimately led to rise in price of Polyols across the region. In India, average price of polyols rose by more than 23% within the quarter. However, it is anticipated that the price acceleration may stop in forthcoming quarter.
Europe
The European market experienced adverse effect of winter storms in the US, and container shortages across major trading routes. Although the regional demand for Polyols remained firm during the period, but supply remained tight due to global shortages. As an effect, price for several Polyol grades skyrocketed during the quarter. Amidst tightened supply, Perstorp, a major global polyols supplier announced to increase the prices of nearly 12 different Polyol products across Europe, Middle East and Africa region, with surges ranging between USD 237.45 per MT to USD 474.89 per MT.
For the Quarter Ending September 2020
Asia
Supply of Polyols remained snug throughout the quarter as steep climb in feedstock prices in China pushed back some of its manufacturers from utilizing their full capacities. Amidst the limited supply, several traders were heard offering Polyol cargoes at premium to incur optimum gains from these market uncertainties. With ease in majority of containment restrictions, offtakes of Polyol cargoes from Southeast Asia showcased major revival in comparison to the last quarter. Despite the antidumping probe imposed on the cargoes of foam mattress originated from Southeast Asia, traders reported of steep increment in demand from the US buyers. In the overall Asian market, buyers were seen restocking Polyol cargoes amidst fears of consistent hike in its feedstock prices in the coming months. Projecting a consistent increment since July, Polyester Polyol Ex-Depot prices on CFR India basis were averaged at USD 1942 per MT in the quarter ending September.
North America
As production rates were curtailed in Q2 due to languished demand, the availability of Polyol remained tight in the third quarter. Plant operating rates were adjusted in July keeping in mind that the demand is likely to stay dampened in the coming months. However, contrary to the perceived notions, the demand for Polyols recovered way faster in Q3 2020 which eventually resulted in a huge dropdown in inventory levels. Better offtakes from segments such as bedding, and furniture helped in achieving sales figures close to the pre lockdown levels. Furthermore, astonishing revival of the automotive sector considerably push up the market fundamentals in North America by the September end.
Europe
Mixed supply sentiments were observed for Polyol in the European market as the unexpected demand recovery surpassed the overall production of Polyols in the region. The supply of Polyols further tightened with reported shortage of feedstock Ethylene Oxide due to issues prevailing in Shell’s Moerdijk cracker and other upstream outages heard across the region. Higher Polyol prices in Asia made European Polyol producers optimistic over enhanced export demand to Middle East. However, slow recovery in the downstream automotive sector affected the quick revival in the European region.
