For the Quarter Ending June 2021
During the second quarter of 2021, supplies of Polyoxymethylene (POM) in the North American region remained balanced, owing to the improvement in industrial activities. Demand remained firm as the region observed a seasonal hike in offtakes from various sectors. The efforts to replenish the inventories level was strengthened ahead of the upcoming hurricane season. As a ripple effect of the surged demand, prices observed a significant improvement with FOB Pittsburgh discussions in May reaching USD 3160 per tonne.
In the second quarter of 2021, supply in the Northeast Asian region remained tight owing to the production cut in several major plants, amidst the worsened Covid impact in the Southeast Asian region. The condition further restricted the offtakes as buyers were reluctant to purchase in bulk, due to the hovering uncertainties in the first half of the quarter. As a ripple effect of the curtailed production margins, prices remained influenced throughout the second quarter with FOB Shanghai discussions in May settling at USD 2185 per tonne.
The supply tightness in the European persisted throughout the first half of the second quarter of 2021 but was later balanced, owing to the improved availability of upstream. Moreover, some easiness was witnessed due to the improvement in the imported volumes from the overseas market. Suez Canal blockage delayed the Asian and Middle Eastern cargoes during the start of the second quarter. Demand of POM remained consistent from the automotive and medical sector, despite the chipsets shortage and low production rates of automobiles the European region.
For the Quarter Ending March 2021
The North American Polyoxymethylene (POM) market remained extremely tight during the first quarter, as the region faced several plant shutdowns as a repercussion of the freezing weather conditions in the USA Gulf region. The temporary calamity led to severe shortage of the key feedstock Methanol in the region. Exports to other regions were severely impacted as the local supply-demand gap widened in the Q1 2021. Demand declined steeply as the automotive production sector was severely hampered amid the winter storm. Extending gains from the raw material rates and global supply shortage, the prices of DURACON grade of POM gained by +USD 300 per ton.
Supplies in the region remained balance during the first quarter of 2021, due to the export hindrances in several Northeast countries which were counterbalance by the supplies from countries like China. Several plant turnarounds in Malaysia in duration of February and early March, exerted tremendous pressure on the supplies. However, normal production rate in Chinese plants balanced out the situation. Demand segment strengthened during the first quarter due to better offtakes from the recovering automotive sector sales, followed by surged imports to the western regions.
Supplies remained balanced to tight in the first quarter of 2021, in European region. However, the hindrance in supply chain of the key feedstock Methanol due to the transportation lag in Amsterdam-Rotterdam-Antwerp route in European region curtained the local operations. Demand surged as the offtakes improved from the downstream automotive and pharmaceutical industry, buyers were observed replenishing their inventories due to strengthened demand amid uncertain market conditions.
For the Quarter Ending December 2020
The demand for Polyoxymethylene has witnessed an appreciable surge moving from Q3 to Q4 of 2020 due to the significant revival in market fundamental of downstream industries like construction industry, pharma industry and trading companies indicating a remarkable economic revival in the Asian markets. Although the demand was deemed rich during October and November, but it observed slight increment moving into December due to the unprecedented increment in shipping charges which caused the traders to pay high amount during the exchange. This abrupt freight surge ultimately increased the demand for its other available alternatives in the regional area.
Even after the fears of new Coronavirus strain following the partial lockdown in several parts of the region, the demand for Polyoxymethylene remained stable-to-firm range due to restocking activities of polyoxymethylene by buyers to combat any damage to consumer sentiments amidst its ample demand. To compensate for the regional shortage, there were fewer imports from the Asian region too. With the demand being steady, the prices of Polyoxymethylene witnessed much fluctuation during the fourth quarter of 2020.
Hampered by the new strain of corona virus, the North American markets again took a twist as the sales of downstream electrical and electronic items especially smart phones saw a decline of 6% in fourth quarter of 2020. In response, the demand of Polyoxymethylene did not witness an increase as expected even after the announcement of corona vaccine roll out. Although the demand for Polyoxymethylene remained stagnant, its prices showcased marginal fluctuation due to volatile shipping charges in the final quarter.