For the Quarter Ending March 2022
Owing to stable demand from the local market, the North American Silicate market witnessed frequent ups and downs. As global economic activities regained from the pandemic's critical phase, demand for the commodity held steady in the downstream paper and construction sectors. However, the rapid escalation of the Russia-Ukraine dispute hampered overall flow and brought uncertainty into the global market. Manufacturers were pushed to increase their product prices to maintain margins due to trade disruptions and growing wage inflation on consumers thanks to increasing crude oil costs. As per the ChemAnalyst assessment, Silica prices were assessed around USD 64.3/MT during February in the USA.
Silica prices have been rising in the Asian market for some time, owing to strong offtakes and insufficient supplies from regional market. Exporting countries such as China, on the other hand, experienced disruption in Q4 2021 as a result of a dual energy policy issue, which coincided with the rising threat of the Omicron version. However, the threat of Omicron turned out to be less severe than expected, therefore no such extreme effects were noticed. Furthermore, demand fundamentals for the commodity from the domestic construction sector have been rising due to seasonal offtakes, while the global market's overall pricing dynamics have been escalating due to the Russia-Ukraine conflict. Furthermore, the ongoing confrontation between Russia and Ukraine has pushed up the price of crude oil, putting inflationary pressure on global procurers. Silica price was assessed around USD 54.3/MT during February.
During the months of January and February, the price of Silica increased by almost 2-3%. The conflict between Russia and Ukraine was the prime factor of the problem. Germany's reliance on Russia for petroleum and other energy sources resulted in a negative economic curve. Following the escalation of the conflict between the two countries, natural gas costs skyrocketed, explaining the spike in Silica prices. Furthermore, the resurgence of the omicron virus in Germany resulted in the enforcement of a lockdown, which had an impact on the trade sector. The battle has also pushed up the price of crude oil, which has had an impact on the worldwide market. Silica price was hovering around USD 60.2/MT during February 2022.