For the Quarter Ending March 2025
North America
In Q1 2025, Tall Oil prices in the USA experienced a mixed trend. In January, prices saw a moderate rise driven by a resurgence in U.S. manufacturing activity, which boosted demand for industrial products like adhesives and biofuels. Higher energy costs also contributed to the increase, while concerns about a potential strike by the International Longshoremen's Association (ILA) led to stockpiling, further pushing prices up. However, the strike was called off, easing supply disruption fears.
In February, prices continued to rise due to strong export demand and tightening domestic supply, with buyers accelerating orders in anticipation of retaliatory tariffs. This was supported by expanding manufacturing activity and the ongoing U.S.-EU trade tensions.
By March, Tall Oil prices declined as both domestic and international demand weakened. Foreign buyers reduced orders after stockpiling in February, and U.S. manufacturing contracted amid concerns over tariffs, leading to a decrease in consumption. This combination of factors contributed to a downward pressure on prices, marking a shift in market sentiment by the quarter's end.
Asia Pacific
In Q1 2025, Tall Oil prices in China exhibited fluctuations influenced by supply constraints, demand dynamics, and trade policies. In January, prices increased modestly due to supply limitations and heightened demand from sectors like nutraceuticals and healthcare. Anticipating potential U.S. tariffs on Chinese goods, importers stockpiled Tall Oil, creating upward price pressure. February saw further price increases, driven by logistical disruptions from the Lunar New Year holidays, which caused delays in shipments and depleting inventories. The imposition of retaliatory tariffs on U.S. goods by China further raised import costs, tightening supply. Despite port congestion easing in late February, demand from adhesives, paints, and biofuels kept prices elevated. In March, prices declined as supply conditions improved, bolstered by a stronger yuan that reduced import costs. However, weaker demand, partly due to cautious importer behavior amid anticipated tariff adjustments, contributed to a subdued market. Overall, Q1 2025 was marked by volatility in Tall Oil prices, influenced by global trade tensions, cautious import behavior, and shifting demand dynamics.
Europe
Tall Oil prices in Finland experienced marked volatility throughout Q1 2025. In January, prices declined sharply due to weak domestic consumption, subdued industrial activity, and inflationary pressures across the Eurozone. The strengthening Euro further diminished international competitiveness, prompting market participants to lower price quotes. In February, prices rebounded significantly as the industrial strike in Finland’s chemical sector disrupted production, notably halting operations at UPM’s Kymi pulp mill, tightening Tall Oil supply. Simultaneously, labor unrest at major European ports hampered exports, raising logistics costs and supporting price increases. Demand remained stable, underpinned by consistent procurement from adhesives, coatings, and biofuels industries. However, in March, prices fell again following the restart of pulp production at UPM’s Kymi facility, which improved supply availability. Despite this recovery, Tall Oil exports remained constrained due to lingering port congestion across Northern and Southern Europe. The resulting procurement delays dampened buying momentum, limiting upward price movement. Overall, Q1 2025 for Finland’s Tall Oil market was characterized by demand stability, supply-side disruptions, and fluctuating logistics, resulting in a price pattern marked by a sharp January decline, a February surge, and a March correction.
For the Quarter Ending December 2024
North America
In Q4 2024, Tall oil prices in the U.S. experienced notable fluctuations, influenced by a combination of economic factors and market dynamics. October saw a decline in prices, largely due to economic uncertainty, weakening demand, and concerns about inflation. These factors dampened consumer sentiment and business confidence, prompting a cautious market environment that resulted in reduced demand and price cuts to encourage sales.
November brought a rebound in prices, fueled by increased domestic demand as businesses ramped up production in preparation for the holiday season. Optimism, bolstered by improved consumer confidence and post-election stability, combined with a recovering global market and stable freight conditions, helped lift prices. However, inflationary pressures and rising production costs in the paper and pulp industry continued to put upward pressure on prices.
By December, prices fell once again, driven by a decline in consumer confidence and lower demand from key end-user sectors. A proactive inventory buildup in anticipation of potential labor strikes helped maintain high supply levels, contributing to the price drop. In sum, Q4 2024 saw a volatile Tall oil market, marked by fluctuating prices driven by shifting demand, cautious consumer behavior, and strategic inventory management.
Asia Pacific
In Q4 2024, Tall oil prices in China exhibited significant volatility, shaped by a variety of market forces. October experienced a price decline due to weak domestic demand, an oversupply of international stock, and heightened competition from foreign suppliers. Geopolitical uncertainties made Chinese buyers more cautious, leading to a reduction in imports and pushing prices lower. November saw a slight recovery, as demand from key industries such as adhesives, coatings, and oleochemicals remained steady. Additionally, proactive inventory buildup ahead of the holiday season helped stabilize the market, supporting a brief price uptick. However, December saw prices decline once more. The downturn was driven by disinflationary pressures, reduced demand in crucial sectors like paper and textiles, and an oversupply of stock caused by increased imports and preemptive stockpiling. The combination of these factors resulted in another round of price erosion. In summary, Q4 2024 in the Tall oil market in China was characterized by fluctuating prices, with periods of decline followed by brief rebounds. These trends were largely influenced by changes in demand, geopolitical factors, and seasonal supply chain adjustments.
Europe
In Q4 2024, the Tall oil market in Finland experienced a mix of price fluctuations driven by evolving demand and supply dynamics. In October, prices saw a slight increase, influenced by improved business morale, rising consumer confidence, and the European Central Bank’s interest rate cuts, which boosted spending and investment. Suppliers also built up inventories ahead of the holiday season, and global shipping disruptions added supply pressure. November saw a more pronounced surge in prices, fueled by higher demand from sectors like chemicals, paints, and coatings, coupled with stockpiling in anticipation of a seasonal slowdown. The depreciation of the euro further heightened price pressures as exports became more attractive. However, in December, prices declined due to reduced demand from key sectors, buyer hesitancy amid inflation concerns, and sufficient inventory levels. Additionally, harsh winter weather and logistics disruptions slowed consumer spending, leading to a cautious market approach and a subsequent drop in Tall oil prices as suppliers focused on clearing existing stock.
For the Quarter Ending September 2024
North America
In Q3 2024, the Tall Oil market in North America experienced a notable depreciation in prices, with the USA particularly feeling the impact of significant factors. A combination of subdued demand from end-user industries, a slowdown in manufacturing activity, and an overall deflationary environment contributed to the downward trend in Tall Oil prices.
Improved weather conditions, easing supply chain disruptions, and sufficient supply levels further added to the pricing pressure. The quarter saw disruptions in plant operations [names of plants/shutdowns], which also influenced market dynamics.
The USA, with the most substantial price changes, recorded a -12% decrease from the previous quarter and a -7% difference between the first and second halves of the quarter. This negative trend aligns with the overall decreasing sentiment in the North American Tall Oil market. The quarter concluded with Crude Tall Oil priced at USD 640/MT FOB Houston in the USA, reflecting the challenging pricing environment characterized by a bearish outlook and subdued market conditions.
APAC
The Quarter 3 of 2024 for Tall Oil in the Asia Pacific region witnessed a significant decline in prices, primarily influenced by weakening demand and adverse weather conditions. The market experienced a downturn due to sluggish consumer sentiment and falling prices, reflecting a broader economic slowdown. Disruptions from heatwaves and heavy rainfall further reduced industrial operations, contributing to the overall decrease in Tall Oil prices. China, in particular, saw the most significant price changes, with the depreciation of the Chinese yuan against the USD making imports cheaper and reinforcing the downward trend in prices. Throughout the quarter, the market trended negatively, with a notable -3% decrease from the previous quarter. Additionally, a -6% price difference between the first and second half of the quarter highlighted the continuous downward trajectory. Plant disruptions along with distinct operational output further added to supply constraints. The quarter culminated with Tall Oil priced at USD 2900/MT CFR Shanghai, signaling a challenging pricing environment in the region.
Europe
The third quarter of 2024 witnessed a notable surge in Tall Oil prices across Europe, with Finland emerging as the epicenter of price volatility. This upward trend was driven by a complex interplay of market forces. On the demand side, both local and international buyers showed strong interest, buoyed by increased consumer spending power as inflationary pressures eased. The upcoming holiday season prompted retailers to bolster their inventories, maintaining steady demand levels throughout the quarter.
Supply-side constraints emerged from a slowdown in manufacturing activities, creating a market imbalance that pushed prices higher. The quarter exhibited dynamic pricing patterns, with a 5% increase observed between its first and second halves. Despite operational challenges, Tall Oil prices at FOB Helsinki reached USD 2630/MT by quarter's end. While this represented a 4% decrease from the previous quarter, the overall trajectory remained positive, demonstrating the market's underlying strength.
This price movement pattern particularly highlighted Finland's crucial role in the European Tall Oil market, underlining its resilience amid changing market conditions.
For the Quarter Ending June 2024
North America
In Q2 2024, the Tall Oil market in North America exhibited a pronounced upward pricing trend, with a modest drop witnessed in the middle of the quarter influenced by several factors. The quarter was marked by a significant rise in demand, exacerbated by consumers' willingness to spend, as evidenced by robust retail sales.
This increased consumer spending contributed to the rise in demand for tall oil. Additionally, geopolitical tensions in the Middle East escalated, with Iran attacking Israel, resulting in a substantial increase in oil prices across the USA. Consequently, businesses faced higher operational and manufacturing costs, which were inevitably passed on to consumers in the form of higher prices. Furthermore, the collapse of a crucial infrastructure link, the Key Bridge in Baltimore, disrupted shipping operations, forcing container ships to reroute to alternative ports. Focusing on the USA, which experienced the most pronounced price changes, the market trends revealed a consistent bullish sentiment. The Manufacturing PMI indicated a continued contraction in the manufacturing sector, reinforcing the negative market outlook.
While on the supply side, the inventories of tall oil were low due to several factors. The demand for tall oil witnessed an uptick from both domestic and overseas markets, putting pressure on the existing supply. These logistical challenges significantly hindered the ability of suppliers and distributors to maintain adequate supply levels of tall oil, thereby exacerbating the shortage. However, the market witnessed a steady decline in the middle of the quarter, as international buyers exercised caution in placing new orders amidst uncertain shipping conditions, suppliers redirected their product towards the domestic market to alleviate inventory pressures. This influx of tall oil into the domestic market contributed significantly to the overall increase in supply levels. This trend yet again reversed as June commenced, resulting in an overall supply-demand balanced situation.
APAC
In Q2 2024, the Tall Oil market in the APAC region has experienced a notable decline in prices, influenced by a confluence of factors predominantly extending a bearish sentiment. The overall market dynamics have been significantly impacted by a subdued demand environment, compounded by high inventory levels, with modest rise witnessed in the middle and the last month of the quarter. Market participants have been grappling with substantial stockpiles, leading to aggressive price reductions in a bid to clear excess supply. Moreover, the easing of global crude oil prices has precipitated a reduction in operational costs, which in turn has been passed on to consumers in the form of lower Tall Oil prices. The decline in ocean freight rates has further contributed to the downward pressure on prices, making imports cheaper and intensifying competition among suppliers.
Focusing exclusively on China, the country has witnessed the most pronounced price changes in the region. Despite signs of economic recovery, persistent concerns over inadequate domestic demand have overshadowed the market, exacerbating the oversupply situation. Seasonality has not provided the usual upward push in demand, leading to a continued downward trend in Tall Oil prices. The price comparison between the first and second half of the quarter reveals a significant decline of 3%, underscoring the consistent negative sentiment prevailing in the market. The latest quarter-ending price stands at USD 3055/MT, reflecting a stable yet negative pricing environment as market participants continue to navigate the complexities of high supply and low demand. No notable plant shutdowns or disruptions were reported during the quarter.
Europe
In Q2 2024, the Tall Oil market in Europe experienced a notable decline in prices, influenced by multiple significant factors that created a challenging pricing environment. Central to this downturn was the pervasive sense of dissatisfaction within the industry due to subdued demand across various downstream sectors. Persistent inflationary pressures and high interest rates significantly restrained consumer expenditure, resulting in a cautious "wait and see" approach among businesses. Additionally, the appreciation of the Euro against the USD increased the cost of European exports, further dampening overseas demand. Companies faced high supply levels amid decreased demand, exacerbating the price drop. Focusing on Finland, which saw the most significant price changes, the overall market trends echoed this negative sentiment, characterized by a high supply surplus and low demand. Seasonal factors did little to alleviate the glut, as consumer spending remained constrained. The correlation in price changes reflected an overall bearish trend, with a -11% decrease from the previous quarter in 2024. A comparison between the first and second half of the quarter revealed a sharper decline of -10%, underscoring the persistent downward pressure on prices. There were no reported disruptions or plant shutdowns during the quarter, suggesting that the price changes were predominantly demand-driven. The quarter concluded with Tall Oil prices at USD 2500/MT in Finland, encapsulating a consistent and significant declining pricing environment.
