For the Quarter Ending March 2023
North America
Tall oil Rosin prices have witnessed a mixed trend in the USA market during the first quarter of 2023. During January, Tall Oil Rosin prices declined due to weak spot demand and firm material availability in the domestic market. In addition, imports from Brazil (exporter) have remained firm, thus leading to better material availability on the USA shores. The demand for Tall Oil Rosin from the downstream paints and coating, and adhesives industries has remained gloomy while the sufficient supplies to cater to the overall domestic demand. However, during February and March, Tall oil Rosin prices increased due to improved buying sentiments in the domestic market. The procurement from the downstream paper and ink industries has risen but at a slower pace. At the same time, imports have dropped from the exporting country as the production was hampered in Brazil amid carnival holidays, thus limiting the supplies in the USA market, which forces the traders to raise their price quotation.
Asia- Pacific
Tall oil Rosin prices have showcased an oscillating trend in China market during the first quarter of 2023. In the first two-month of 2023, Tall oil Rosin prices have dropped due to dull buying sentiments and ample supplies in the market. Operating rates in China have remained moderate due to weak consumption from downstream industries. In addition, cost pressure from the feedstock Pine trees has remained stable throughout the quarter. On the other side, demand from downstream adhesives, paints, and coating, rubber industries has slowed down both domestically and overseas, and market participants have reported limited new orders from end-users. However, the adequate inventories of the product have led manufacturers to revise their negative price quotations in the domestic market. However, due to increased procurement from the downstream paper, the ink industry has resulted in the high prices of Tall Oil Rosin towards the end of Q1.
Europe
The prices of Tall Oil Rosin have decreased in the German market during the first quarter of 2023. This can be attributed to sluggish demand from downstream industries, adhesives, paints, and coating industries amid ongoing holidays in the European markets. Additionally, imports from Italy and other exporting countries have remained steady. As a result, there is ample material availability in the domestic market, owing to firm imports and stable production rates. Moreover, the already bearish sentiment in the regional market has been further weakened by the recent US banking crisis and the latest Credit Suisse debacle. In contrast, the German market has witnessed a decline in PMI for March 2023, with the Manufacturing PMI dropping to 44.7, signifying a monthly dip of 3.6%, and remaining in contraction.
For the Quarter Ending December 2022
North America
Tall oil Rosin prices decreased in the US market throughout the fourth quarter of 2022 on the back of adequate material availability and weak downstream demand. Furthermore, the dramatic decline in freight charges resulted in cheap imported materials. In addition, the performance of the adhesives and automotive industry remained comparatively weak during this quarter, which constrained the consumption of Tall Rosin oil. Meanwhile, the supply chain has operated normally, which leads to better material availability in the domestic market. For the first time in 30 months, the USA witnessed a contraction in industrial and manufacturing activity as consumer sentiments softened while Federal Reserve continued tightening the monetary policy to control inflation rates.
Asia-pacific
Tall Oil Rosin prices dropped in the Asian market throughout the fourth quarter of 2022. In China, Tall Oil Rosin decreased owing to the subdued demand from the downstream automotive and other competitive industries amid the sluggish consumer sentiment in the domestic market. Furthermore, under the influence of persistent lockdown implementation and the zero covid policy, manufacturers have started facing a labor shortage coupled with supply chain disruption, which majorly pertains to logistical constraints. In addition, manufacturing activity declined in Q4 as Covid-19 outbreaks continued to weigh on both output and demand. According to the data, purchasing manufacturing index dropped below 50 (i.e., 49.4), signifying a contraction in manufacturing and industrial activity. Similarly, in the Indian market, both imported and domestic products have been priced lower. Demand from the downstream industries has remained bearish, resulting in the price drop of tall oil rosin.
Europe
Throughout the fourth quarter of 2022, prices of Tall Oil Roisin have witnessed a downward trend in the European market. The primary factor for the price decline was the steady inflows of cheap imported materials from the exporting countries. Demand from the downstream automotive, adhesives along with other competitive industries, has remained bearish amid sluggish buying sentiment in the region. Meanwhile, the threat of recession has eased in Q4. As per the data, inflation in Europe dropped from 10.1% to 9.2% in December 2022. In terms of domestic production, operating rates remained under check due to weak demand, while supply chain dynamics have improved in the European continent with no major port congestions. Hence, accelerating the availability of imports and inter-European transportation, respectively.
For the Quarter Ending September 2022
North America
Tall Oil Rosin prices have continued to decrease in the North American region throughout the third quarter of 2022, backed by weak demand dynamics and a continuous drop in feedstock prices. Demand from the downstream adhesives, paint, and coating industries has dropped amid the high inflation rate. Meanwhile USA, supply dynamics remained under pressure as the major exporting port of Houston witnessed port congestion, resulting in the limited availability of the material in the domestic and overseas markets. However, low offtakes from the European and other importing countries resulted in little influence on the overall price dynamic of Tall Oil Rosin. As a result, the price of Tall Oil Rosin plunged by 4-5% during September 2022.
Asia- Pacific
Tall Oil Rosin prices have witnessed a downward trajectory in the Chinese market during the third quarter of 2022. Sufficient inventory levels and a drop in feedstock prices resulted in a sharp bearish trend. Demand from the downstream paint and coating adhesives industries has been lackluster. At the same time, demand from the overseas market has also dropped amid a slowdown in global economic activity. Further, China's battle with Covid in Q3 2022 as the market activities remained under constant threat of covid related disruptions. At the same time, port activities were also halted due to the rise in covid cases. As a result, Tall Oil Rosin FOB Huangpu prices dropped by approximately 3-4% during September. On the other side, in the Indian market, Tall oil Rosin prices showed mixed trends due to fluctuation in the demand dynamics. During July, prices dropped by 1.7% due to weak demand from the downstream industries amid sufficient inventory levels. However, prices have increased due to limited imports from exporting countries like China, resulting in restricted material availability. Demand from the downstream paint and coating, and adhesives industry has improved. Hence, as a result, prices of Tall Oil Rosin Ex- Kandla were assessed at USD 1793/MT during September 2022.
Europe
During the third quarter of 2022, Tall oil Rosin prices have gained downward momentum in the European market owing to the weak feedstock prices. A steady flow of cheap imports from Asia and the USA has contributed to the price drop in the regional market. Demand from the downstream adhesives, paint, and coating industries has declined due to sluggish consumer sentiments in the European region. Although, Supply dynamics remained under pressure owing to port congestions and labour strikes. Netherlands, Belgium, and Germany witnessed major port congestions, while the UK observed weeks of labour strikes which limited the availability of the material in the domestic market. Although, weak demand ensured the limited impact of the reduced supply on the prices. Hence, as a result, prices of Tall Oil Rosin dropped by 3-4% in Germany during September 2022.
