For the Quarter Ending September 2023
North America
In the third quarter of this year, the Tertiary Butyl Alcohol market remained subdued, and the prices declined throughout the period. Over three months, the demand outlook remained moderate amid consumers’ reluctance for new purchases and were mainly focusing on long-term orders. The first month observed sufficient material availability in the domestic market. However, as per the government GDP data, the economy improved at an increased pace from July to September, despite higher interest rates, depleted pandemic savings, and high inflation. Further, the industrial manufacturing output rose to the highest level in months. Albeit, in September, the prices increased slightly as the demand conditions improved. Moreover, amid enhanced consumer spending, businesses across the region showcased positive development in the market. However, the procurement from the battery manufacturing firms was underwhelming due to lackluster demand whereas, the petrochemicals market did not show any signs of improvement. In this quarter, the impact of crude oil was also observed in the prices of TBA.
APAC
In the third quarter of 2023, the Tertiary Butyl Alcohol market in the Asia-Pacific region demonstrated mixed sentiments. In both July and August, the domestic market for Tertiary Butyl Alcohol in China experienced a decline in market sentiment due to weakened demand from downstream industries. Manufacturers operated at a slower pace due to factory gate deflation, leading to further erosion of profit margins. Product purchases were largely demand-driven, and domestic manufacturers maintained production levels. In August, the situation persisted with a PMI of 49.7, underscoring the ongoing challenges in the market. Come September, the prices rebounded in the domestic market amid increased production costs of the product and improvement in the demand outlook. Amid slight ease in the factory gate deflation, the businesses' performance improved in the region. China has considered increasing its budget deficit for 2023 as the government prepared to unleash a new round of stimulus to assist the economy in reaching the official growth target. As of September 2023, the prices of Tertiary Butyl Alcohol in China were assessed at USD 1050 per tonne.
Europe
In the third quarter of 2023, the Tertiary Butyl Alcohol market in the European region demonstrated mixed sentiments. In July, Tertiary Butyl Alcohol (TBA) prices in the German market remained stagnant. The subdued demand from the domestic paint industry, driven by economic uncertainties, played a key role in this price stability. Insufficient cost support from Isobutane, which experienced declining prices, combined with a modest uptick in crude oil costs, failed to significantly influence TBA prices, which stood at $78.47 per barrel. In August, TBA prices in the German market increased, reflecting a steady demand outlook with no substantial developments in new purchase orders. The following period saw a marginal 1.9% decrease in TBA prices in the German domestic market due to weak consumer demand, particularly from the solvent manufacturing industry, which suffered from subdued buying sentiments. On the supply side, production costs dipped due to feeble cost support from upstream Methanol. As of September 2023, the prices of Tertiary Butyl Alcohol in Germany were assessed at USD 1032 per tonne.
For the Quarter Ending June 2023
North America
Tertiary Butyl Alcohol (TBA) prices have remained on the lower end in the US market during the second quarter of 2023. The global economic headwinds such as mounting inflation, tighter monetary policies, and rising interest rates have weighed on the downstream sector including the construction industries. The manufacturer's inventories have raised as the higher borrowing cost and economic conditions have been tampering with the already constrained demand from the downstream construction industry in the domestic market. Although, the supply chain constraints have been eased, and logistics were restored. The core inflation has also trended above the US Federal Reserve targeted level, inching downward slowly, pressuring trade activities. Although, during the H2 of Q2, the construction sector has gained pace in the US market. As per the sources, US construction spending rose 0.9% in May after 0.4% in April and didn’t lead to an increase in the price realization of TBA in the domestic market. On the upstream front, Isobutylene prices have inched lower which negatively impacted the production cost of TBA in the domestic market.
Asia- Pacific
Tertiary Butyl Alcohol or TBA prices have shown mixed sentiments in the Chinese domestic market during the second quarter of 2023. During the initial of Q2, TBA prices have inched higher in the domestic market due to high-cost pressure from the feedstock Isobutylene. The inquiries from the downstream solvent in the paints and coating industries have remained moderate in the domestic market. The downstream procurement was mainly based on immediate requirements. Although, during the mid and end of Q2, TBA prices have gained a downward trend due to weak feedstock prices and limited demand. The demand from the downstream solvent in the paint and coating industry has plummeted and a plunge has been observed in the manufacturer’s quotations for input raw materials, including TBA. As per the sources, new house sales were down in June amid the property crisis, thus impacting the market sentiments of TBA. Furthermore, the highly anticipated economic revival of China following the removal of Covid-19 restrictions is not materializing as expected, resulting in a repeated deterioration of the Chinese economy. In addition, the subdued demand from the Western market has tampered with the market momentum, inflicting the exports from China to decline by 7.5% in May on a year-on-year basis. Furthermore, the oversupplies of feedstock Isobutylene have limited the positive development of TBA in the domestic market, therefore, the prices operated at low levels in the domestic market.
Europe
Overall, Tertiary Butyl Alcohol prices have inched lower in the German market throughout the second quarter of 2023 amid weak feedstock prices and tepid downstream demand. The mounting inflationary pressure and rising interest rates by the European central bank to combat inflation have impacted the consumer’s pocket. In addition, the German inflation rate increased in June to 6.4% year-on-year, from 6.1% YoY in May which slowed down the economic growth in Europe's largest economy, Germany. In the meantime, demand for TBA from the downstream solvent in the paint and coating industry has remained subdued amid sluggish buying sentiments among the end-users. The market transactions were relatively flat as purchasing enthusiasm of terminal firm to enter the market were not high. As per the sources, Germany's construction purchasing managers index declined to 41.4 in June from 43.9 in May. Furthermore, the oversupplies of feedstock Isobutylene have limited the positive development of TBA in the domestic market. In addition, the availability of finished stock of TBA was also sufficient amid a decline in new orders as a result manufacturing firms reduced their operating rates as manufacturers were cautious to build up excessive inventories in the domestic market, thus weighing down the prices of TBA in the domestic market.
Tertiary Butyl Alcohol (TBA) prices fluctuated in the USA market during the first quarter of 2023. In the first two months of 2023, TBA prices increased due to improved buying sentiments in the domestic market. Demand from the downstream solvent industry has been boosted, which further promoted the high prices of TBA in the domestic market. However, towards the end of Q1, the financial sector worries amidst the failure of Signature and Silicon Valley banks have constrained the downstream demand, thus weakening the market growth of TBA in the domestic market. In addition, LyondellBasell Industries performs Final Commissioning for a new 2.2 billion Lbs/yr Tertiary Butyl Alcohol (TBA) unit in Channelview, TX. The units are expected to be operational in late March or early April, which is anticipated to increase the TBA availability in the USA market.
Tertiary Butyl Alcohol has shown a see-saw trend in China during the first quarter of 2023. During January, TBA prices increased after the New Year Holidays as the market participants restocked the material available in the domestic market. Demand from the downstream gasoline and solvent industries has increased marginally from the domestic and overseas markets. In addition, China's Purchasing Manager's index increased from 47.0 to 50.1 in January, signifying an increment in both industrial and manufacturing activity. However, during February, TBA prices decreased due to a slowdown in the downstream demand and ample supplies in the domestic market. As per the market sources, China's export rate for January- February month declined by around 6.8%, highlighting the continuous weakness in global demand. Although, due to increased demand from the domestic and international markets, TBA prices have rebounded towards the end of the Q1 of 2023.
Tertiary Butyl Alcohol (TBA) has shown mixed sentiments in the European market during the first quarter of 2023. During the initial and mid-Q1, TBA prices dropped due to dull buying sentiments and ample supplies in the region. Feedstock Isobutylene fluctuated throughout the quarter, but it had limited bearing over the prices of TBA. In addition, due to high-interest rates and inflation, the demand from the solvent industry has remained sluggish. There were no new orders from end-use industries, so the product ended up in stock. Moreover, the market perceived a wait-and-see attitude. However, during the final of Q1, TBA prices increased significantly as market participants restocked the material in the regional market. On the other side, demand for TBA from the solvent and gasoline has improved at a slower pace from the domestic and overseas markets.
