For the Quarter Ending June 2023
North America
The price of White Oil saw a declining trend in the North American region throughout the second quarter of 2023. The business sentiments have been hampered by the uncertainty regarding the economic conditions and debt-ceiling talks. The market transactions were observed to be slow, and sufficient material availability was present in the region. The merchants continued to work through their existing stocks in the domestic market. The demand for the product did not rise due to the sufficient availability to meet the requirements of the downstream cosmetics and personal care industries. Demand conditions weakened notably, however. The fall in new orders was strong in general and the fastest for quite some time in May. Past quarter climbs in selling costs, close by adequate stocks at clients, purportedly drove the decline in new orders. Burdening all-out deals was a more extreme decrease in new product orders. The price of White oil hovered around USD 1762/MT on a CFR Texas basis at the end of the second quarter.
APAC
The cost of White oil remained weak in the Chinese market due to the poor performance from downstream cosmetics and personal care industries throughout the second quarter of 2023. Traders have a poor mentality, their prices have fallen, and the difficulty of arbitrage has increased. Recent NBS data showed that China’s manufacturing PMI has dropped and is below threshold points. These indicates that the stagnant economy tends to the production to fall, and new orders remain bleak in the Chinese market. Business confidence dropped in the region, and slow market transactions have been observed in this period. The downstream demand from the personal care and cosmetics industry was sluggish whereas, the supply was usual in the region. In the given time frame, no supply chain constraints were reported, and the offered quotes for White Oil Technical Grade CFR-Shenzhen settled at USD 1427/MT at the end of the second quarter. Further, sluggish global economic development, decreasing global trade and investment, geopolitical uncertainties, and declining external demand continue to influence China’s trade.
Europe
Throughout the second quarter of 2023, the price trend of White Oil remained in a downturn pattern across the European region due to the decline in raw material crude oil prices in the last two months of Q2. The White Oil had a sufficient supply in the Eurozone area to cater to the downstream requirements. Growth of service sector output, meanwhile slowed sharply as the recent resurgences in spending on services lost momentum. The slowdown signaled stagnation of new business in May and June. The new business activity across goods and services worsened in Q2, as new orders dropped, and demand conditions deteriorated in the Eurozone. Eurozone manufacturers cut their purchasing activity, as the firms showed a preference for existing stock levels in the market. A lack of new contracts remained the primary factor behind the reduced activity and continued to discourage the firms from buying new materials. Falling demand from downstream cosmetics and personal care sectors led to increasing discounting in manufacturing, resulting in the average input prices dropping in the factory.
For the Quarter Ending March 2023
North America
In the US domestic market, the prices of White Oil plummeted in the first two months of Q1 2023, and in the third month, the prices stabilized in the US domestic region. In January and February, the prices contracted amid inflationary pressure and an economic downturn. The demand from the downstream personal care and cosmetics industries remained lackluster, and the spot market transactions were average. As per the market participants, the drop in freight charges and shipment containers is attributed to the bearish market sentiment for White Oil in the domestic market of the USA. In March, the prices were stable amid steady crude oil imports and a balanced supply and demand outlook in the region. Thus, the market prices of White oil Cosmetic Grade CFR Texas settled at USD 2060 per tonne at the end of the first quarter.
APAC
In the first quarter of 2023, the market prices of White Oil showcased a mixed pricing trend in the Indian domestic market. In January, the prices dropped amid weak demand from the downstream personal care and cosmetics industries. Also, the decrease in freight charges, decline in container rates, and global inflation caused a weakening in shipping demand. In February, the prices gained upward momentum, and as the demand outlook improved and production costs rose in the region. The prices of White Oil turned southwards in March owing to weaker cost support from the upstream crude oil in the domestic market, whereas the demand and supply dynamics remained unchanged this month. Thus, the market prices of White Oil FOB JNPT settled at INR 75210 per ton at the end of Q1.
Europe
In Europe, the market prices of White Oil showcased mixed market sentiments in Q1 2023. The overall market prices of White Oil surged in January, backed by positive cost support from the upstream Crude oil and active inquiries from the downstream cosmetics and personal care industries in the region. In February, the prices of White Oil were stable as a balanced demand and supply outlook was observed in the region. Also, the domestic manufacturers maintained adequate inventories to cater to the downstream consumer demand. The prices dropped in the last month due to sluggish demand from the downstream personal care and cosmetics industries. Throughout this month, the production cost declined due to lower TTF natural gas prices in the European region.
White Oil prices have remained on the upper edge in the US market throughout the fourth quarter 0f 2022. Elevated inflationary pressures across the globe coupled with tight monetary policies have accelerated the pricing dynamics of White Oil in the US market. The cost support from upstream raw materials was limited, as reported by market participants. In November, the prices of natural gas escalated and pressured the production costs of White Oil in the domestic region. Furthermore, the procurement from the downstream personal care sector was average, and the competitive offers from other countries have weighed on the market fundamentals of White Oil. The ChemAnalyst database has shown that White Oil cosmetic grade CFR Texas was settled at USD 2359 per ton in Q4-end.
In the Indian domestic market, the prices of White Oil have retained their downward trajectory in the entire Q4. The prices fell amid abundant supplies and a slowdown in demand from the overseas market. The demand from the downstream personal care sector was not sufficient to cause a rise in the market value of White Oil. The market has operated at low levels, and the shipment has been lowered. On the upstream front, the cost support from upstream Crude Oil has also weakened and supported the decline in the price realizations of White Oil in the fourth quarter. In addition, the freight rates have also remained on the lower end. Consequently, White Oil WT 150 FOB JNPT prices were settled at USD 1038 per ton in December.
In the fourth quarter of 2022, the prices of White Oil have demonstrated mixed market sentiments. The high inflation, coupled with limited supplies of natural gas, has hampered the market growth of White Oil in the domestic region. The procurement of White Oil from the end-use industries was limited, prompting the traders to reduce their offers and increase the shipments amid the destocking season in December. The prices of upstream Crude Oil have remained in the negative territory throughout the fourth quarter and weakened the market sentiments. Furthermore, high natural gas prices have impacted production costs and culminated in lower operating rates. However, at the end of Q4, the inflationary pressures have been eased, and manufacturing activities been improved in the German market.
