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| The phenol and acetone markets are weak in the second half of the year |
| Market insiders indicate that global prices of phenol and acetone will remain low in the second half of 2024. From an upstream perspective, there is sufficient supply of products from Asia and Europe, while the supply of acetone and methyl methacrylate in the US market is tight, resulting in an overall supply environment that tends towards balance. However, from a downstream perspective, the weak purchasing interest in the entire downstream industry chain has dragged down the entire acetone and phenol markets into a period of weakness. The demand for phenol in the United States will remain stable Participants in the North American phenol market expect that demand for phenol in North America will remain stable in the second half of 2024, due to macroeconomic inflationary pressures on housing and construction, as well as rising costs of raw material benzene leading to weak demand. The demand for phenol may be affected by downstream imported products. Bisphenol A is a key raw material for the production of epoxy resins, accounting for over one-third of the total demand for phenol in North America. The recent anti-dumping investigation into Asian epoxy resins may trigger trade changes, thereby affecting prices. People are also concerned about the impact of the upcoming hurricane season. The acetone market is expected to have stable prices and will not experience significant fluctuations. The low operating rate and limited spot supply of phenol will continue to put pressure on acetone production. According to sources, although the supply of acetone products is expected to be supported by these imports, prices are not expected to decrease due to the continued high shipping costs between the United States and Asia affecting arbitrage. Market sources indicate that due to insufficient imports of phenol, MMA supply in the United States should remain tight, and suppliers also estimate that demand recovery may not be sufficient. With the production of the 250000 tons/year acetone plant for ethylene raw materials by ROHM Company from the end of 2024 to the beginning of 2025, the MMA production capacity in the United States may increase. European market shows no significant recovery In Europe, the acetone and phenol markets will continue to maintain low demand as market participants have not seen clear signs of recovery. Yazmine Khan, Director of Phenol Products at S&P Global Commodity Insights, said, "Despite extensive maintenance of phenol production capacity in Europe, supply can still meet demand; while the availability of acetone is still limited." Khan added, "Ineos Antwerp production facility will continue to shut down and is not expected to restart. This will enable other European producers that are currently operating to operate at higher load rates. This means that although the theoretical operating rate is low, Europe’s effective operating rate looks much healthier." Sources said that with the arbitrage window open, the United States is expected to remain Europe’s main export channel. The European MMA market should continue to heavily rely on imports. If Chinese prices fall, the arbitrage window may reopen and more goods will flow to Europe. As for polycarbonate, it is expected that demand will remain stable or slow down at least until August, and there will be more uncertainty by the end of the year. A source said that demand will not have a significant impact on the European automotive industry and may slightly decrease compared to last year. The construction industry is stable at a relatively low level and will not see any improvement in the coming months, "said the source. Asian exports may increase Market sources indicate that with the increase in production capacity in Asia, especially in Northeast Asia, Asia will become an important export region for phenol and acetone. The Indian phenol market may maintain a good supply situation, but prices are highly susceptible to the impact of upstream raw material benzene costs. The demand for phenol from downstream laminates and phenolic resins is expected to remain stable and then weaken, and will also be slightly affected by the weak demand in the agricultural chemicals industry. From a supply perspective, sufficient supply in both domestic and international markets in India will keep inventory healthy and put pressure on prices. Meanwhile, due to global supply constraints, the overall demand for acetone in India is expected to remain strong, thereby supporting prices. A trader stated that "the demand for acetone in the paint and coating industry will remain stable, and the demand in the pharmaceutical industry should remain stable." By December, the production of 30000 tons/year of downstream methyl isobutyl ketone capacity will help increase acetone demand. But in Northeast Asia, the situation is different. With the increase of multiple new production capacities, phenol and acetone producers in Northeast Asia are striving to rebalance the market. Exporters are increasingly seeking markets outside of Asia, and the high price of benzene this year has affected producers’ profits. However, the downstream market situation in Asia is still good. In terms of bisphenol A, with the completion and resumption of production and inspection in Thailand and Singapore, the demand for bisphenol A in the Asian market has increased. Due to some new production capacity being put into operation, it is expected that the export volume of polycarbonate will also increase. Foreign attention to Chinese polycarbonate is also on the rise, reflecting possible changes in global demand. According to sources, the high pricing of methyl methacrylate (MMA) in 2024 has affected demand, causing some Indian and Southeast Asian buyers to reduce their purchases. According to Platts Energy Information data, the price of MMA in China reached $2100/ton in May, the highest level since March 11, 2021, while in August 2023, the price of MMA in China hovered around $1500/ton. With the resumption of MMA production in Northeast Asia, the price of MMA in China will decrease, leading to a recovery in MMA trade in Asia. |
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| Release time: 2024-08-15 Click: 85 |
Company Name: Tianjin Shengfan Technology Corporation
Mobile Phone: 86-16600237486
Email: chris@dyessf.com
Website: www.dyessf.com
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