AluminoSilicate Prices Decline in US and Africa in October 2023 Amidst Low Demand

In South Africa, the prices of AluminoSilicate witnessed a significant decline in October 2023, primarily because there was no growth in new orders from the downstream construction industry. Amid deteriorating conditions in both demand and supply, South African companies significantly reduced their purchasing activity in October. They also made evident efforts to cut costs, which had a negative impact on spending. In October 2023, both purchases and inventories of inputs saw the most substantial decline. Even though new orders for AluminoSilicate were declining, employment levels increased, leading companies to make some progress in addressing their backlogs of work. However, this backlog reduction was not as extensive as observed in September.

At the beginning of the fourth quarter of 2023, the supply-side situation took a downturn, with companies frequently reporting delays at domestic ports and shortages and slowdowns in inputs due to escalating fuel prices. On the whole, delivery times extend to the greatest extent in seven months. On a positive note, decreasing demand for inputs seemed to mitigate the pace of input cost inflation.

On the other hand, the US AluminoSilicate prices also followed the same pattern throughout October 2023. The product's demand improved less, with domestic merchants managing existing stock levels. Additionally, there was a slight reduction in the non-manufacturing Purchasing Managers' Index (PMI) compared to September, indicating a minor decline in the construction industry, leading to reduced AluminoSilicate consumption. Moreover, in October, exports declined as merchants received reduced orders from the overseas market. This drop in orders was due to the impact of reduced water levels in the Panama Canal, which affected transaction activities during the month. Finally, business confidence reached its lowest point in 2023 due to diminishing backlogs and relatively subdued demand conditions.

According to ChemAnalyst, the cost of AluminoSilicate was settled at USD 1350/MT on a FOB Texas basis with a monthly depreciation of 0.7% at the beginning of the fourth quarter of 2023. This reflects the pricing trend for AluminoSilicate in the market.

Anticipations for the fourth quarter of 2023 suggest a slight downturn in AluminoSilicate prices, largely influenced by the ongoing demand dynamics in downstream industries. As the year's end approaches, there's a likelihood that manufacturers will engage in destocking the material (AluminoSilicate), potentially offering it at more affordable prices. This shift could be a strategic response to market conditions, aiming to find a balance between supply and demand while addressing economic considerations.