The stable offers from the downstream industries, such as agrochemicals and steel production, resulted in the bearish Hydrochloric Acid market throughout December 2022. The high inflationary input costs pressure and labor shortages have constrained downstream production activities in the APAC region.

In China, the upstream feedstock Chlorine prices consolidating at a low level and decreasing downstream demand in December 2022 was considered the primary factor for the downward price trajectory of Hydrochloric Acid. The downstream production activities were hampered due to labor shortages and high inflation in the Chinese market. The drop in the downstream steel demand due to the property sector crunch and uncertain COVID outbreaks across the country in December impacted the Hydrochloric Acid prices. As a result of an oversupplied market, domestic sellers made offtakes at lowered margins by dropping the costs of the commodity in the market. Moreover, the downstream steel industry production will likely remain low in 2023 amid the country's weakening economic growth and mild output cuts.

Meanwhile, the Hydrochloric Acid prices dropped in the Indian market in December 2022, bolstered by the muted downstream Steel producing industry demand. Indian downstream steel industries faced uneven market sentiments due to elevated inflation, rising upstream energy prices, and interest rates lowering the Hydrochloric Acid prices in the domestic market. Meanwhile, the high supplies continued to hit the Hydrochloric Acid demand at the termination of December 2022. Therefore prices dipped by 4.1% from the November values and hovered at INR 1390/MT Contract Ex-Vapi (India) for the industrial grade (33% Purity) in December 2022.

According to ChemAnalyst anticipation, "Prices of Hydrochloric Acid are likely to decrease due to expected lower demand from the end-user steel and cleaning industry in the Asian market with a slump in the downstream production. At the same time, the Hydrochloric Acid price trend is likely to be influenced by the high inflation and economic slowdown in the Indian market. Moreover, supply constraints will likely affect the price momentum of Hydrochloric Acid in FY23.