Aspirin Prices Diverge: Asian Markets Dip While Western Markets Surge

The prices of Aspirin exhibited contrasting trends in Asian and Western markets during June, influenced by a variety of factors. In Asia, prices declined primarily due to erratic demand patterns and a scarcity of new inquiries, negatively impacting profit margins for local manufacturers and suppliers in the global trade. Conversely, in the West, prices increased due to delays in shipments from China, a key exporter of active pharmaceutical ingredients (APIs) including Aspirin.

The Chinese Aspirin market is experiencing a downward price trend due to a combination of factors. Despite some manufacturers scaling back production, the market remains oversaturated, with supply outpacing demand. This abundance of Aspirin, coupled with numerous existing and pending long-term contracts, ensures a steady influx of the product into the market. Another critical factor is the sluggish domestic demand, which further weakens market sentiment as there is no significant pull from the market to absorb the existing supply. In this situation, manufacturers are struggling to find buyers for their products, leading to excess inventory and pressure to lower Aspirin prices to stimulate sales.

The ongoing conflict in the Red Sea is significantly impacting global maritime traffic, given the region's vital role in facilitating the movement of goods between Asia, Europe, and other parts of the world. Attacks in this area have led to major disruptions and heightened risks for vessels navigating these waters. As a result, shipping costs have surged, with major shipping companies increasing their prices across multiple routes. This rise in shipping costs is being passed on to consumers, contributing to the escalating prices of Aspirin.

Demand continues to be strong, with rates rising steadily in both the first and second halves of June. This increase in demand is fuelled not just by consumer requirements but also by companies bolstering their stockpiles to secure space amidst extended lead times, potentially affecting inventory levels in Q4 and contributing to the continued rise in Aspirin prices.

Meanwhile, ocean imports from Asia to West suggest a phase of replenishment coinciding with the peak season, driving rates to their highest levels recorded in 2024. Container freight expenses from Asia to the U.S. and Europe have tripled since early 2024. Increased consumer spending compared to last year and proactive inventory management by retailers are also contributing to the upward trend in Aspirin prices.

According to analysis by ChemAnalyst, Aspirin prices are projected to continue increasing due to sustained demand from the healthcare and pharmaceutical sectors. Market suppliers and distributors, recognizing this trend, may capitalize on the situation by quoting higher prices for Aspirin to optimize their profits.