Cyclohexane Market in Europe Faces Weak Demand and Price Declines Ahead of Year-End

In the first half of November 2024, the European Cyclohexane market faced a bearish outlook, driven by a combination of lower production costs and weak demand from key downstream sectors, including nylon, paints, and coatings. As the financial year draws to a close, Cyclohexane suppliers across Europe are focusing on managing existing inventories, with negotiable prices becoming more common as they seek to clear stock.

The demand for Cyclohexane from the construction industry remained weak, as the ongoing downturn in Germany’s construction sector continued to impact prices. This slowdown in construction activity has extended into the last quarter of 2024, contributing to unfavorable demand conditions. Additionally, disruptions at European ports have further hampered the distribution of Cyclohexane, causing delays in its circulation across inland Europe.

In the textile sector, despite the approach of major retail events like Black Friday and Christmas, demand for Cyclohexane remains subdued. Retailers and industry experts expect a muted market response, with minimal growth in orders compared to the same period last year. This further indicates weak demand for Cyclohexane, especially in industries reliant on the chemical for production.

The construction market also continues to struggle, with significant declines in building permits for new homes in Germany. This has raised concerns about the future of the housing market and further dampened demand for cyclohexane. Particularly, approvals for single-family homes have dropped sharply, while multi-family housing, which plays a key role in addressing housing shortages, has also seen reduced activity, all of which signals a continuation of unfavorable conditions for Cyclohexane.

Export conditions have also been less than favorable, as ports in Northern Europe continue to deal with backlogs. Hamburg's ongoing port modernization program has led to controls on export containers, while winter weather issues in Rotterdam, including heavy fog, have contributed to delays in vessel movements. Similarly, maintenance work at the port of Antwerp is expected to cause further congestion, affecting the timely shipment of Cyclohexane and resulting in higher inventory levels at ports.

As of mid-November, Cyclohexane prices have declined in response to lower production costs, partly due to a drop in feedstock prices. This has added to the bearish market sentiment, with Cyclohexane suppliers focusing on clearing inventories ahead of the year-end. With the market remaining subdued and limited order volumes expected, suppliers are likely to continue offering negotiable prices in a bid to move stock.

Looking ahead, the outlook for Cyclohexane remains pessimistic, with continued challenges in both domestic demand and export logistics. As suppliers work to clear remaining inventories before the year's end, the market is expected to stay under pressure, reinforcing the bearish trend in the Cyclohexane market.