Demand Drives Rise in Asian Calcium Formate Prices

Qingdao (China): In the last few weeks, Calcium Formate prices have increased across Asia, spurred by increased demand in key countries such as China and India. Following the Labor Day holiday, heightened negotiations in China’s Calcium Formate market led to price increases. The downstream cement and concrete spot markets also contributed to the price rise, bolstered by strong futures market performance and a favorable macroeconomic environment. Additionally, the rise in international crude oil futures provided cost support, fostering a positive trading sentiment within the Calcium Formate market. Traders actively procured goods, reflecting an optimistic market outlook. However, the feedstock formic acid market remained unaffected due to high stockpile levels.

The increase in China's exports, growing by 1.5% year-on-year in April 2024, positively impacted the domestic market of Calcium Formate, indicating a rebound in both local and international demand. This boost in investor and consumer confidence contributed to the revival of economic activity, especially in export-dependent sectors like petrochemicals. The steady rise in crude oil prices, driven by positive demand signals from the US and geopolitical tensions in the Middle East, influenced the cost structure of Calcium Formate. Despite these challenges, China's manufacturing activity continued to expand, albeit at a slower pace due to rising production costs.

In recent weeks, there has been a surge in demand from downstream cement and concrete sectors in both China and India, driven by significant developments in their respective housing industries. Despite the sector's weaker performance compared to the same period last year in China, there has been a notable increase in the average new home price across major cities, marking a significant rise. Although total sales among real estate companies experienced a decline in the first quarter, sustained demand is expected to support healthy Calcium Formate prices. Calcium Formate, integral to various construction materials, is experiencing increased demand. As of May 17, 2024, Calcium Formate reached USD 500/MT, FOB Qingdao, marking a 2% increase, driven by robust demand and higher production costs due to increased coal prices and a positive outlook in the construction sector.

Notably, India has witnessed a surge in home sales, particularly in its top eight cities, indicating a thriving real estate market. UltraTech, a leading cement manufacturer, reported a remarkable 35% surge in net profit during the fourth quarter of FY24, reflecting robust demand for Calcium Formate. This growth is attributed to government spending on infrastructure and increased investment in affordable housing projects, further bolstering the Calcium Formate market.

According to ChemAnalyst, the Calcium Formate market is entering a period of uncertainty in the coming months. Factors like China's domestic demand and India's monsoon season are expected to significantly influence the market landscape. Additionally, potential policy changes add to the unpredictability, necessitating careful monitoring and strategic planning by industry stakeholders to effectively navigate potential market shifts.