Genoa (Italy): Diisononyl Phthalate (DINP) prices recover in Italian markets second month consecutively in the month of February 2024 after continually deflating in FY23. The recovery in prices was also evident from recovery in manufacturing in PMI with 11-month high score recorded in February 2024 in Italian markets. DINP price revisions upwards also provided positive price pressure for the upward revision of PVC export prices. Overall sentiment in Italian markets remained positive for DINP with demand sentiments gradually improving and downstream PVC markets gradually stabilizing across European markets.

DINP supply in European markets largely dominated by German and Korean suppliers. Upward price revisions in DINP are partially due to longer lead times due to supply chain disruption in Suez route and partially due to recoveries observed in Italian construction markets since FY22. Pricing for February reveals that upward revision of DINP by suppliers from Europe suggests domestic demand is turning stronger with suppliers holding stronger inventories than FY23. Prices deflated by 12% YoY in February 2024 while 4% MoM revision over January 2024 remained. Market intelligence suggests that imports in Italian markets are falling partially due to increasing import prices and partially due to higher inventories of DINP since FY22.

Data reveals that since FY22, Italian imports of DINP remained elevated with higher import prices despite global downstream PVC markets slowing down in FY23 with significant price falls across the board. Downstream PVC markets showed upward revision of prices in February due to strong export and domestic demand in Italian markets. On producer front, input prices overall declined on a YoY basis while picking up Q-o-Q basis with 6% elevation observed M-o-M basis in feedstock prices. European suppliers are observing recovery in manufacturing with construction activities picking up in Eurozone as European sustainable transition continues.

BASF remains major supplier of DINP to Italian markets, revealed in FY24 outlook that German demand of PVC to improve with sustainable transition and recovery in demand with DINP markets to tighten for other importers due to limited production situation as BASF is anticipated to keep lower inventories for cost optimization in FY24. Supply Chain disruption in Suez has triggered strong holding of supply of DINP in Germany, similar sentiments were observed in Chinese and Korean markets.

ChemAnalyst’s forecast of upward price revision is retained in the month of March as market sentiments remained largely bullish with major suppliers anticipating steady recovery in manufacturing with mortgage falling to fall in the coming months as US Federal reserve promised rate cuts. DINP export prices to USA is also showing upward revision with improvement in volumes anticipated by 5% in FY24. Downstream PVC markets to begin stable recovery in second half of FY24 as definite rate cuts by US Federal reserve to improve inventory adjustments and sizing up signals to chemical suppliers.