On December 12, 2024, Dow announced the production of VORANOL™ WK5750, an advanced Polyether Polyol, at its Freeport plant. Designed for high-performance foam applications like mattresses and furniture, it offers superior softness, resilience, and purity. This product is expected to drive demand in North America, potentially leading to upward pressure on Polyol prices, especially in advanced segments. However, supply availability remains moderate to low due to reduced production rates and strained upstream Propylene supplies, which could result in tighter market conditions and constrained inventory levels through Q1 2025.

VORANOL™ WK5750 unique composition serves as an effective cell opener for viscoelastic and high-resiliency foam applications. Polyol offers enhanced reactivity, optimal viscosity, and high purity, making it a key solution for various industries. This addition strengthens Dow’s commitment to advancing flexible foam capabilities and meeting evolving customer needs.

The high-quality attributes of VORANOL™ WK5750 and its production at Dow's Freeport facility may lead to upward pressure on Polyol prices in North America, particularly in advanced Polyol segments. Manufacturers aiming to produce superior foams may drive demand, allowing Dow to command a premium price. The overall impact on prices will depend on factors like production capacities, supply chain dynamics, and demand in key end-use industries.

However, the overall impact on Polyol prices will depend on factors such as production capacities, supply chain dynamics, and demand fluctuations in key end-use industries. If the adoption of VORANOL™ WK5750 increases significantly, it could contribute to a market-wide shift in pricing trends for Polyether Polyols, especially those targeting high-end foam applications.

Meanwhile, Polyol offtakes to produce polyurethane materials in the paints and coatings industry remained moderate amid restructuring efforts, with a continued focus on green building materials and environmental coatings, as companies like Sherwin-Williams capitalized on growth. Simultaneously, in the Automotive sector, Polyol orders for polyurethane materials were supported by a 9.3% increase in total vehicle sales in December, driven by strong demand and year-over-year growth in vehicle production. The orders are anticipated firm during the middle of Q1 as the Chinese market will be closed for the Lunar New Year holidays, potentially causing a temporary lull in supply from this key region.

Additionally, the supply availability was moderate to low in the market, attributed to reduced production rates amid low availability of upstream Propylene due to increased demand for purposes during peak winter. Anticipations are, Polyol production is expected to stay low due to the strained availability of upstream Propylene supplies, which could hinder overall output levels.  As a result, Polyol inventory levels in the market is likely to remain constrained, further contributing to tight market conditions in Q1 2025.