Downstream Sector Demand Pushes Butanediol Prices in the US Market

Texas- Butanediol prices continued to escalate in the US market as the downstream (coating, tetrahydrofuran, and polybutylene terephthalate) sectors regained power. January month has witnessed a downfall in the market prices as the manufacturers had destocked the product. However, the Butanediol market regained production strength in February as the production capacity inclined and the natural gas prices slowed. Warm weather conditions and slower gas consumption by commercial and industrial consumers have resulted in a decline in energy prices in the US market. Towards the end of the third week of February, the final prices of Butanediol ranged between USD 2280-2440 per MT, FOB Texas.

The derailment accident that occurred in the Ohio region of North America has shaken the petrochemical industries in the regional market. The market participants have predicted an alarming situation as the government is pressured to take strict actions against industries. However, the demand strength for the product from the downstream housing and coating sector governed the final prices of Butanediol in the US market. According to the official data published by the National Association of Home Builders (NAHB), the builders have showcased positive interest in constructing new houses. With an incline in the construction of new houses, the coating industries have also regained power.

Adding to the facts, easy transportation of the feedstock and the higher trading volume from overseas markets supports the inclining prices of Butanediol in the US market. This week's logistics news is highlighted by the fact that US spot and contract truck rates for domestic deliveries have significantly dwindled since the year's beginning. As per ChemAnalyst, the final prices of Butanediol are anticipated to follow the inclining trend as the upstream (crude oil) may remain in demand, and the prices may continue to incline. Manufacturers and suppliers will come under pressure as production costs will escalate proportionally, impacting the final prices of Butanediol in the US market.