Downward Price Trend for European Calcium Hydroxide Contradicts with China in the mid-Oct 2024

Till the mid-October, the prices of Calcium Hydroxide continued their downward trajectory in the Eurozone. The prolonged slowdown in the EU construction industry has further depressed demand, as decreasing construction activity had a direct influence on the requirement for Calcium Hydroxide. The decline in Calcium Hydroxide prices can be primarily attributed to the ongoing slump in the construction sector.

The ongoing downturn in the construction sector has had a profound impact on the demand dynamics of various chemical commodities, including Calcium Hydroxide. Despite efforts by manufacturers to reduce production volumes in response to weaker demand, companies have faced challenges in maintaining profitability.

The sluggish industrial activity and decreasing construction projects have led to a decline in the consumption of Calcium Hydroxide, a key component in various construction applications. This reduced demand has put pressure on market fundamentals, making it difficult for producers to sustain healthy profit margins. As the construction sector continued to struggle, it has put downward pressure on Calcium Hydroxide prices will persist.

Seasonally adjusted construction output in August 2024 grew by 0.1 percent in the eurozone and 0.4 percent in the EU, according to Eurostat. Despite favourable signs in supply chains and pricing, eurozone construction businesses faced a downturn in commercial activity in September. While the housing market has shown signs of improvement, its impact on construction activities is expected to be minimal in the near term. The overall sentiment among construction companies remained pessimistic, with low confidence levels hindering any significant recovery. This continuous slowdown in the construction sector has resulted in low demand for Calcium Hydroxide, influencing market dynamics and contributing to the industry's ongoing challenges.

On the contrary, the prices of Calcium Hydroxide have witnessed a rise in the domestic market of China. Manufacturing enterprises reduced operating rates over the Golden Week holidays have resulted in a restricted supply of finished goods to supplement downstream output. Also, there was active demand from the paper sector.

Looking ahead, the prices of Calcium Hydroxide are expected to rise in China. Demand from key Asian economies like India is likely to be on the higher side. Winter procurements may also begin leading to an incline in the prices of Calcium Hydroxide in the domestic market. However, in the case of the Eurozone, the price trend anticipated for Calcium Hydroxide is anticipated to be the opposite. Inventories are expected to remain high this month due to the previous month's procurement.