Ethyl Acrylate Market Trends: Challenges in Japan and Potential Recovery in Brazil

Santos, Brazil: The Ethyl Acrylate in the global market experienced a mixed price trend in the last week of June 2024. In Japan, the Ethyl Acrylate price is maintaining its stable downward trend as the downstream Coating and Construction enterprises are facing challenges due to labor shortages as a result of regulations proposed in April 2024 for stricter overtime. Whereas, in the South American market, Ethyl Acrylate is showcasing a downward trend after maintaining stability for the past few weeks. The downward trend of Ethyl Acrylate is due to the hindrances experienced in growth due to adverse economic conditions impacted by the flood crises.

In Brazil, during the week ending on 28th June, the Ethyl Acrylate market exhibited a slight decline of 0.2%, settling at USD 1850/MT (CFR-Santos). This decline is driven by decreasing demand for Ethyl Acrylate from downstream Coating and Construction enterprises, while supply levels are exceeding requirements. The extensive flooding in Brazil significantly damaged infrastructure and livelihoods, affecting over 4,500 kilometers of roads, avenues, and highways, which complicated transportation and logistics. This situation is resulting in declining business confidence, reflecting a pessimistic outlook for the Brazilian economy. In the feedstock market, Ethanol prices followed an upward trend, while acrylic acid prices remained stable, leading to variation in production costs. However, these cost variations did not impact the market trend due to the declining demand from the downstream Coating and Construction sectors. Additionally, growth was impeded by unfavorable economic conditions, a weakened currency, and order delays resulting from the flood crisis, which pushed the market toward a bearish trend.

At the same time, Japan is experiencing a steady decline in the Ethyl Acrylate market, influenced by weak demand from downstream Coating and Construction enterprises. These sectors are grappling with severe labor shortages due to stricter overtime rules, known as the "2024 problem," which have impacted various construction projects, including key infrastructure developments, causing delays. Notably, Tokyo’s Edogawa Ward government’s new office building faced a significant two-year delay, resulting in low consumption of Ethyl Acrylate. In addition, in May, the Japan Railway Construction, Transport and Technology Agency (JRTT) announced difficulties in completing the Hokkaido Shinkansen high-speed train line extension to Sapporo by its scheduled opening at the end of fiscal 2030. JRTT President Kozo Fujita attributed the delay to labor shortages and the significant challenges of tunnel construction.

As per ChemAnalyst, the Ethyl Acrylate market is anticipated to experience a decline in the Japanese market due to unfinished construction projects along with continuous labor shortages. However, the Brazilian market might witness an incline in the Ethyl Acrylate market. Paulo Pimenta, appointed by Brazilian President Luiz Inacio Lula da Silva, stated that the Brazilian government has allocated 85.7 billion reals (approximately USD 15 billion) for the reconstruction of Rio Grande do Sul. This initiative might lead to increased prices of essential Petrochemicals including, Ethyl Acrylate.