Fatty Alcohol Prices Decline Amidst Easing Demand and Lower Input Costs

The week ending on 16^th of August 2024 saw a moderate decline in Fatty Alcohol prices in the Asia-Pacific region. This trend is the extension of similar pattern observed in the previous month. The decrease in Fatty Alcohol prices can be ascribed to the decline in the price of feedstock palm oil combined with the restricted procurement from the downstream end-use industries. The domestic market's excess supply of finished Fatty Alcohol stocks raised supply-side pressure. The market mood was tempered by a decline in demand from the downstream Personal Care sector. Another key factor for the price decline in Fatty Alcohol was easing transportation expenses due to the relatively low freight rates.

The domestic palm oil market in China has been witnessing a fall in its prices. Palm oil being a key raw material in the manufacturing of Fatty Alcohol has a direct bearing on its pricing. Hence for the week ending August 16th, the prices of Fatty Alcohol C12-14 - CFR Shanghai (China) were quoted as USD 1670 per ton.

In the USA, Fatty Alcohol prices have experienced a minor decrease in the week ending 16^th August. The decrease in prices can be attributed to average demand from the downstream Personal Care Industries and sufficient availability of Palm Oil supplies ensuring steady production. Furthermore, the finished goods supply chain continued as usual ensuring steady availability in the market. However downstream manufacturers refrained from making large purchases either due to market circumstances or strategic stock management. Therefore, the prices of Fatty Alcohol C12-15 DEL Louisiana prices were settled at USD 1870 per ton in the week ending 16th August.

Over 9,000 workers at Canadian Pacific Kansas City and Canadian National railroads were locked out due to strike notices. The shutdown, which moved over USD 1 billion worth of goods daily, posed a threat to the nation's economy and hurt trade with the US. Canada's chemical production was primarily exported to the US, and its trucking industry was not a viable alternative due to insufficient capacity or drivers.

Although the work stoppage will begin on August 22, the effects on chemical manufacturers and other businesses will become apparent sooner since they have to reorganize their supply chains and get ready for possible facility closures. Large petrochemical factories in the region may consider expensive alternative of shutting down and restart because they need a steady, dependable rail supply to operate continuously. Restoring the chemical companies' output rate to normal may take weeks or even months, depending on how long a train disruption lasts.

According to the pricing Intelligence of ChemAnalyst, the prices of Fatty Alcohol are likely to rise in the regional markets. It is anticipated that palm oil prices will be on the higher side for the upcoming weeks, pushing the manufacturing costs of Fatty Alcohol on the higher end.