Fused Silica Price Witnesses Downturn in Asia and Europe Amid Bearish Market Sentiments

In the first half of November 2024, the Fused Silica market witnessed a downward price trend across Asia and Europe due to bearish market sentiment as the year approached its end. In Asia, reduced demand from the construction sector, particularly for refractory materials and adhesives, alongside weaker consumption from the glass industry, drove the decline. Typhoon-induced severe weather and port congestion further disrupted construction activities, amplifying the decrease in Fused Silica usage. Similarly, Europe experienced economic slowdowns and weak housing sector demand, which dampened consumption of construction materials, including Fused Silica. Additional pressure stemmed from supply chain disruptions along critical trade routes, geopolitical tensions, and congestion at major Asian ports. As a result, Chinese Fused Silica prices dropped by 2.4%, settling at USD 610/MT FOB Shanghai by November 15, reflecting the challenges faced in both regions.

The European Fused Silica market has faced a significant price decline, driven by weakened demand from the struggling construction sector. With domestic suppliers and importers focusing on inventory reductions ahead of year-end, de-stocking efforts have dominated market activity. The Eurozone's construction sector continues to face challenges, highlighted by a sharp drop-in housing activity in October, with housing construction rates hitting record lows and reducing Fused Silica demand. Logistical issues at Hamburg’s Container Terminal Altenwerder (CTA), including ship delays due to disruptions in the Red Sea, U.S. port strikes, and berth construction, have further strained operations. These challenges forced carriers to skip sailings and pushed export volumes beyond storage capacity. Despite these disruptions, the market maintained adequate supply to meet domestic and international needs. However, subdued economic indicators and lackluster industrial performance have kept the overall market tone weak, preventing upward pressure on Fused Silica prices.

In early November, the Asian Fused Silica market continued its downward price trend, driven by weak demand from the construction sector and sluggish consumption in key industries such as semiconductors and refractory manufacturing, which heavily depend on Fused Silica for furnaces and kilns. Persistent inactivity in these sectors, coupled with year-end seasonality, kept traders cautious, limiting stockpiling. Exports from China also declined due to reduced demand in other Asian markets, intensifying pressure on domestic producers and further reducing Fused Silica prices. The market remained oversupplied, squeezing producer margins as weak export momentum and cautious investment climates added to uncertainty. Typhoon Kong-Rey exacerbated logistical issues, causing significant congestion at major Asian ports like Shanghai, Ningbo, and Kaohsiung, leading to delays and extended vessel waiting times. Despite these challenges, inventory levels were sufficient to meet demand, ensuring no significant shortages but maintaining the oversupply and downward pressure on Fused Silica prices.

ChemAnalyst projects that the global Fused Silica market will sustain its downward price trend through November and December 2024, primarily due to widespread year-end destocking activities. As producers and traders prioritize inventory reductions ahead of the new year, prices are expected to face further pressure. Additionally, subdued demand across key sectors and reduced production costs are anticipated to reinforce the declining price trajectory, keeping the market tone weak in the coming months.