Fused Silica Prices Drop Globally as Demand Weakens and Supply Issues Persist

In August 2024, the Fused Silica market experienced a downward price trend in both the Asian and European regions, driven by a combination of bearish market conditions. In Asia, the market was impacted by reduced demand from the construction sector, particularly for refractory materials and adhesives, alongside diminished consumption from the glass industry. The situation was exacerbated by port congestion and severe weather conditions due to the typhoon in the region, which caused heavy rainfall and disrupted construction activities in Asia which led to a notable decrease in Fused Silica consumption. Concurrently, the European market faced economic slowdowns and weak demand from the housing sector, further contributing to lower consumption of construction materials, including Fused Silica. Supply chain disruptions along key trade routes, ongoing geopolitical tensions, and congestion at major Asian ports compounded these issues, intensifying market pressures. Consequently, the price of Chinese Fused Silica FOB Shanghai saw a decline of 1% for the month, reflecting the broader trends in both regions.

The European Fused Silica market has seen a significant drop in prices, primarily due to reduced demand from the construction sector. The construction industry in the Eurozone continues to struggle, with August seeing ongoing declines in housing activity and deteriorating employment conditions, which have negatively affected Fused Silica demand. Market participants are growing increasingly skeptical about a potential recovery in the sector, which could influence future demand for Fused Silica in Europe. Additionally, congestion at major container ports in Northern Europe has intensified, prompting some carriers to bypass port calls, although this has not led to major shipment delays. Overall, the combination of weak demand, ongoing supply chain challenges, and market uncertainty has contributed to a softened market, as producers face difficulties in adjusting production to lower consumption levels, impacting the price trend of Fused Silica.

In August 2024, the Asian Fused Silica market continued its downward trend, influenced by weak demand in the construction sector and exacerbated by ongoing supply challenges, including severe port congestion. In China, a critical market in the region, a slowdown in factory activity, coupled with a prolonged property sector crisis, intensified economic strain. Heavy rainfall further impacted the market by disrupting production and transportation activities, and adversely affecting the downstream construction industry. To address supply-side constraints, merchants were encouraged to expedite stock liquidation amidst varying production resumption levels. Furthermore, the Indian Fused Silica market experienced low demand, with reduced costs for imported materials. Severe weather conditions at Kandla Port caused significant delays and hindered cargo operations, exerting pressure on container flows from India’s west coast ports. Torrential rain and flooding at Mundra Port further exacerbated vessel delays and capacity constraints. Despite these logistical challenges, the combination of low demand and ample product availability has maintained downward pressure on Fused Silica prices in the Indian market, keeping them relatively low.

According to ChemAnalyst, the price trend for Fused Silica in September 2024 is anticipated to continue the bearish pattern seen in August. The European market is expected to persist in its downward trend due to ongoing weak demand from the construction industry. In China, seasonal influences, particularly the effects of the monsoon season, are likely to introduce fluctuations in Fused Silica demand within the construction sector.