German Fluoropolymer Market Holds Steady Despite Global Shipping Challenges

The market of Fluoropolymer (PTFE) in Germany exhibited a phase of stagnancy throughout February 2024 despite the challenges in the vital shipping routes and transition delays. Regardless of the ongoing challenges in the global market, the price of Fluoropolymer in Germany remained relatively unaffected due to the underperformance of the downstream market during this timeframe. However, Fluoropolymer in Europe is heavily influenced by imports from the Asian market. Current geopolitical tensions are expected to disrupt global trade routes and shipping costs, putting a strain on the European Fluoropolymer supply chain in the upcoming weeks.

While the German Fluoropolymer market faced opposing forces of declining demand and rising transportation costs, the overall price remained stable in February 2024. This can be attributed to a balanced equilibrium between low supply and the mitigating effect of high shipping costs to settle at USD 14020/MT, Fluoropolymer (PTFE) Powder Form CFR Hamburg during the week ending on 23rd February 2024. According to the European Automobile Manufacturers’ Association, comparing January 2024 to December 2023, sales of new electric vehicles plummeted by a staggering 54.9%, while sales of plug-in hybrids also experienced a significant decline of 19.6%. Moreover, there was a significant decrease of 54.9% in new EV registrations, from 34,856 in January 2023 to 15,701 in January 2024. As per the German Statistics Bureau, the decline in sales was not only attributed to the sudden withdrawal of tax incentives but also to the underlying economic factors such as a weak economy, high finance costs, and geopolitical tensions. Contrary, several shippers were avoiding the Suez Canal route amidst the potential threat of rebel attacks causing them to look for alternate trade routes.  This has further caused an elevation in the transportation charges. As a ripple effect, low demand and low supply for the product accounted for the stability of Fluoropolymers in Germany. Moreover, China, a major exporter of Fluoropolymer, maintained stable prices, further supporting the current price trend in Germany to keep the prices unchanged.

As per ChemAnalyst, there is a potential for the Fluoropolymers market to surge in the upcoming weeks, as the ongoing Houthi strikes in Yemen and heightened tensions in the Red Sea region could contribute to the rise in shipping costs, influencing the overall market dynamic. However, the future trajectory of Fluoropolymers prices will depend on the resolution of ongoing challenges in the EV market, global shipping disruptions, and broader economic factors as the tensions in the region are further heightened by the Iranian warship's arrival into the Red Sea which could frame the global dynamics adversely.