In the first half of January 2024, the global 2-Ethylhexanoic Acid (2-EHA) market continued its upward trajectory, aligning with the trend observed over the past two months. OQ Chemical's earlier price increase set the stage for subsequent increments by small traders, contributing to the overall upward trend. The surge in the price of crucial raw material Crude Oil during this period added to the production costs, exerting upward pressure on 2-EHA prices. Firm demand from the downstream automotive industry and ongoing trade uncertainties remained key factors propelling the upward trajectory of 2-EHA prices.

In the United States, January 2024 witnessed an upward surge in 2-EHA prices, primarily attributed to heightened shipping rates originating from the country. Uncertainties in major shipping routes, driven by persistent attacks on ships in the Red Sea, led to increased ocean freight rates, raising concerns about inflation and delayed goods. Strategic redirection of trade away from the crucial Middle East route due to potential strikes by Houthi militants further complicated global trade dynamics, resulting in elevated transportation costs. To safeguard profit margins, traders responded by increasing the prices of various commodities, including 2-EHA. Concurrently, insights from market participants revealed robust growth in the US automotive market. The improvement of the US automotive market in the previous year, bolstered by improved availability and heightened demand, is anticipated to persist in January 2024.

Similarly, the European market experienced a surge in 2-EHA prices during the same period, influenced by rising raw material costs, increased production costs, and trade uncertainties.  OQ Chemical, a prominent player in the oxo products industry, took a strategic step to maintain profitability by globally increasing the price of 2-EHA by USD 100 per metric ton in November 2023, responding to the escalating raw material prices. This move set the tone for subsequent months, as small traders gradually followed suit, contributing to the continuous rise in the material's price. Market reports indicated that German automotive producers raised automotive prices by 2% on 1st January, responding to the rising costs of materials like 2-EHA and higher operating expenses. Despite global inflationary pressures, demand for 2-EHA from the downstream automotive sector remained firm, sustaining the bullish trend initiated in December 2023 during the festive season.

ChemAnalyst, anticipates that the 2-EHA market prices may continue to surge in the coming days, driven by rising input costs, increased operating rates, and sustained demand from the downstream automotive industry. The complex interplay of global factors highlights the dynamic nature of the 2-Ethylhexanoic Acid market as it navigates challenges and opportunities in the current economic landscape.