Global Pentaerythritol Prices Fall Amidst Declining Consumption Rates From End-Users
- 27-Jun-2023 3:39 PM
- Journalist: Stella Fernandes
From the beginning of the year, Pentaerythritol prices were consistently decreasing in the European region due to reduced manufacturing activities and depressed consumption rates from end-users. During June 2023, the Pentaerythritol price trend remained persistent and again contracted in the regional market.
As per the sources, the inventories were sufficient to cater to the downstream industries due to the availability of previous stocks. Meanwhile, the orders and offtakes were stable to low from the downstream buyers during June 2023 as buyers were conscious while making any purchases due to increasing bank interest rates in Europe to curb rising inflation in the region.
The demand for Di Pentaerythritol was low from the downstream Polyurethane coating industries due to weak activities in the construction and manufacturing sector and surplus availability of supplies. Similarly, globally depressed activities in the agriculture sector reduced the demand from insecticide producers.
Concurrently, the USA’s and Europe’s manufacturing Purchasing Manager’s Index fell during May 2023 and remained below 50, indicating a contraction in manufacturing activities during the month.
Meanwhile, the cost support on Pentaerythritol eased because of a decline in Formaldehyde costs during the past couple of weeks due to increased inventory levels because of a decline in demand and a reduction in upstream Methanol prices. Furthermore, the decline in Natural Gas prices in the past few months due to surplus availability and dampened consumption rates reduced the cost support on the Pentaerythritol prices. The recent normalization in freight costs negatively impacted the final costs of the product.
Similarly, in the USA, the prices decreased amid the sufficient availability of stocks and moderate export rates. The upstream cost support was low from the feedstock Formaldehyde due to the consistent decline in the prices during the month due to high oversupplies and reduced production costs.
According to the ChemAnalyst database, In the European region, the Pentaerythritol prices decreased by almost 3% in June 2023, and Pentaerythritol (PENT) FOB Hamburg and Pentaerythritol (PENT) CFR Antwerp were settled at USD 2840/MT and USD 2810/MT, respectively. Similarly, the Pentaerythritol (PENT) FOB Texas prices hovered at USD 3045/MT in the USA.
As per the estimation, Pentaerythritol prices will likely increase in the upcoming weeks as manufacturing activities will increase in the Polyurethane industries. The demand and consumption rates will likely improve from buyers. Simultaneously, the increasing energy costs amid the rebound in Dutch TTF natural gas futures will raise the variable production costs of Pentaerythritol.
