Phenolic Resin prices faced downward pressure throughout November 2024 across the global market, primarily driven by subdued demand and ample supply. In Asia, particularly China, the market remained oversupplied, with weak procurement activities from downstream sectors like paints, coatings, adhesives, insulation materials and other downstream industries. Similarly, the European and USA market experienced bearish trends due to a slowdown in construction activities, further impacting Phenolic Resin consumption.

In China, Phenolic Resin prices continued their downward trajectory amid tepid demand and persistent oversupply. The sluggish performance of the construction sector, coupled with weak demand from key downstream industries, significantly weighed on market dynamics. High production rates led to elevated inventory levels, while end-users prioritized minimal procurement to control costs, further depressing demand.

Market sentiment remained bearish, with downstream factories grappling with limited profitability and cautious purchasing behaviors from end-users. Weak cost support from feedstocks such as phenol and formaldehyde further exacerbated the price pressure. Additionally, increased production capacity following the Golden Week holiday intensified the supply-demand imbalance, keeping market momentum subdued.

Suppliers, facing mounting inventories, offered price concessions to stimulate shipments, but downstream buyers maintained a focus on rigid demand purchases, showing hesitancy to chase higher prices. This cautious approach by terminal enterprises placed additional constraints on the demand side, limiting any potential recovery in the Phenolic Resin market.

The European Phenolic Resin market followed a similar trajectory, with prices declining due to a slowdown in construction activities. This impacted demand in downstream industries like paints, coatings, adhesives, and automotive applications. According to official data, construction output in the Eurozone and broader EU fell by 0.1% in September, with building construction output contracting by 0.8% to 0.9%. Weak procurement patterns and competition from APAC exporters managing excess inventory added further pressure. While feedstock phenol costs softened, slightly higher formaldehyde prices provided limited support.

In the U.S., Phenolic Resin demand remained muted, exacerbated by a decline in new home sales, which fell 17.3% in October to their lowest level in nearly two years. Rising mortgage rates and hurricane disruptions significantly impacted buyer activity, curbing demand in the construction sector. Further, In North America, paint and coatings company PPG reported a 1% drop in Q3 2024 net sales to $4.6 billion, reflecting weak demand. This, in turn, reduced the consumption of Phenolic Resin in related downstream industries.

As per ChemAnalyst’s analysis, Phenolic Resin prices are expected to decline further due to high inventories and weak feedstock costs. The restart of all domestic phenol-ketone plants in China by December will boost supply and lower production costs. Globally, subdued downstream demand and ample supply are likely to keep the Phenolic Resin market under pressure, with additional price drops anticipated in the near term.