Glycol Ether Price Drop in Europe as Demand Wanes

The European producers reduced their Glycol Ether prices by 4.3% in the first half of June 2024 amid ample availability of supplies with moderate to low demand from buyers and importers. Glycol Ether orders from the international market diminished amid a decline in imports from Asian importers due to weak consumption in the FMCG sector. In the Consumer Brands division, total sales decreased nominally by 6.0% to 2,605 million Euros compared to the previous year. However, organic sales, adjusted for currency effects and acquisitions/divestments, rose by 5.2%. Pricing remained strong, but volume declined slightly due to ongoing portfolio adjustments. Foreign exchange fluctuations decreased sales by 4.0%, and acquisitions/divestments further reduced sales by 7.2%.

At the same time, Glycol Ether offtakes were moderate amid the decline in the stocking practices from the buyers, and the market experienced consistent availability of stocks amid optimum operating rates at manufacturing facilities. In May 2024, manufacturing activities improved slightly in the European region, indicating an ease in the deterioration in manufacturing business conditions. Despite a decrease in factory output, the contraction observed was the mildest in slightly more than a year and only minimal overall, marking the slowest rate of contraction in two years. The cost support was firm from feedstock Ethylene amid a rebound in upstream Crude oil prices and reduced stockpiles in the international market amid increased consumption from the buyers.

Previously, the Glycol Ether offtakes were firm from regional personal care products, cleaning agents, cosmetics, and pharmaceutical manufacturers. Henkel's report emphasizes strong performance in Laundry & Home Care, showing robust growth in key categories despite challenges in portfolio adjustments impacting overall sales. At the same time, in May, consumer prices in the Euro Area, as measured by the Consumer Price Index (CPI), rose by 0.5% compared to the previous month, indicating a moderate increase in the cost of goods and services for consumers across the region. Usually, the demand for cleaning agents and disinfectants demand remains firm during summertime. Simultaneously, Glycol Ether productions were consistent by the manufacturers amid ample availability of Ethylene supplies in the regional market and the reduction in consumption from the Polyethylene industries.  It reduced the production costs of Glycol Ether.

According to ChemAnalyst data sources, at the end of the first half of June 2024, Ethylene Glycol Monobutyl Ether (GE) FOB Hamburg prices witnessed USD 1570/MT.

As per the estimation, the demand for Glycol Ether might decline from buyers towards the end of the quarter. The Glycol Ether consumption may decrease from the Pharma sector. It will improve the market inventory levels. So, the Glycol Ether market players would reduce their quotations to improve offtakes from the market.