As of late December 2024, the Asian n-Butanol market is grappling with significant challenges, reflecting a volatile and increasingly precarious outlook. While East Asia remained relatively stable, the Chinese n-Butanol market experienced sharp volatility, and the Indian n-Butanol market continued its downward trajectory as major producers slashed prices. Demand for n-Butanol remained subdued, especially from the off-season paints and coatings sectors, while the construction industry in both Japan and India faced persistent struggles, further impacting n-Butanol consumption.

In Japan, housing starts have been plummeting since October 2024. This drop was largely driven by significant downturns in rented, built-for-sale, and pre-fabricated units, with growth only observed in owned and issued categories. This marked the sixth consecutive monthly decline, signaling a continued slowdown in n-Butanol demand. Japan’s n-Butanol prices fell by around 1% but remained elevated due to JNC Corporation's price hike of Yen 20,000/MT in late November 2024. JNC cited rising plant maintenance costs, aging facilities, increased material prices, and labor shortages as reasons for the price increase, stating it was difficult to absorb these costs alone.

Despite government stimulus efforts, China’s construction sector has remained sluggish, with dropping property investment towards year-end. New construction starts and property sales also saw considerable declines, deepening the sector's condition and further dampening demand for n-Butanol. In China, n-Butanol prices saw a series of revisions, initially climbing by 1.1%, then dropping by 2.8%, before stabilizing. The production conditions for n-Butanol remain strained, with tight propylene feedstock supplies and ongoing negotiations for long-term contracts through 2025. Additionally, PDH unit operating rates fell by 10% in November 2024, with current rates at just 68.12%, highlighting significant operational challenges for n-Butanol production ahead.

Supply conditions for n-Butanol showed some improvement as Formosa Plastics resumed production at its Mai Liao facility in Taiwan, which has a production capacity of 250,000 MT/year, in mid-December after a maintenance turnaround in mid-November 2024. However, import prices remained under intense pressure, exacerbated by a surge in freight charges in December due to ongoing congestion across Asia.

The Asian n-Butanol market remains under significant pressure as it approaches the end of 2024, with weak demand from key sectors such as construction and paints, coupled with supply constraints and rising costs. Japan's declining housing starts, China's sluggish construction sector, and India's downward price adjustments underscore the broad challenges faced by the region. While supply has shown signs of improvement with Formosa Plastics' production resumption in Taiwan, rising freight charges and constrained propylene feedstock supplies continue to weigh on the market.

As per ChemAnalyst, with volatility persisting, market players in the n-Butanol industry face an uncertain outlook heading into 2025.