OQ Chemicals, a prominent player in the realm of oxoalcohol production, headquartered in Oman, has made an announcement regarding a forthcoming price increase for 2-ethylhexanol across the global market. This adjustment is scheduled to be implemented on March 1, 2024. In specific terms, OQ Chemicals has communicated a price surge of EUR100 per tonne for the European market and EUR110 per tonne for both the North American and Asian markets, respectively.

The impetus behind this price revision is grounded in the anticipation of continued escalations in the prices of propylene raw materials with high chemical purity in the global market. The ripple effect of such increases in raw material costs is expected to directly impact the production costs associated with oxoalcohols. The current challenges persisting within the supply chain system contribute to the mounting transportation costs, adding another layer of complexity to the market dynamics.

Examining the demand side of the equation, it becomes evident that the North American and Asian markets exhibit robust demand for 2-ethylhexanol, particularly within process industries such as plasticizers and paints, as well as in the construction and automotive sectors. Despite a downturn in the automotive sector, the residential homebuilding segment in North America continues to flourish. This growth is fuelled by an enduring shortage of used homes in the U.S. market, reflected in escalating costs and the anticipation of strong demand for housing during the upcoming spring months.

In contrast, the European market portrays a nuanced scenario where the pricing dynamics for 2-ethylhexanol are intricately tied to the ascent in production costs of propylene raw materials. A notable increase of 1.3% in the first half of February 2024 underscores the upward trajectory in these production costs. This uptick is primarily attributed to the crisis in the Red Sea, causing delays in propylene imports. On the demand front, the European landscape presents a different picture. The construction sector in February 2024 witnessed contractions due to project cancellations and a reduction in building permits. All segments within the construction sector – residential, commercial, and civil construction – experienced significant declines. Consequently, this contraction in the construction sector exerted a dampening effect on the plasticizer processing industry.

Understanding the intricacies of regional market dynamics is crucial for stakeholders in the oxoalcohol industry, especially against the backdrop of fluctuating raw material costs and demand variations across diverse sectors. The interplay between supply chain challenges, geopolitical crises affecting raw material imports, and the divergent trajectories of construction sectors in different regions collectively shape the pricing and demand landscape for 2-ethylhexanol.