Phthalic Anhydride Prices Plummet in the US Market Amid Subdued Demand

The prices of Phthalic Anhydride witnessed a significant decline amid notable stability in trend during the past few weeks. The market conditions remained constant with a bearish outlook. According to the analysts at ChemAnalyst, the prices of Phthalic Anhydride stood at USD 1570/MT FOB Texas during the second week of November 2024, showing a significant decline of almost 2% from the previous week. The decline in the prices was attributed to various factors impacting the supply and demand dynamics which ultimately impacted the market outlook and price trend.

The decline in Phthalic Anhydride prices was attributed to declined demand from the downstream sectors. The downstream sector for Phthalic Anhydride is plasticizer domain which is majorly consumed in Performance materials and coating companies. The stability in the bearish market outlook in the past weeks was supported by the stable market trends. As per the Q3 earnings report published by DOW Chemicals, regional prices showed no significant year-over-year change. The growth observed in the Packaging and Specialty Plastics segments was offset by a reduction in Performance Materials and Coatings. Similarly, overall volumes remained unchanged, with higher demand for functional polymers being counteracted by a decrease in polyethylene volumes. Flat volumes led to flat prices which contributed to the overall bearish market trend for Phthalic Anhydride in the past few weeks. Moreover, sufficient inventory levels and competition from market participants to boost sales also pushed the prices in the downward direction.

In the feedstock market, the prices of Naphthalene and ortho-xylene showed remarkable stability indicating towards stable production cost. Despite stable production cost, Phthalic Anhydride prices reduced in the market during the second week of November. The drop in Phthalic Anhydride prices was owed to declined buying interest from the downstream sectors. The supply of Phthalic Anhydride in the market remained robust while demand was subdued which put downward pressure on the prices. So, the overall market sentiment remained bearish, leading to declined prices.

Looking further, the demand for Phthalic Anhydride is not expected to improve in the upcoming weeks as the demand is expected to reduce further, and that the market sentiment is likely to be bearish. ChemAnalyst anticipates the average monthly decline in prices of Phthalic Anhydride for this month (November 2024) to be around 2.5% from October. Other factors such as logistical issues, potential changes in government regulations due to the recent Presidential elections may impact the market. In addition, new or unexpected supply disruptions and changes in raw material cost may also influence the Phthalic Anhydride market dynamics.