Price Hike For 1,4-Butanediol & Derivatives

1,4-Butanediol (BDO) is a straight-chain glycol with hydroxyl groups on both ends. Butanediol (BDO) is a common ingredient in cosmetics, pesticides, hardeners, synthetic leather, and plasticizers.

Ashland Global Specialty Chemicals Inc., an American chemical company, announced a price increase for 1,4-Butanediol and various derivative products in North America. The price of 1,4 butanediol is being raised by 45 cents per pound by the company. The price increases will take effect on January 1, 2021, or as agreements allow.

In a press release dated December 2, 2021, BASF, a German multinational chemical company, also announced a 400 EUR/MT price increase for butanediol and its derivatives. The company stated that it expects improved demand across its businesses in fiscal 2022, with no change in its underlying operating performance. It anticipates cost inflation as well as supply chain issues. The company also anticipates the implementation of its strategy, as well as the demonstration of organic growth improvement in margins and enhanced free cash flow generation in fiscal 2022.

Butanediol has been the most important petrochemical among oxo-alcohols because of its versatility, which allows for greater application and, consequently, greater demand. Supply has been tight since the beginning of Q2, and while it has improved significantly, demand continues to outstrip supply fundamentals as the construction sector leads the way in terms of consumption volume. QIRA, a bio-based 1,4 butanediol production, has been proposed by Cargill and Helm as part of a joint venture called Qore. This will be a significant step toward the sustainable production of oxo-alcohols.

As per chemAnalyst, surging Price of Butanediol are due to increasing rates and low availability of its raw material, transportation and logistics issues, and higher operating costs, as well as other factors for rising costs include labour, packaging, and maintenance. The increment is due to limited supply amidst strong demand of solvents in the pharmaceuticals, cosmetics and paint industries.