In the first half of January 2024, the global Vinyl Ester Resin (VER) market witnessed a fluctuating price trend in both the European and Asian markets. Initially, the overall sentiment remained pessimistic, reflecting the trend from the previous month in the European market. However, the Chinese market displayed signs of resilience as the New Year kicked off, witnessing a rebound driven by renewed stockpiling efforts by market participants. One contributing factor to the positive momentum in China was the upward trajectory in demand for feedstock Epoxy Resin, influencing the production costs of VER. Additionally, the downstream coating and adhesive manufacturing industries in both Europe and China continued to exhibit firm demand for VER, contributing to market stability.

In the European market, particularly in Spain, a 2% decline in VER prices was observed in December. Despite this setback, there are anticipations of a price reversal in January 2024, primarily fueled by the expected increase in demand from the Asian market. The surge in demand for feedstock Epoxy Resin could further impact the price trajectory of VER in the European region. However, challenges persist in the European market, particularly in the construction sector, where subdued demand prevails. Factors such as escalating prices, rising interest rates, and general economic uncertainties have led to a sustained decline in construction project demand, affecting the domestic market for VER.

During this timeframe in  China, the VER market experienced price fluctuations during the initial half of January. While prices initially increased in the first week, a marginal decline was observed by the end of the period. Further, it is anticipated that the Chinese VER market will continue to experience fluctuations throughout January, ultimately witnessing an overall escalation due to increased demand and restocking activities ahead of the Lunar Holidays. Furthermore, the downstream industries of VER, involved in the production of Fiberglass Reinforced Plastics (FRP) composites for the automotive and construction industries, demonstrated a favorable market demand in China. Further, the rise in the cost of feedstock Epoxy Resin and increased costs of imported materials from Europe may potentially lead to an uptick in VER prices.

Furthermore, disruptions in shipping activities within the Red Sea have resulted in a surge in freight rates in the Asian market, particularly in China. This increase is attributed to the rerouting of ships through the southern tip of South Africa via the Cape of Good Hope, introducing logistical and economic complexities for exporters grappling with the consequences of this altered shipping route.

According to ChemAnalyst, the VER market is projected to remain healthy in the near term, with an expected increase in demand from the downstream industry in the Chinese market. Further, the surge in freight rates and supply chain disruptions may impact product prices in both European and Asian markets. Moreover, the expected uptick in feedstock Epoxy Resin is likely to contribute to an upward movement in the price trend.