Significant Demand Rebound Pushes Cellulose Ether Prices to Rise in the USA, July 2023

Prices of Cellulose Ether have largely remained stable throughout July 2023 across China and India, with a marginal increment being observed in the United States. Demand from the major existing downstream construction industry appears to have an insignificant impact on the current market prices.

Prices of Cellulose Ether have shown a marginal increment of 2% in the North American market despite falling prices of feedstock Propylene Oxide. Heightened inflationary behaviors of the local populace saw an increase in purchasing activities of food and medicines amongst consumers, where Cellulose Ether is majorly used as a binder. A healthy recovery in construction activities from the first week of July 2023 also contributed to the hike in Cellulose Ether prices along with the increasing Producers Price Index. On the demand side, significant offers from international inquiries were made from countries such as India, Belgium, and the United Kingdom, thereby further driving up the costs of the commodity. Demand is expected to remain high as consumers continue to stock up on food and medicines due to continued inflationary behavior, consequently slowing economic growth.

In the Chinese market, a stagnant trend in the prices of Cellulose Ether was observed due to the insignificant movement of the construction industry in July 2023. Moreover, little to moderate demand from the cosmetic industry and bleak export offers from India prevented the increments in the price of the Cellulose Ether. A marginal decline has been observed as traders in China attempted to sell inventories at discounts, which unfortunately proved to be in vain. The construction industry recorded low growth due to the downturn in residential, commercial, and retail segments. The demand from the cosmetics industry altogether prevented a bearish situation from being witnessed in the prices of Cellulose Ether. Merchants in the country had sufficient inventories to cater to the needs of the cosmetics and construction industry, which compelled them to work through their existing inventories.

In the Indian market, prices of Cellulose Ether have maintained stability throughout July 2023, as the demand from the construction and automotive sector remained unchanged. The arrival of monsoon season may not positively impact the demand for Cellulose Ether from the downstream construction segment. Overall, the slowing of the construction industry due to monsoon rains and suppliers having ample inventories to cater to the market's requirements were the prime reasons for the stable price of the commodity. Prices are not expected to change until the termination of the monsoon season, during which supply might improve.

In conclusion, prices of Cellulose Ether are expected to remain stagnant in the upcoming months. However, marginal increments due to disruptions in the supply chain and insignificant demand from minor downstream industries may be exhibited in the Chinese and Indian markets, respectively.