Stable PENT Prices in North America Reflect Equilibrium in Supply-Demand Dynamics

The Pentaerythritol (PENT) price trend remained stable during the first half of June as producers kept their quotations unchanged amidst a well-maintained balance between supply and demand.

Previously, the orders for PENT were moderately low from the Polyol manufacturers due to sluggish consumption from the Polyurethane segment as the offtakes fell notably in by the domestic and international buyers. The reduced consumption of Polyurethane foam manufacturers from the Automotive sector amid oversupplies of Chinese EV vehicles in the overseas market kept the PENT inventory levels firm in the regional market. Simultaneously, the agrochemical market was moving with the wait-and-watch scenario, and stocking practices were stable for the insecticide producers.

However, the inquiries for PENT improved from the agrochemical producers because of increased consumption in the agriculture sector during peanuts, rice, and Sorghum planting season. At the same time, in May 2024, the Manufacturing Purchasing Manager's Index increased, indicating a modest strengthening in the manufacturing sector's health, marking the fourth positive month out of the last five. In May 2024, new orders in the US manufacturing sector rebounded, leading to an increased pace of production expansion as the second quarter advanced. Furthermore, in May, the Consumer Price Index for All Urban Consumers (CPI-U) remained stable following a 0.3% increase in April on a seasonally adjusted basis. Specifically, the food index saw a slight 0.1% increase in May.

The PENT production rates were also moderate amid the limited availability of feedstock Formaldehyde supplies in the regional market due to consistent demand from disinfectant manufacturers and firm cost support from upstream Methanol. Meanwhile, the cost support was stable on the production costs of PENT from the feedstock Formaldehyde. The PENT production rates were also moderate amid the limited availability of feedstock Formaldehyde supplies in the regional market due to consistent demand from disinfectant manufacturers and firm cost support from upstream Methanol.

According to the ChemAnalyst, the PENT FOB Texas prices in North America hovered around USD 1880/MT in the mid of June 2024.

As per the estimation, in the upcoming weeks, the PENT demand might remain dull from the agrochemical market towards the end of the second quarter of 2024, primarily due to the seasonal slowdown and the impending harvesting season in the agriculture sector. However, the market is expected to revive at the beginning of the third quarter of the year, and the PENT offtakes may improve from buyers for stocking purposes before the hurricane season in the region.