Prices of Polyurethane Resin (Rheology Modifier) have depreciated by almost 3% in the US in September due to prices of feedstock Methyl Diisocyanate and Toluene Diisocyanate have also depreciated by almost 12% and 13% respectively. 

Polyurethane Resin, which is used as a rheology modifier, is primarily utilized in the paints and coatings sector of the construction industry. However, the demand for this sector has been subdued due to a decline in new orders for the fifth consecutive month. Key market players in the Polyurethane Resin industry have attributed declining orders to restrictive consumer spending as interest rates soared. With mortgage rates reaching a record of approximately 8% in September, sales of new houses plummeted further, negatively impacting the construction industry. This consequently had a negative impact on the demand from the paints and coating sector, because of which prices of Polyurethane Resin in the US market further depreciated. The demand for Polyurethane Resin was further curtailed as input and factory output gate charges also appreciated due to the Federal Bank's high-interest rates to stymie inflation rates.

The downstream automotive sector also did not perform well, with sales in the automotive industry declining by approximately 1%. This was another significant factor for the depreciation in the prices of Polyurethane Resin (Rheology Modifier). With interests largely high due to increasing interest rates, purchasing activities in the automotive industry remained subdued.

Globally, the demand for Polyurethane Resin (Rheology Modifier) fell short of expectations. This was evidenced by declining residential sales in the prime importing country Canada, where new house sales also plummeted by 7%. Inflation rates across the region were recorded to be approximately 4% in August, with anticipations of further increments in September, according to Satistique Canada. Sales in the automotive industry were largely stable, recording only a marginal increment of approximately 4% in September. This moderate demand proved insufficient to stabilize the prices of Polyurethane Resin (Rheology Modifier).

Currently, the confidence for investment in the construction industry remains largely low due to ailing economic conditions, with most activities being largely constricted to repairing existing infrastructure. This ultimately resulted in the sluggish consumption rate of Polyurethane Resin (Rheology Modifier), which resulted in the accumulation of inventories and was detrimental to the product's prices.

Overall, prices of Polyurethane Resin exhibited a bearish trend in September 2023 but are expected to increase in October as prices of upstream Crude Oil surge despite demand from downstream applications being expected to remain submissive due to ailing economic conditions.