The EAA Copolymer Prices Plays a Game of Balance in June 2024

In the first half of June 2024, the Ethylene Acrylic Acid (EAA) copolymer market in Asia exhibited a stable trend with a minor price decline, primarily due to consistent demand from the packaging and coating industries and eased upstream costs. This stability in the EAA Copolymer prices was maintained by a balanced equilibrium between supply and demand within the regional market, supported by steady inquiries from Asian markets such as India and Indonesia. Additionally, the prices of feedstocks Ethylene and Acrylic Acid persistently experienced a downward trajectory this month, further easing the cost pressure on EAA Copolymer producers in the region.

In China, the EAA Copolymer prices were in a southward direction due to low demand in the automotive industry and eased feedstock costs. Recently, the feedstock acrylic acid market has faced challenges, and the focus of negotiations in the acrylic acid market remained stable but with a bearish sentiments. Additionally, China’s consumer inflation rate is expected to remain weak shortly due to persistently weak domestic demand, raising worries about the risk of deflation as the nation’s economic recovery struggles to gain traction.

The Downstream buyers in the EAA Copolymer industry in the region have predominantly opted for minimal purchases, showing caution towards high-priced raw materials. In response, some companies have offered discounts to stimulate transactions.

The overall EAA Copolymer market trading atmosphere in the export market has been flat, with sellers actively shipping products in the first half of June. Additionally, the upstream crude oil prices also impacted EAA Copolymer production costs, as the international crude oil futures have closed lower, with the settlement price of the main WTI crude oil futures contract in the United States at USD 80.73 per barrel, a decrease of 0.7%. The settlement price of the main Brent crude oil futures contract was USD 84.33 per barrel, a decrease of  0.6%.

The recent decline in downstream automotive production has somewhat reduced the demand for EAA Copolymer. Consequently, the EAA Copolymer market is anticipated to stabilize in the short term with minor fluctuations in the second half of June 2024. However, if the decline in downstream production persists, the price of EAA Copolymer is likely to decrease from its current level in the future.

As per ChemAnalyst, the EAA Copolymer prices are expected to stabilize as the downstream players are likely to be cautious about the weak downstream consumption and ample stocks. China's EAA Copolymer producers are reportedly emphasizing the need to be "flexible and responsive" in response to slower demand growth, a plentiful local supply of intermediate chemicals, and a moderate increase in the end-use market.