The Polyol price trend showcased upward movement at the beginning of Q3 of 2024, and producers raised their quotations by almost 1% during the month amid positive demand outlooks. The demand for Polyol remained steady in the downstream polyurethane segment due to consistent consumption of materials in the construction, automotive, and manufacturing sectors. The construction industry continued to perform strongly. According to the US Census Bureau, construction spending in May 2024 was projected at a seasonally adjusted annual rate of USD 2,139.8 billion, reflecting a slight decrease of 0.1% from the revised April estimate of USD 2,142.1 billion. It contributed to the firm consumption of polyurethane materials and its key component, Polyol. Simultaneously, in the automobile sector, total new-vehicle sales for July 2024, including retail and non-retail transactions, are projected to reach 1,340,500 units, a 2.8% increase compared to July 2023, according to a joint forecast from J.D. Power and GlobalData. This growth indicates sustained consumer demand and ongoing expansion in the automotive sector. At the same time, the Consumer Price Index for All Urban Consumers (CPI-U) decreased by 0.1% on a seasonally adjusted basis in June, following no change in May 2024. Consequently, the manufacturing rates were firm in the US, and at the end of the second quarter, the US Purchasing Manager’s Index rose from June 2024, indicating improvement in business conditions.

However, the Polyol supplies were insufficient to cater to the market demand, and the offtakes remained moderate from the market. At the same time, cost support improved due to the escalation in Polyol key feedstock propylene oxide prices. Hurricane Beryl, which struck the Gulf Coast on July 1, 2024, affected upstream propylene cracking, and disrupted operating rates at manufacturing units. Simultaneously, the export rates of Polyol were low to the importers during the month, and international buyers maintained low offtakes, which kept the market inventory levels stable to cater to the domestic demand.

According to the ChemAnalyst data sources, Polyether Polyol MW 3000, μ 400-650 FOB Texas prices in the USA witnessed USD 2160/MT, at the end of July 2024.

As per the expectations, Polyol prices in the North American region will rise around the middle of Q3 2024. This increase in Polyol prices is expected due to growing demand from the Polyurethane sector, driven by higher production costs associated with the rising prices of feedstock Propylene Oxide. Furthermore, Polyol procurement would be ramped up by buyers to ensure smooth operations at manufacturing units and to prevent supply delays caused by hurricanes during the wet season.