The prices of Formaldehyde remained stable in the last week of December 2024. The prices continued to witness stable trend in the past few weeks. The stability of the prices was witnessed due to various factors including raw material cost, production cost, economic factors and so on.

The stable prices of Formaldehyde were primarily driven by stable supply of raw material in the upstream market. The prices of Methanol remained stable in the market during the week ending on 27^th December 2024. The Methanol market in USA was impacted by the sale of Netherlands -based OCI’s methanol production assets to rival producer Methanex. The move affected the overall production of Methanol in the market. The production of Methanol is expected to remain robust in the USA market indicating robust raw material supply to the downstream production of chemicals like Formaldehyde. The acquisition is expected to remove the OCI from the US methanol market. The USA methanol market is under the looming issue of liquidity. Market participants expect the liquidity to remain unchanged until sometime after the deal is set in stone.

The Formaldehyde market is directly influenced by upstream methanol and natural gas market. Natural gas prices witnessed a surge due to colder season and increased demand in the market. On the demand side, the demand of Formaldehyde remained steady in the automotive sector despite increased new vehicle sales in the month of December as the sales were aided by increased discounts from automakers and dealers therefore Formaldehyde demand remained steady as production levels remained steady. The demand from another key downstream sector such as construction sector also remained unchanged reflecting the overall unchanged demand levels from key downstream sectors. With robust availability of raw material and steady production in the market, the prices of Formaldehyde didn’t witness any significant changes in the last week.

Looking further ahead, the demand from primary downstream sectors is anticipated to remain steady, which suggests that the prices of Formaldehyde are likely to exhibit minimal growth or remain relatively flat in the coming weeks. This trend reflects a balanced market dynamic for Formaldehyde, where both supply and demand are stable. However, any significant disruptions in the supply chain or changes in demand could potentially trigger an increase in prices, as these factors often have a direct impact on market conditions. Additionally, the cost of raw materials, particularly Methanol, is another key driver that may push prices upwards if there is a rise in its price. Given these factors, which suggest a stable to moderately growing demand, Formaldehyde prices are expected to experience little fluctuation and maintain a steady course soon. The combination of these influences’ points to a relatively predictable market environment, with minimal volatility in the short term.