Toluene Diisocyanate price movement continued to showcase a bearish trend in September 2023, and prices fell by almost 7% from August 2023. The suppliers decreased their quotations gradually during every week of the month. The previous inventories of Toluene Diisocyanate were adequately available, and no improvement in offtakes from the downstream Polyurethane segment was seen in the market. At the same time, increased imports of materials from Chinese exporters at lower costs as no production in the regional facilities resulted in arbitrage, and suppliers reduced the quotations in the domestic market to improve offtakes.

As per the sources, the high energy prices and interest rates and the decline in demand from buyers caused a slowdown in the Eurozone growth. Consequently, the Eurozone manufacturing Purchasing Manager’s Index decreased again during August 2023, like the past month, indicating further contractions in manufacturing sector activities. The Toluene Diisocyanate demand remained depressing from the downstream buyers amid weak inquiries from the Polyurethane segment due to no improvement in production activities in the manufacturing sector. Manufacturing activities remained low in the end-user Polyurethane segment during the regional summer holidays. It negatively impacted the consumption rates of buyers and raised the domestic inventory levels of Toluene Diisocyanate.

Simultaneously, in the US market, the price trend of Toluene Diisocyanate remained bearish and witnessed a fall of 3.6% during August 2023. As per the sources, the US manufacturing Purchasing Manager’s Index decreased sharply during August 2023, indicating contractions in manufacturing sector activities. Consequently, orders continued to remain depressing from the downstream buyers amid weak inquiries from the Polyurethane segment. In September, sellers again decreased their prices amid rising inflation to boost sales.

On the contrary, the noticeable increase in feedstock Toluene costs due to escalated production costs amid high upstream prices because of the decline in national Crude Oil inventories amid Oil production cuts by OPEC+ and Russia raised the production costs of Toluene Diisocyanate. Simultaneously, the supply chain activities were affected due to delayed shipping routes activities through the Panama Canal.

According to the ChemAnalyst database, the Toluene Diisocyanate prices in Germany and the US witnessed at USD 3350/MT and USD 2910/MT.

As per the estimation, the Toluene Diisocyanate market will remain bearish in the European and US markets, and suppliers will reduce their quotations again towards the end of quarter 3 of 2023. The supplies are adequately available in the regional market, while the demand for Toluene Diisocyanate is low from the Polyurethane sector. Furthermore, as per the sources, Saudi Arabia and Russia will further cut down their production by 1 million barrels per day and export to 300,000 barrels per day during Q4 2023, and upstream Toluene prices will remain volatile during Q4.