During the first week of October 2024, the global Diacetone Alcohol (DAA) market remained stagnant, with stable prices despite fluctuating demand from the construction sector. This price stability is largely due to traders’ effective management of inventory and supply levels. The construction industry, a primary consumer of DAA, is experiencing mixed demand due to seasonal changes and economic uncertainties. While some areas are seeing increased construction activities, others are hindered by supply chain disruptions and labor shortages. Overall, traders have successfully navigated these challenges to maintain consistent pricing in a dynamic market environment.

In the North American market, the price of DAA exhibited a phase of stagnation. This price stability can be primarily attributed to a closely matched gap between demand and supply dynamics in the market. On the supply side, there has been notable stability in domestically produced DAA, indicating that production levels are sufficient to meet current demand. However, inquiries for DAA in the North American market have remained modest, reflecting the subdued performance of the key end-user construction sector. According to various reports, U.S. private payrolls saw a noteworthy increase of 143,000 jobs in September, surpassing expectations and further reinforcing the stability of the labor market. This growth was primarily driven by hiring activities in critical sectors such as construction, leisure, and hospitality. Specifically, construction employment expanded by 26,000 jobs, reflecting increased activity and investment in infrastructure projects, which are known to utilize DAA in various applications. Additionally, the leisure and hospitality sector contributed significantly, adding 34,000 jobs, indicating a resurgence in consumer spending and travel-related activities. These trends are vital as they not only enhance overall economic stability but also drive demand for related chemical products like DAA, which are integral to various manufacturing processes.

In the European market, Insights from various market participants indicate that the economic outlook in the EU and eurozone was stable throughout September. This stability was characterized by a rise in construction activity and heightened consumer confidence, which collectively counterbalanced a decline in industrial confidence. According to official data released on Friday, the European Commission’s Economic Sentiment Indicator (ESI) remained flat at 96.7 points in the EU, while it dipped slightly by 0.3 points in the eurozone to reach 96.2 points. The steadiness of the ESI reflects improved confidence levels in the construction sector and among consumers, indicating positive sentiment regarding economic conditions. However, this was offset by a reduction in confidence within the industrial sector, which may contribute to a cautious outlook for future industrial demand for DAA. Overall, while the DAA market experienced price stagnation amid fluctuating feedstock costs and a stable economic environment, the mixed signals from the broader economic indicators underscore a degree of caution among market participants.

The prices of DAA are anticipated to increase in the coming weeks amidst expected surge in construction activities due to forthcoming festivities and rise in Crude Oil prices.