In the first half of August 2024, the US Cellulose Ether market experienced stability, with a largely maintained balance between supply and demand. Production levels of Cellulose Ether were moderate due to the limited availability of feedstock Propylene Oxide, which led to a nearly 1% increase in prices and subsequently raised production costs.

The restricted supply of Propylene Oxide was due to an unplanned shutdown at Nova Chemicals in late July 2024, affecting the availability of this crucial feedstock for Cellulose Ether production. Additionally, the supply of feedstock Cellulose was also constrained. This was caused by a labour dispute in Canada, where the two largest railroads, Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC), locked out over 9,000 workers after failing to reach new labour agreements with the Teamsters Canada Rail Conference (TCRC). This work stoppage is expected to significantly impact Canada's forest product exports—a sector valued at C$45.5 billion in 2023, according to Statistics Canada. CN, the largest North American rail carrier of forest products, depends heavily on transporting lumber, pulp, and paper products, with over 10% of its revenue linked to the housing market. The labour dispute threatens to disrupt the supply chain, worsening the supply issues in both Canada and the US which is expected to further affect circulation of Cellulose Ether. As a result, companies in the forest sector are feeling the strain. For instance, pulp producer Mercer International has begun contingency planning, including alternative transportation methods, while Conifex Timber has scaled back operations at its Mackenzie, British Columbia sawmill due to uncertainties surrounding rail transport. These factors contributed to the moderate production of Cellulose Ether.

Despite these supply challenges, demand for Cellulose Ether remained weak. The coating sector's activity was subdued, reflecting the moderate performance of the US construction industry. The construction sector showed steady but modest demand, although market conditions were pressured by a recent drop in housing permits indicating unfavourable demand conditions of Cellulose Ether. In July, housing permits fell by 4% from June and 7% compared to the same month last year, according to data from the US Census Bureau. Single-family housing starts declined by 14% from the previous month and 15% year-on-year. In contrast, multifamily starts increased by 12% from June but were down 24% compared to the previous year. Single-family housing permits also decreased by 0.1% from June, marking the sixth consecutive month of declines, which continued to affect Cellulose Ether consumption and contributed to market balance.

Looking ahead, Cellulose Ether prices in the US market are anticipated to depreciate in the coming weeks. This is due to ongoing low demand conditions exacerbated by the monsoon season in the US and current economic uncertainties, which are expected to reduce significant transactions in the secondary downstream FMCG sector, further weakening demand conditions of Cellulose Ether.