Ethylene Carbonate prices in the U.S. continue to face downward pressure entering December, following a trend observed in the latter half of November. The decline is largely attributed to subdued demand from downstream manufacturers, especially in the lithium-ion battery sector, which has been grappling with slowing electric vehicle sales and inventory challenges. 

Recent figures indicate that U.S. EV sales showed growth, reflecting steady increase. However, the pace of growth is notably slower compared to earlier in the year, as higher interest rates and reduced federal subsidies have tempered consumer enthusiasm and this slowdown has directly impacted demand for battery-grade Ethylene Carbonate,

The U.S. production costs for Ethylene Carbonate have remained stable. The stabilization of feedstock ethylene oxide (EO) prices in the U.S. following a decline is linked to various balancing elements. Although ethylene prices had declined in the previous weeks, the lack of substantial disruptions in production or major shifts in market demand enabled prices to stabilize. The main reasons for the price stagnation are a well-sustained market and consistent EO production, which maintained market balance even with reduced feedstock costs.

Operating rates at domestic Ethylene Carbonate manufacturing facilities are reported at around 70-75%, reflecting cautious production adjustments in response to the tepid demand. While production levels have not seen significant cuts, manufacturers of Ethylene Carbonate are hesitant to ramp up capacity utilization further, given the weak downstream activity. Export markets, which often provide relief during periods of domestic demand softness, have also offered limited support to Ethylene Carbonate market. Overseas demand for U.S.-made Ethylene Carbonate has declined, particularly in Asia and Europe, as these regions face their own economic challenges and reduced EV sales growth. 

Another contributing factor is the relatively high inventory levels of Ethylene Carbonate held by manufacturers and distributors, stemming from strong production earlier in the year. These stockpiles have increased market competition, driving prices down further. Despite the challenges, some industry analysts foresee potential stabilization in the Ethylene Carbonate market by early 2025, citing improving EV adoption rates in emerging markets and technological advancements in battery production.

Apart from this, declining raw material prices and broader economic trends have driven cell costs to record lows. However, this scenario is unsustainable, as many upstream suppliers, including miners, refiners, and producers, face significant challenges in maintaining or expanding their operations. As raw material prices are anticipated to rise, it is crucial that they stabilize at levels that sustain upstream supply while also supporting downstream profitability for OEMs.

According to the analysts, as the year-end approaches, many market players are anticipating intensified destocking activities, which could further pressurize prices of Ethylene Carbonate. Buyers are expected to leverage low-price opportunities, while sellers may adjust rates to manage stock levels and cash flows before the holiday season.