Texas (USA): Hexene prices stabilize in the USA after a strong deceleration owing to oversupply, elevated intermediate inventories held by downstream suppliers, and downward pressure on feedstock prices. While Hexene prices stabilize, an uptick in downstream HDPE prices has been observed since the beginning of FY24. Demand sentiments, though remaining weak, continue to be higher than in FY23, with the mortgage crisis subsiding to a significant extent. While price recovery remains a distant projection, demand recovery is certain in the US, with spread margin degradation in Q4 being offset by higher volumes. As FY24 progresses, Hexene prices are set to stabilize and rise to a significant extent again with demand recovery and improvement in the sustainability transition situation across the globe.

In US markets, Hexene FOB Texas declined by 4% in the month of February due to weak global demand and the falling price point of ethylene prices. Ethylene prices rallied largely owing to inventory pressure and export demand sentiment. Integrated PE Units continue to operate with their capacity utilization hitting 85% to meet export demand from China and East Asian countries. A recent spike in mortgage rates due to the US Federal Reserve's neutral stance has further disrupted the Hexene business, with suppliers expecting destocking after the Chinese market reopens. US Hexene supplies continue to dominate European markets due to price competitiveness and feedstock availability. The sustainability transition and demand for energy-efficient homes in Europe continue to drive the construction and refurbishment industry. US natural gas consumption fell by 2% in the previous week, with ethylene prices remaining relatively unchanged, to be reflected in prices in the coming week. The downstream automotive industry, especially the EV section, currently faces a demand slump primarily as the US's largest EV supplier, Tesla, has recalled all its US vehicles for technical glitches, pushing procurement and supply of newer cars to the next quarter. A similar situation is being observed in Japan, which is pulling down US Hexene and PE exports at the current market situation.

European markets, on the other hand, observe stable pricing due to fluctuating deliveries and lower demand sentiment. Supplies of Hexene from Saudi Arabia to the Hamburg port are currently taking 30-40 days longer in transit times. In FY24, multiple governments in Europe have reduced subsidies for sustainable housing and refurbishment, which is reflected in the newer order books of Hexene/ethylene copolymer demand in Europe. The slowing EV segment remains another issue for Hexene demand in Europe, offsetting price rises. Analyzing prices, European supply at Hamburg is largely through East Asian and Mediterranean supply, with freight charges continuing to remain elevated. With the 'Superbonus' in Italy reduced and German subsidies for transitioning to 'heat pump' and other measures by the government to reduce debts in FY24 to control the inflationary trend, petrochemical prices, especially of Hexene, are anticipated to remain subdued further, and recovery in the petrochemical segment is expected to be pushed to FY25, as agreed upon by CEFIC. ChemAnalyst's forecast of Hexene having a marginal uptick in prices due to supply disruptions, US demand recovery offset by a weak EU market, remains unchanged.