In March 2025, the Methylene Diphenyl Diisocyanate (MDI) prices witnessed an increase in the North American region. MDI production in the U.S. improved in March after being impacted by the Arctic blast. Meanwhile, the U.S. Department of Commerce started an antidumping investigation into MDI imports from China, which could lead to supply shortage in the region. However, the demand for MDI from the Polyurethane industry remains steady, but higher costs for feedstock, freight, and production are expected to push MDI prices up in the coming weeks. Tariffs, trade tensions, and supply chain issues continue to affect the market, while the construction sector faces challenges like higher home building costs and labor shortages.

The previous availability of stocks was low in the market as production was hampered due to the arctic blast in the region. However, in March, MDI production rates improved, and cost support eased due to decreases in feedstock Benzene prices during the month. The ease in upstream Crude Oil prices attributed to stabilized demand from buyers with increasing temperature and declining buyer's confidence amid imposed tariff rates negatively impacted Benzene's production costs. However, tariff-related trade issues affected shipping and logistics activities, which impacted the MDI supplies to the buyers. 

While tariffs against China were already in effect, on March 5, 2025, the U.S. Department of Commerce announced an antidumping duty (AD) investigation into MDI imports from China. The investigation will check if MDI from China is being sold at unfairly low prices in the U.S. and harming the U.S. manufacturers. The commission believes there is enough evidence that U.S. industries are being affected by these low prices. This investigation is part of efforts to ensure fair trade and protect U.S. industries from unfair competition. A preliminary decision on antidumping duties is expected by July 22, 2025. 

Despite the challenges, the demand for MDI, used in making Polyurethane (PU) materials, stayed steady but cautious in the U.S. automotive and construction industries. The automotive market showed a slight recovery, with more vehicles and electric vehicles (EVs) sold, which helps long-term MDI demand from the PU industry. However, trade tensions and tariffs created challenges. In the construction sector, higher home building costs and labor shortages limited growth. Despite these issues, overall construction spending is expected to increase by 5.5% in 2025, with different results in the commercial and residential sectors affecting MDI demand in the Polyurethane segment.

MDI prices in the U.S. are expected to increase in the coming weeks of Q2 due to several factors. Demand from the Polyurethane industries is likely to rise, which will push prices. Input prices are also expected to go up, leading to higher production costs. Increased shipping activity and better trade conditions during the summer could result in higher freight costs, further driving up prices. Additionally, higher feedstock Aniline costs will add pressure and will raise the MDI prices even higher.