US MEA Triazine Prices Fall Amid Low Demand and Hurricane Disruptions, Winter Recovery Expected

In September 2024, the US Monoethanolamine Triazine (MEA Triazine) experienced a decline due to subdued demand from the downstream oil and gas refining sector. This decline in the prices of MEA Triazine was largely attributed to the ongoing hurricane season, which caused major facilities in the oil and gas sector to be offline, thereby reducing consumption of the product. Additionally, logistical challenges persisted, including a strike by US longshoremen that began in late September and ended in early October 2024. Although the strike concluded, long queues of ships remained at US East Coast ports, potentially taking weeks to clear. Reports indicated that at least 54 container ships were lined up outside the ports for three days due to the strike, which had prevented unloading and threatened shortages, including shipments of chemicals which may have led to the slow circulation of MEA Triazine.

Following the end of the strike, the International Longshoremen's Association (ILA) and the United States Maritime Alliance (USMX) announced an agreement, which included a wage increase of approximately 62% over six years, raising average wages from $39 to about $63 an hour. This wage hike is expected to impact MEA Triazine prices in the domestic market.

Despite the strike resolution, the MEA Triazine market faced downward pressure from low demand conditions, as refinery run rates in the US decreased. Data from the EIA showed that weekly utilization rates of refineries dropped from 92.8% for the week ending September 6 to 92.1% by September 13, then further down to 90.9% for the week ending September 20, ultimately settling at a low of 87.6% by September 27, 2024. This decline in utilization rates contributed to weakened demand for MEA Triazine. Additionally, production of refined products, such as finished motor gasoline, fell from an average of 1,374 thousand barrels in August 2024 to 1,343 thousand barrels in September 2024 further corroborating to the low demand of MEA Triazine.

Looking ahead, data from the EIA indicated that Hurricane Milton is projected to make landfall on the west coast of Florida later in the second half of October 2024 as a major hurricane with sustained winds of 160 miles per hour, potentially causing significant disruptions to energy infrastructure which may further reduce the demand for MEA Triazine. The U.S. Coast Guard reported several ports in Florida are closed, and vessel traffic to Port Tampa Bay has ceased. This port typically handles over 17 million tons of petroleum- and natural gas-related products annually, with more than 43% of Florida's petroleum products—such as gasoline, diesel, and jet fuel for major airports—passing through it creating further uncertainties in the consumption of MEA Triazine. The duration of the port closures and the impacts of Hurricane Milton on petroleum and natural gas trade movements remain uncertain. Additionally, reports indicated that Chevron closed its Blind Faith oil platform in the U.S. Gulf of Mexico and evacuated all personnel in preparation for the hurricane, which is also expected to negatively impact the production of petrochemical products where MEA Triazine finds its prime application as Hydrogen Sulphide remover.

However, in the upcoming month demand for MEA Triazine is expected to increase as the winter months in late 2024 is expected to increase the demand for residential, heating oil, petrol, diesel and gasoline, leading to increments in the prices of the product.