Zinc Oxide Prices Incline in Asia Amid Supply Constraints and Logistical Challenges
Zinc Oxide Prices Incline in Asia Amid Supply Constraints and Logistical Challenges

Zinc Oxide Prices Incline in Asia Amid Supply Constraints and Logistical Challenges

  • 16-Sep-2024 5:23 PM
  • Journalist: Xiang Hong

In August 2024, Zinc Oxide prices in the Asian market exhibited an upward trend. In India, prices rose by 2% due to supply constraints across the region, exacerbated by severe weather conditions and logistical challenges. Although feedstock Zinc metal prices saw a decline, driven by competitive pricing from Chinese manufacturers, Zinc Oxide prices continued to increase. This price rise was supported by steady demand from downstream industries, particularly the rubber, paints, and coatings sectors. However, the situation was complicated by port congestion and adverse weather, including typhoon Yagi during early September that caused heavy rainfall and disrupted construction activities throughout Asia. These disruptions led to reduced consumption of Zinc Oxide in the paints and coatings sector and impacted the rubber and tire industries due to a slowdown in the automotive sector.

In August 2024, the Asian Zinc Oxide market experienced a continued downward trend due to weak demand from the rubber and coatings industries, compounded by severe supply challenges. In China, a crucial market in the region, economic strain was intensified by a slowdown in factory activity and a prolonged real estate crisis. Heavy rainfall further disrupted production and transportation, significantly affecting the downstream construction sector. In India, the Zinc Oxide market also faced low demand, despite reduced costs for imported materials. Severe weather conditions at Kandla Port led to significant delays and hindered cargo operations, impacting container flows from the west coast ports. Additionally, torrential rain and flooding at Mundra Port exacerbated vessel delays and capacity constraints. These logistical issues, combined with low demand and constrained product availability, contributed to upward pressure on Zinc Oxide prices in the Indian market, keeping them relatively high despite the broader downward trend. Consequently, the price of Zinc Oxide (Rubber grade) Ex-Vadodara was quoted at USD 2565/MT this month, reflecting the complex interplay of supply constraints, demand dynamics, and regional challenges affecting the market.

Furthermore, export demand for Zinc Oxide from Vietnam remained low, primarily due to a slowdown in the automotive sector. Although Vietnam's automotive sector reported a 17.1% year-on-year increase in vehicle sales in July, demand in August remained subdued. This reflects ongoing market uncertainty and the persistent effects of disrupted supply chains. The situation was further aggravated by Typhoon Yagi, which exacerbated supply chain disruptions across Asia, particularly impacting southern China and Vietnam. The typhoon compounded logistical challenges, leading to significant delays and disruptions in the supply of Zinc Oxide. As a result, both domestic and export markets faced ongoing difficulties, contributing to the subdued demand, and affecting the overall market dynamics.

According to ChemAnalyst, the price trend for Zinc Oxide in Asia is expected to remain moderate in the coming month. The demand from the downstream rubber and coatings industries is anticipated to remain subdued, while supply constraints are likely to contribute to overall price stability. This balanced outlook reflects ongoing market dynamics and the anticipated stability despite current challenges.

Related News

Asian Zinc Oxide Market Shows Diverging Trends in November 2024
  • 13-Dec-2024 8:00 PM
  • Journalist: Alexander Hamilton
Zinc Oxide Prices Incline in Asia Amid Supply Constraints and Logistical Challenges
  • 16-Sep-2024 5:23 PM
  • Journalist: Xiang Hong
Univar Solutions Named Exclusive Distributor of VIZOR Zinc Oxide for Europe
  • 10-Jul-2024 3:32 PM
  • Journalist: Jacob Kutchner
Sandvik Receives Major Order from Hindustan Zinc for Underground Mining Equipment
  • 24-May-2024 2:19 PM
  • Journalist: Peter Schmidt