For the Quarter Ending December 2024
North America
In Q4 2024, the U.S. Benzoic Acid market faced dynamic price fluctuations shaped by varied market forces. October saw a significant price surge driven by seasonal demand, rising raw material costs, supply chain disruptions, and increased shipping expenses from Asian suppliers. Strategic stockpiling and global supply disruptions, particularly in Ukraine and the Middle East, further exacerbated the upward pricing trend. However, manufacturing challenges, including supply bottlenecks and workforce issues, restrained production efficiency.
November marked a shift as Benzoic Acid prices declined due to inventory reductions, competitive supplier pricing, and stable downstream demand. Improved supply chain conditions and proactive front-loading of cargo eased market pressures. Yet, looming uncertainties over tariff negotiations and cautious end-user purchasing limited growth.
By December, weak demand from pharmaceuticals and robust competition from Chinese imports drove further price reductions. Elevated inventories and destocking efforts intensified competition. Despite stable production levels and export activity, subdued new orders and manufacturing contractions signaled ongoing market pessimism. While employment rose, policy uncertainty and input cost inflation weighed heavily on the sector.
Asia Pacific
The Benzoic Acid market in China faced significant volatility throughout Q4 2024. In October, prices surged due to supply constraints caused by typhoon-induced shipping delays, strong pre-holiday procurement, and growing demand from the pharmaceutical sector. A weakening dollar against the yuan elevated import costs but boosted traders' margins. Despite challenges, China's manufacturing PMI rose to 50.1, signaling recovery supported by government stimulus, though export orders and employment remained weak.
November saw a subtle price decline as strategic destocking and falling raw material (toluene) costs pressured suppliers to lower prices. The manufacturing PMI climbed to 50.3, indicating resilience, but weaker exports and declining imports underscored demand challenges. Buyers capitalized on lower prices, adopting cautious procurement strategies.
In December, the market faced continued downward pressure. Manufacturing PMI dipped to 50.1, reflecting stagnant domestic demand, weak foreign orders, and subdued confidence. Falling input costs and cautious inventory management compounded the bearish sentiment. Persistent weak demand and limited economic recovery suggest ongoing price pressures for Benzoic Acid and its downstream sectors. The quarter concluded with prices at USD 1,010 per metric ton (MT) of Benzoic Acid, FOB Shanghai showcasing average quarterly decline of 0.33%, underscoring the overall negative pricing environment pervasive throughout the APAC region.
Europe
In Q4 2024, the Netherlands, a key producer and exporter of Benzoic Acid, experienced fluctuating market conditions shaped by global economic challenges and supply chain disruptions. Initially, Benzoic Acid prices surged due to constrained supply, rising input costs, and shifting demand patterns. Exporters capitalized on limited inventories and arbitrage opportunities to adjust domestic pricing, while elevated import costs further strained sectors like pharmaceuticals.
However, by November, weakening demand and lower production costs reversed the trend, driving prices down. Oversupply from pre-holiday stockpiling compounded bearish market sentiment, with suppliers focusing on inventory normalization.
The broader Dutch manufacturing sector faced its most challenging period of the year, as reflected in the NEVI Manufacturing PMI, which dropped from 47.0 in October to 46.6 in November. Shrinking new orders, sharp declines in export demand, and rising input costs intensified financial pressures. Despite modest optimism for 2025, firms scaled back growth ambitions. Meanwhile, the European Toluene market grappled with falling crude oil prices and weak industrial demand, highlighting persistent challenges in balancing supply and demand dynamics across key markets.
For the Quarter Ending September 2024
North America
Throughout Q3 2024, the North American Benzoic Acid market experienced a steady decline in prices, driven primarily by persistent oversupply and weakened demand dynamics. An imbalance between supply and demand was evident, with a surplus of Benzoic Acid leading to sluggish consumption from downstream industries. Factors such as reduced demand from neighboring regions, subdued trading environments, and overall weak international demand contributed to this downward price trend.
Manufacturers responded to the diminished demand by scaling back production levels, resulting in the first contraction in supplier lead times in three months. End-users adopted a cautious purchasing strategy, focusing on need-based buying rather than proactive inventory replenishment. This approach further dampened market activity and interest, exacerbating the weak demand environment.
In the USA, which saw the most significant price fluctuations, the quarter experienced a notable 6% decrease from the previous quarter. While the first half of the quarter reflected a slight decline of 1%, the quarter-ending price settled at $1,310/MT CFR New York. This figure underscores the negative pricing trend that permeated throughout Q3 2024. Fortunately, no significant disruptions or plant shutdowns were reported during this period, indicating that supply chains remained stable despite the prevailing challenges. The overall market outlook for Benzoic Acid in North America remains weak, with ongoing oversupply conditions continuing to shape the pricing environment.
Asia Pacific
In Q3 2024, the APAC region faced a challenging landscape for Benzoic Acid pricing, characterized by a notable and persistent decline in market values. This downturn can be attributed to several interconnected factors. Primarily, decreased industrial output across various sectors resulted in diminished demand, leading to an oversupply situation. This oversupply, coupled with weakened demand, exerted considerable downward pressure on prices.
The ongoing depreciation of local currencies against major global currencies further compounded these challenges, making imports more expensive and dampening market sentiment. Rising raw material costs, particularly for Toluene, significantly increased production expenses, squeezing manufacturers' margins and ultimately leading to reduced profitability. Compounding these issues, the quarter also experienced disruptions, including unexpected plant shutdowns that affected supply dynamics and further contributed to price volatility.
China emerged as a focal point for these price changes, experiencing a -2% decrease in Benzoic Acid prices from the previous quarter, with an even steeper -9% decline when comparing the first half to the latter half of Q3. The quarter concluded with prices at USD 1,020 per metric ton (MT) of Benzoic Acid, FOB Shanghai, underscoring the overall negative pricing environment pervasive throughout the APAC region.
Europe
In Q3 2024, the European region experienced a significant decline in Benzoic Acid pricing, primarily driven by a confluence of market factors. A notable reduction in demand from downstream sectors, particularly in the food and beverage and pharmaceutical industries, contributed to this downward pricing trend. This decrease was exacerbated by broader global economic challenges, including inflationary pressures and currency fluctuations that affected purchasing power.
High inventory levels also played a critical role in suppressing prices, as suppliers sought to offload excess stock amid weaker demand. Additionally, supply chain disruptions, particularly those stemming from geopolitical tensions and logistical bottlenecks, created an unstable market environment. Fluctuating raw material costs further complicated pricing strategies for manufacturers, who faced increased costs for essential inputs.
Within Europe, the Netherlands experienced the most pronounced price fluctuations, which mirrored the overall regional trends. Throughout Q3, prices reflected a negative correlation, showing a 1% decrease from the previous quarter. Comparisons between the first and second halves of the quarter indicated a cumulative price decline of 2%. Market dynamics were also affected by production disruptions, including plant shutdowns, culminating in a quarter-ending price for Benzoic Acid (Tech. Grade) FOB Rotterdam of USD 1,375/MT. This figure underscores a stable to negative pricing environment prevailing throughout Q3 2024.
For the Quarter Ending June 2024
North America
In Q2 2024, the North American Benzoic acid market saw significant price increases due to various factors impacting supply and demand dynamics. In April, however, the United States experienced a notable drop in Benzoic acid prices, mirroring a similar trend in Chinese provinces. This was primarily due to the U.S.'s role as a major importer. The easing of geopolitical tensions led to reduced freight charges, which lowered shipment costs and Benzoic acid prices in the U.S. Additionally, substantial existing inventories from bulk purchases in anticipation of higher demand contributed to a subdued market. This surplus, combined with decreased purchasing activities and weakened consumer confidence due to inflation, further dampened demand.
Supply dynamics also played a critical role, with the appreciation of the U.S. dollar exacerbating the downward trend in prices, challenging producers and suppliers. Global supply chain disruptions, ongoing geopolitical tensions, and logistical challenges such as drought-induced bottlenecks and prolonged vessel delays also influenced the market. The General Rate Increase (GRI) imposed by shipping carriers further raised costs, leading to heightened procurement activities as industry participants adopted bulk buying strategies to mitigate future supply uncertainties and capitalize on existing arbitrage opportunities.
In the U.S., the most significant price changes occurred due to the early onset of the peak shipping season, robust local purchasing, and strong downstream demand. Seasonal factors, like the anticipated higher demand during summer, amplified price increases. By the end of Q2, the price of Benzoic acid in the U.S. settled at USD 1265/MT CFR New York, reflecting a consistent upward trajectory and a 0.18% average quarterly increase.
Asia Pacific
In Q2 2024, the Benzoic Acid market in the APAC region experienced a significant upward pricing trend. Strong demand surpassing limited supply, intensified by domestic and international market pressures, was the primary driver. Traders responded to the high demand by purchasing at elevated prices. Geopolitical tensions and rising input costs, particularly energy, further escalated production expenses, impacting end-product prices. Additionally, increased freight costs due to soaring crude oil prices strained the market, raising import costs.
China saw the most substantial price changes, facing severe supply challenges from low inventories and heightened international demand. The post-Lunar New Year period usually marks a rebound in production, but this year it struggled to meet the growing demand. A Force Majeure shutdown at the Hubei Kelin Bolun New Materials Co., Ltd plant in Zhijiang City in June, due to a heavy rainstorm, exacerbated supply constraints and contributed to rising prices.
Despite these pressures, prices decreased at the beginning of Q2. In April, the Chinese market observed a significant downturn in Benzoic Acid prices, influenced by an abundance of domestic inventories. This surplus led market players to lower prices to destock and create space for replenishment. The appreciation of the US dollar supported this trend, resulting in an average quarterly price increase of 0.34% in the second quarter. By the end of Q2 2024, the Benzoic Acid market in China concluded with a quarter-ending price of USD 1110/MT FOB Shanghai.
Europe
In Q2 2024, the European Benzoic Acid market experienced a significant price increase driven by rising production costs, geopolitical disruptions, and supply chain constraints. Germany, a major importer, saw a notable price decrease in April, reflecting a broader downturn in exporting regions. This decline was due to substantial inventories from prior bulk purchases, leading to oversupply and dampening market sentiment. Reduced purchasing activities and weakened consumer confidence, exacerbated by inflation, further suppressed demand.
The easing of geopolitical tensions reduced freight charges, impacting transportation costs and overall pricing in the German market. Supply dynamics also influenced the pricing landscape, with the US Dollar's appreciation against the Euro adding challenges for producers and suppliers. Escalating feedstock prices, particularly for Toluene, significantly increased production costs. Logistical disruptions from the Panama Canal drought and reduced vessel traffic exacerbated supply issues, creating bottlenecks and market strain. The ongoing conflict in Israel and Gaza caused sporadic shipping delays, particularly affecting routes through the Red Sea and Cape of Good Hope, intensifying market volatility.
Germany faced a confluence of factors, including a weakened Euro and heightened inflationary pressures, driving prices upward. Seasonal demand fluctuations led to increased procurement activities early in the quarter, with an average quarterly price increase of 0.18%. By the end of Q2 2024, the Benzoic Acid market in Germany concluded with a quarter-ending price of USD 1230/MT CFR Hamburg, indicating a stable yet positive pricing sentiment amidst ongoing economic and geopolitical challenges.
For the Quarter Ending March 2024
North America
In Q1 2024, the pricing environment for Benzoic acid in North America was characterized by fluctuations and significant price increases. The latest quarter-ending price for Benzoic acid in the US was USD 1260/MT CFR New York, showing an average quarterly increase of 2.90%.
The USA experienced rising prices due to various factors: production slowdowns, maintenance shutdowns, export restrictions, increased freight charges, and low inventories. Dependence on Chinese imports worsened due to disruptions in Chinese provinces during Lunar New Year, constraining supplies and raising prices. Post-Lunar New Year, global demand for Benzoic acid surged, influenced by geopolitical tensions, trade disruptions, and increased container freight rates, causing another price hike in March. The US, a major importer, felt these effects, adjusting prices to remain competitive amid limited inventories and delayed supplies from exporting regions. Concerns over potential disruptions in the Mississippi River due to weather further intensified inquiries and pushed prices up.
The price of raw material, Toluene, also contributed to the hike. Despite a slight decrease at the start of Q1, the Benzoic acid market eventually saw falling prices and unified sentiment, partly due to strategic actions by the USA influencing global prices. Factors like reduced raw material costs and declining manufacturing activity in the USA led to lower prices as downstream enterprises adjusted procurement strategies.
Asia Pacific
In the first quarter of 2024, the pricing of Benzoic acid in the Asia-Pacific (APAC) region remained mostly stable, with some fluctuations in specific countries. In conclusion, the latest quarter-ending price for Benzoic acid in China was USD 1100/MT FOB Shanghai with an average quarterly incline of 1.36%. The demand for Benzoic acid from industries like pharmaceuticals and food processing stayed consistent, supporting prices and maintaining a positive market sentiment. In February 2024, prices increased due to higher demand and low inventories, exacerbated by production slowdowns during the Chinese Lunar New Year and Spring Festival. Rising freight costs and logistical challenges further reduced availability.
After the holidays, there was a surge in purchasing both domestically and internationally, driven by consumer confidence and favorable sentiment, with traders benefiting from the Chinese currency depreciation against the USD. Suppliers adjusted prices to match heightened demand, and traders secured bulk orders in anticipation of shortages. Additionally, the increase in raw material Toluene prices also contributed to the rise in Benzoic acid prices. In March, sustained demand from Chinese end-users led to higher Toluene prices, prompting increased production. When the market reopened after the holidays, prices surged due to the production ramp-up to meet domestic demand.
The pricing trends for Benzoic acid in the APAC region in the first quarter of 2024 were generally stable, although prices did decrease at the start of the quarter. This drop was influenced by year-end destocking activities from the previous month, which had a notable impact on market dynamics. Additionally, weakened demand downstream and sufficient inventories put pressure on Benzoic acid pricing. In the Chinese market specifically, Toluene prices also saw a decline due to weak demand.
Europe
In Q1 2024, the pricing environment for Benzoic acid in Europe saw a notable positive trend with increasing prices. By the quarter's end, the latest price for Benzoic acid CFR Hamburg in Germany was recorded at USD 1225/MT CFR Hamburg with an average quarterly incline of 1.02%, reflecting market conditions and challenges in procurement and delivery.
Several factors drove these shifts, including heightened demand from downstream sectors, supply chain disruptions, and currency exchange rate fluctuations. Germany's market, heavily impacted by the Euro's depreciation against the dollar and shortages in exporting nations, experienced shipment delays and extended lead times for Benzoic acid availability. Geopolitical tensions and trade interruptions added further complexity, influencing overall market sentiment. Rising container freight rates, especially affecting maritime transport-dependent industries, significantly contributed to price surges.
As a key importing hub, Germany's pricing closely correlated with major exporting countries, with currency devaluation amplifying challenges for traders and buyers facing higher USD-denominated import costs alongside increased raw material prices, notably for Toluene. The temporary halt in mass production during China's Lunar New Year and Spring Festival exacerbated the situation, leading to heightened post-holiday order volumes and subsequent price spikes in predicting regions.
