For the Quarter Ending December 2024
North America
The North American Cellulose Ether market experienced a mostly bearish trend during Q4 2024. Prices initially rose by approximately 0.5% but later declined by around 1%, reflecting the shifting market dynamics.
Mid-quarter, disruptions were observed due to a shortage of raw material cellulose imported from Canada, which drove up production costs for Cellulose Ether. Additionally, prices for feedstock Propylene Oxide saw moderate increases as a result of reduced production of Propylene during the hurricane season, which persisted until November 2024. These factors momentarily supported prices in the market.
However, the market eventually returned to its bearish momentum as ample supplies began to dominate. Export conditions remained largely unfavorable due to the strike by the International Longshoremen's Association (ILA) and the United States Maritime Alliance (USMX), which caused an estimated 10-17% loss in capacity at key ports, including the Port of Houston.
Toward the end of 2024, concerns over a potential new strike in early 2025 prompted suppliers to move inventories in bulk, aiming to mitigate potential disruptions. This led to an oversupply situation, as warehouses were cleared in anticipation of inventory devaluation and end-of-year tax repercussions. The resultant oversupply, coupled with subdued demand conditions, drove prices downward.
The bearish market sentiment was further exacerbated by the lackluster performance of downstream industries, which faced logistical bottlenecks and reduced operational rates. These factors collectively contributed to the depreciation of Cellulose Ether prices in the North American market as the year drew to a close.
Europe
The European Cellulose Ether market exhibited fluctuating price trends during Q4 2024. Prices initially declined by approximately 4%, then rose by about 2%, only to fall again by roughly 3% later in the quarter. Despite these fluctuations, the market sentiment remained predominantly bearish throughout the period, with November 2024 witnessing most of the price variations as some suppliers attempted to revise prices upwards due to variable inventory levels.
However, supplies across the market remained ample for most of the quarter, with liquidation of inventories being a common trend. The overarching fundamentals continued to exert downward pressure on the market, as suppliers tried to mitigate bearish conditions by reducing production rates. Despite these efforts, the strategy proved largely ineffective, as export conditions remained unfavorable.
Demand conditions remained weak, particularly from the downstream construction sector, which continued to struggle throughout the quarter. Minimal construction activities further dampened offtake volumes, contributing to the bearish market situation. Arbitrage opportunities remained closed for trade into and out of Europe, resulting in abundant supplies across the region.
Inland trading activities across Europe were also limited due to adverse weather conditions and reduced operational efficiencies at major European ports. Key ports faced challenges such as congestion and weather-related disruptions, which hindered smooth logistics and further restricted the movement of Cellulose Ether across the market.
As a result, the European Cellulose Ether market concluded the quarter with ample supplies and continued bearish sentiment, driven by subdued demand and logistical bottlenecks that prevented any significant recovery.
APAC
The Chinese Cellulose Ether market was reported to have experienced a predominantly bullish trend during Q4 2024, with prices initially declining by approximately 1% but later rebounding by around 2.5% in the last two months of the quarter.
The initial bearish sentiment in the market was attributed to weak demand from downstream coating industries, as the economic stimulus packages announced by Chinese authorities had largely underperformed, resulting in limited market activity. Demand conditions remained mostly unfavorable at the beginning of the quarter, with suppliers reporting minimal procurement activity despite some positive sentiment due to the anticipation of economic stimulus measures materializing later.
As the quarter progressed, the market shifted toward a bullish trend. Suppliers began reporting higher production costs for Cellulose Ether, primarily driven by increments in the prices of raw material cellulose. Many suppliers noted significant increases in quotations, with prices rising by over Yuan 100/MT, and in some cases, upward revisions ranged between Yuan 100/MT and Yuan 200/MT above existing levels.
Additionally, supply shortages were observed in the market during the latter weeks of the quarter. This was attributed to a significant number of production facilities undergoing maintenance turnarounds, which constrained output levels. These factors collectively contributed to the bullish sentiment in the market as suppliers struggled to meet rising costs and limited availability.
The combination of higher production costs, reduced supply due to maintenance shutdowns, and expectations of improving demand supported the upward momentum in the Chinese Cellulose Ether market, ending the quarter on a more optimistic note.
For the Quarter Ending September 2024
North America
In Q3 2024, the North American region faced significant challenges in Cellulose Ether pricing, resulting in a notable decline in market prices. Several factors contributed to this downturn, including weak demand from key sectors like construction and coatings amid ongoing economic uncertainties. Supply chain disruptions, including plant shutdowns and reduced production capacities, also affected pricing dynamics. Overall, market sentiment remained negative, with prices consistently trending downward.
In August 2024, production encountered additional hurdles due to limited availability of propylene oxide following an unplanned shutdown at Nova Chemicals in late July, which caused a nearly 1% increase in prices and raised production costs. Moreover, a labor dispute in Canada involving Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC) led to the lockout of over 9,000 workers, further constraining the supply of cellulose feedstock and resulting in moderate Cellulose Ether production across the U.S.
In the United States, prices experienced the most significant fluctuations, dropping by 14% compared to the same quarter last year. A quarter-on-quarter decrease of 1% highlighted ongoing pricing pressures, while a 3% drop from the first half to the second half of the quarter indicated a deteriorating pricing environment as the quarter progressed. By the end of the quarter, the price of Cellulose Ether (CMC) reached USD 3,830/MT FOB Texas, reflecting the prevailing downward trend in pricing and the challenging market conditions affecting demand across the region.
APAC
In Q3 2024, the Cellulose Ether market in the APAC region experienced a period of declining prices, with notable impacts on the market dynamics. Several factors influenced this trend, including subdued demand from various industries, particularly the construction sector, which faced liquidity challenges. Additionally, seasonal factors like the monsoon season dampened construction activities, further reducing the need for Cellulose Ether. These conditions led to a decrease in prices, with China seeing the most significant fluctuations. China, being a key player in the market, experienced a -13% price change from the same quarter last year, indicative of the prolonged downward trend. Within Q3 2024, there was a -5% change from the previous quarter and a -2% decline between the first and second halves of the quarter. The latest recorded price for Cellulose Ether HEC(80000-100000) Grade FOB Qingdao in China stood at USD 4700/MT, reflecting the overall negative pricing environment characterized by stability. These trends underscore the challenging market conditions and the persistent struggle with low demand and pricing pressures in the Cellulose Ether sector.
Europe
In the Europe region during Q3 2024, the Cellulose Ether pricing landscape witnessed a period of declining prices, heavily influenced by multiple factors. The market for Cellulose Ether experienced a challenging quarter, with significant price decreases driven by weak demand conditions and reduced production costs. The downturn in the construction sector played a pivotal role, leading to low demand for the product. Additionally, the stability in prices can be attributed to moderate supplies and limited availability of feedstock Propylene Oxide. Across the region, the overall trend indicated a bearish sentiment, with prices decreasing by 2% compared to the same quarter last year. Germany saw the most significant price changes, with prices dropping by 4% between the first and second half of the quarter. The market in Germany reflected a negative sentiment, with prices ending the quarter at USD 3760/MT of Cellulose Ether (CMC) FOB Hamburg. The correlation in price changes highlighted a stable to bearish market situation, with demand remaining low and suppliers maintaining low inventories. The quarter concluded with a clear indication of decreasing prices, aligning with the overall negative pricing environment seen throughout the period.
For the Quarter Ending June 2024
North America
In Q2 2024, the North American Cellulose Ether market maintained stable pricing amidst a combination of factors that fostered a balanced environment. Stable production costs, with minimal fluctuations in feedstock Propylene Oxide prices, played a crucial role in steadying Cellulose Ether prices. Adequate supply levels also contributed significantly, ensuring prices remained steady without significant swings. Moderate demand from downstream sectors like coatings and construction, reflecting a slowdown in construction spending, further bolstered this stability. Within the USA, where the most significant price variations were observed, the overall trend remained steady despite seasonal influences. The construction sector's downturn tempered demand, though some optimism arose from declining mortgage rates and improved housing completions, which provided slight support to the market. Comparing Q2 2024 to the same period last year, prices for Cellulose Ether declined by 7%, indicating a notable decrease, while the quarterly change from the previous quarter showed a moderated depreciation trend at -3%. Notably, there was little price differentiation between the first and second halves of the quarter, emphasizing the consistent and stable market sentiment. Closing Q2 2024, Cellulose Ether (CMC) was priced at USD 4130/MT FOB Texas in the USA. This pricing stability underscores a balanced market environment—neither excessively positive nor negative but characterized by reliability. It reflects a harmonious interplay of stable supply, modest demand improvements, and controlled production costs, fostering a steady pricing landscape for Cellulose Ether across the region.
APAC
In Q2 2024, the Cellulose Ether market in the APAC region faced a strong bearish trend, driven by a combination of adverse economic and industrial conditions. Throughout the quarter, several key factors contributed to the decline in Cellulose Ether prices. The primary driver was sluggish demand from the construction sector, which dampened purchasing sentiment across downstream industries, especially in coatings. Additionally, logistical challenges such as port congestion and soaring global shipping costs worsened market oversupply, making destocking efforts difficult for suppliers. China, experiencing the most significant price fluctuations, reflected an ongoing downward trend. Seasonal factors, including reduced construction activity after holidays and the onset of the rainy season, further depressed the market. Price trends in Q2 2024 showed a continuous decline, with a notable 12% drop compared to the same quarter the previous year and a 2% decrease from the preceding quarter. The latter half of the quarter saw an additional 2% decline compared to the first half, highlighting persistent negative sentiment. By quarter-end, Cellulose Ether HEC (80000-100000) Grade FOB Qingdao was priced at USD 4900/MT, marking a significant decrease indicative of a challenging pricing environment. This downturn was driven by weak demand, seasonal fluctuations, and logistical bottlenecks. Consequently, Q2 2024 posed formidable challenges for the Cellulose Ether market in APAC, with China navigating the forefront of these adverse trends.
Europe
In the second quarter of 2024, the European Cellulose Ether market has shown a diverse yet increasingly positive pricing trend. Key factors shaping market dynamics include heightened secondary demand from the FMCG sector and favourable conditions in the beverage industry downstream. While internal supply chain disruptions and a slight decline in Propylene Oxide prices (around 1%) applied downward pressure, the overall balance of supply and demand maintained a bullish sentiment. Germany, notably, experienced significant price fluctuations within the region. The market here was influenced by seasonal demand shifts and increased manufacturing activities, which offset some earlier contractions. Despite challenges in the coating and construction sectors, prices in Germany managed to stabilize, showing no change quarter-on-quarter compared to the same period last year and a 2% decrease from the previous quarter of 2024. The first half of the quarter saw prices rise by 1% compared to the second half, reflecting a stable demand-supply landscape. By the end of the quarter, Cellulose Ether (CMC) was priced at USD 4000/MT FOB Hamburg, indicating a moderately stable market. Despite supply chain disruptions and reduced primary demand from coatings, Germany's retail sector improvement and increased FMCG demand helped maintain price stability. Overall, while facing various influences, the German market retained a stable sentiment, suggesting cautious optimism for the year ahead.
For the Quarter Ending March 2024
North America
During the first quarter of 2024, the North American Cellulose Ether market experienced a predominantly negative trend. Overall, product prices depreciated by around 1.5%, driven by increased production levels and limited exports to international markets.
Despite a rise of approximately 3.5% in feedstock prices for Propylene Oxide, the subdued construction sectors in Asian and European importing markets largely influenced the US Cellulose Ether market. Additionally, challenges at key waterways, such as droughts at the Panama Canal and the ongoing crisis in the Red Sea, hindered North American suppliers from exporting to European and Asian markets respectively.
Elevated freight costs further dampened export orders throughout the quarter. The downturn in China's construction sector, characterized by liquidity issues among real estate developers leading to halted construction activities and inventory procurement delays, contributed to the decline in the export US Cellulose Ether market. Slow restocking activities in Asia resulted in product stockpiling at US ports, preventing any positive movement in the North American Cellulose Ether market.
Asia
During the initial quarter of 2024, Cellulose Ether prices in the Asian market experienced an overall decrease of about 0.5 percent. Notably, there was no support from the feedstock Propylene Oxide (PO), which depreciated by around 8 percent during this period. The principal driver behind the downturn in the Asian Cellulose Ether market was the persistent decline in the construction sector, marked by reductions in residential starts and public construction orders. Additionally, many construction firms faced heightened input costs, leading to project deadline extensions, decreased initiation of new projects, and inventory postponements. Consequently, stockpiling occurred, prompting suppliers to reduce product prices. Following the Chinese Lunar New Year festivities, restocking conditions were sluggish, with restocking efforts limited to essential needs. Export conditions remained unfavorable due to ongoing crises at the Red Sea and droughts conditions at the Panama Canal. Moreover, adverse weather conditions at major ports such as Shanghai continued to disrupt operations, resulting in delayed departures to other importing nations.
Europe
During the first quarter of 2024, the European Cellulose Ether market experienced a blend of sentiments. Initially, there was a 2% increase in product prices, which was followed by a subsequent decline of approximately 2% later in the quarter. Initially, rising prices of the feedstock Propylene Oxide, up by around 6% during this period, drove the European Cellulose Ether market, leading to increased production costs. However, demand from downstream coating industries continued to weaken due to the sluggish construction sector, which began affecting the market midway through the quarter. The downturn in the construction sector, particularly evident in Germany, where permits and construction projects declined, drove Cellulose Ether prices. Real estate firms remained pessimistic throughout the year, with investment sentiments historically negative, and contractions observed across all segments of the construction sector—residential, commercial building, and civil engineering activities. However, during the middle of the first quarter, the European Cellulose Ether market saw some demand-side support from improving conditions in the British, Dutch, and Belgian markets. Despite this, it was insufficient to alter the prevailing market situation. Furthermore, challenges in the existing supply chain, including strikes by union workers leading to limited railway functionality and transportation and logistics constraints, also contributed to price increases.
