For the Quarter Ending September 2024
North America
In Q3 2024, the North American region saw a notable rise in Linear Alpha Olefin prices, with the USA experiencing the most significant price shifts. Several factors contributed to this increase, including rising ethylene prices and maintenance shutdowns at major chemical plants due to hurricane season. Additionally, hurricanes caused disruptions to facilities such as Shell Chemical Company, Sasol Chemical Industries, and Chevron Phillips Chemical Company LP, which further strained supply chains.
In the USA, the pricing environment remained particularly strong throughout the quarter. Prices assessed for the month of September surged by 19% compared to the assessed price previous year. The prices surged by 16% throughout the quarter cumulatively. This bullish trend was largely influenced by the ongoing supply chain challenges and escalating ethylene costs.
By the end of the quarter, the price for Linear Alpha Olefin C10 Blend FOB US Gulf reached USD 1190/MT. This reflects the sustained upward momentum in the market, driven primarily by supply chain disruptions and the rising cost of key raw materials like ethylene.
Asia Pacific
In Q3 2024, the Linear Alpha Olefin market in the APAC region saw a substantial decline, with Japan experiencing the most significant price drops. The quarter was marked by a challenging pricing environment, driven by several critical factors. Supply disruptions, including maintenance shutdowns at key production facilities, led to supply tightening, which compounded the downward pressure on prices throughout the region. In addition to these supply issues, weakening demand for end-use products and a persistent oversupply situation further exacerbated the price decline. Seasonal factors played a prominent role, as prices in September 2024 registered a 17% drop compared to the same period in 2023. This price drop was largely driven by excess supply, declining polymer prices, easing ethylene costs, and weaker demand sentiment, which weighed heavily on the market. Over the course of the quarter, prices decreased by 5%, with the final price for Linear Alpha Olefin C10 Blend FOB Osaka in Japan settling at USD 1,020/MT by the quarter's end. Overall, the APAC region, particularly Japan, faced a bearish pricing landscape, with negative sentiment prevailing due to ongoing supply-demand imbalances and economic challenges
Europe
In Q3 2024, the European region experienced a bullish quarter for Linear Alpha Olefin prices, marked by significant fluctuations. Various factors influenced market prices, including a decrease in demand for homecare and personal care products, impacting the supply-demand dynamics. The pricing environment was further affected by lower production levels, particularly in key facilities such as those operated by Shell. Additionally, high freight charges and limited tanker slot availabilities added pressure on procurement activities. Germany, in particular, witnessed the most substantial price changes during the quarter. Overall trends indicated a negative correlation in price changes due to lowering of energy and feedstock, with prices of September 2024 falling 8% below the 2023’s September assessed price. However, a notable uptick of 9% was observed this quarter over previous quarter, showcasing some resilience in pricing. The quarter-ending price for Linear Alpha Olefin C10 FD Hamburg in Germany stood at USD 1080/MT, reflecting the ongoing challenges in the market. Disruptions and plant shutdowns further impacted the pricing landscape, contributing to the overall bearish sentiment in the region.
Middle East and Africa
In Q3 2024, the Linear Alpha Olefin pricing in the MEA region witnessed a significant decline, with Saudi Arabia experiencing the most pronounced price changes. The quarter was characterized by a negative pricing environment, influenced by various factors. Supply disruptions, such as the PetroRabigh plant shutdown due to a cracker outage, contributed to supply constraints, impacting prices. Additionally, lower demand for end-use products, supply tightening further checked the declining prices. The correlation between price changes and seasonality was evident, with a notable 17% decline in prices assessed in September 2024 over September 2023. The drop was governed largely by oversupply and falling polymer prices, easing feedstocks like ethylene as well as weaker demand sentiment. The price comparison throughout the quarter revealed a 5% drop. This downward trend culminated in a final price of USD 930/MT for Linear Alpha Olefin C10 Blend FOB Al Jubail in Saudi Arabia at the end of the quarter. Overall, the quarter reflected a challenging pricing landscape with a negative sentiment prevailing throughout.
Latin America
In Q3 2024, the South American region experienced a sharp increase in Linear Alpha Olefin prices. This surge was driven by several key factors, including supply disruptions caused by plant shutdowns, rising demand for downstream derivatives, and higher freight costs. The market saw bullish sentiment throughout the quarter, fueled by tightened supply conditions and strong demand dynamics. Brazil, in particular, experienced significant price shifts, with an 11% increase compared to the prices assessed in September 2024 over September 2023. The cumulative price movement this quarter witnessed a 10% price hike, reflecting the strong market momentum and growing demand. Despite challenges such as elevated freight charges and production constraints, the market remained resilient, and prices continued to rise steadily. By the end of the quarter, the price of Linear Alpha Olefin C10 Blend CFR Santos Port in Brazil reached USD 1090/MT. This upward trend highlights the competitiveness of the market, even amidst ongoing disruptions and economic fluctuations. The ability to maintain positive pricing momentum in such a volatile environment showcases the market's robustness.
For the Quarter Ending June 2024
North America
In Q2 2024, Linear Alpha Olefin (LAO) pricing in North America has experienced a pronounced upward trend, driven by multiple market dynamics. The ongoing increase in feedstock ethylene and ethane prices, coupled with high freight charges and lower slot availabilities on tankers, has significantly impacted the LAO market. Rising natural gas prices and a shrinking ethane premium further exacerbated the cost pressures. Additionally, supply constraints due to unplanned plant shutdowns, such as those at ExxonMobil's Baytown and Shell Chemicals' Deer Park facilities, have tightened the market, leading to elevated prices.
Focusing on the USA, the region has seen the most substantial price changes. Throughout the quarter, the USA has maintained a bullish market sentiment, influenced by strong domestic demand for detergents, surfactants, and lubricants. Seasonal factors, especially the summer procurement period, have further bolstered demand, while the anticipation of hurricane season added upward pressure on prices due to potential supply disruptions. The overall trend has been one of price convergence between domestic and export deliveries, reflecting intense competition from Asian and Middle Eastern suppliers.
Throughout the quarter, prices have increased by 7%, indicating a consistent upward trajectory. The overall price change from the previous quarter is recorded at 10%. This quarter-ending price of USD 1180/MT for LAO C16-18 Blend FOB US Gulf underscores the positive pricing environment, driven by strong demand, supply constraints, and strategic inventory builds. Thus, the pricing context for LAO in North America during Q2 2024 has been decidedly positive, marked by robust market fundamentals and external pressures.
Europe
In Q2 2024, the Linear Alpha Olefin (LAO) market in Europe experienced a pronounced downturn, influenced by several significant factors. The region saw a notable decline in LAO prices, driven by increased feedstock availability, lower electricity charges, and high inventory levels following substantial stockpiling in previous months. This period was marked by bearish sentiment as a result of softened demand, deteriorating economic conditions, and persistent industrial downturns. Additionally, high freight charges and port congestion compounded the pricing pressures, making imports more cumbersome and costly. Furthermore, manufacturers faced intensified competition from Asian and Middle Eastern suppliers, which exacerbated the overall price decline. Germany, in particular, witnessed the steepest price changes in the region. The decreasing trend in LAO prices was significantly correlated with seasonality and industrial activities. The second quarter saw a marked 20% decrease over the quarter. This trend was further exacerbated by several disruptions and plant shutdowns, including the notable stoppage at the INEOS site, which profoundly impacted supply chains and pricing dynamics. The overall pricing environment in Germany was decidedly negative, reflecting the cumulative impact of reduced demand, heightened competition, and logistical challenges. At the end of Q2 2024, the price of Linear Alpha Olefin C12-14 FD Hamburg in Germany stood at USD 1120/MT, underscoring a consistent downward trajectory. This quarter underscores a challenging landscape for LAO, marked by adverse market conditions and significant price erosion.
Asia Pacific
The second quarter of 2024 has been particularly challenging for the Linear Alpha Olefin (LAO) market in the APAC region, characterized by a consistent downward trend in pricing. A confluence of factors has contributed to this bearish market sentiment. Predominantly, weak demand from the lubrication industry, combined with stable yet insufficient demand from surfactants, has placed downward pressure on prices. Additionally, the downward revisions in upstream ethylene prices, driven by lower crude oil prices averaging $81.75/MT Brent basis, have further compounded the cost pressures. An oversupply situation has emerged as inventories remained high across the region, exacerbated by logistical delays and disruptions, including significant congestion at major ports like Malacca and Chinese ports. No major plant shutdowns were recorded during the quarter, indicating that the supply glut was not due to production but rather a mismatch between supply and demand dynamics. In Japan, the LAO market has experienced the most substantial price reductions. The overall trend demonstrates a significant decrease, heavily influenced by seasonal factors and a marked decline in industrial demand. The second quarter saw price drop of 19% throughout , culminating in a quarter-ending price of USD 1310/MT for the Linear Alpha Olefin C16-18 Blend FOB Osaka. This stark decline highlights a negative pricing environment, underpinned by sustained oversupply and inadequate demand recovery. The persistent bearish sentiment suggests that the market remains under considerable strain, with little relief anticipated in the immediate future.
Middle East and Africa
In the second quarter of 2024, the Linear Alpha Olefin (LAO) market in the MEA region experienced a pronounced decline in prices. This downturn was largely driven by several interlinked factors. Firstly, the global increase in crude prices during March and April heightened feedstock costs, exerting substantial pressure on the downstream ethylene value chain, including Linear Alpha Olefin. Concurrently, geopolitical tensions and shipping disruptions in the MEA region further aggravated the situation by causing significant delays and elevated freight charges, which dissuaded international buyers and contributed to bearish market sentiment. Focusing on Saudi Arabia, which observed the most marked price changes, the overall trend showcased a persistent decrease. Seasonal factors, such as the reduced production hours during the Hajj pilgrimage, compounded the bearish outlook. The correlation between heightened supply and dwindling demand resulted in a stark price reduction, evident from the 16% drop throughout the second quarter. Despite no major plant shutdowns during this period, the market faced operational challenges due to geopolitical instability and fluctuating crude outputs. By the end of the quarter, the price of Linear Alpha Olefin C16-18 Blend FOB Al Jubail in Saudi Arabia had plummeted to USD 1280/MT, underlining a negative pricing environment exacerbated by oversupply and weak demand dynamics. This quarter's performance highlights a market grappling with high inventory levels and subdued global economic activity, leading to consistently declining prices.
Latin America
In Q2 2024, Linear Alpha Olefin (LAO) pricing in Latin America has experienced a pronounced upward trend, driven by multiple market dynamics. The ongoing increase in feedstock ethylene and ethane prices, coupled with high freight charges and lower slot availabilities on tankers, has significantly impacted the LAO market. Rising natural gas prices and a shrinking ethane premium further exacerbated the cost pressures. US revised their prices upwards for hexene deliveries into Latin America as domestic cost have continued to remain higher than US supply cost. Focusing on Brazil, the region has seen the most substantial price changes. Throughout the quarter, Brazil’s markets have maintained a bullish market sentiment, influenced by strong domestic demand for detergents, surfactants, and lubricants. Seasonal factors, especially the pre- winter procurement period, have further bolstered demand, while the anticipation of hurricane season in the Northern American regions added upward pressure on prices due to potential supply disruptions. The overall trend has been one of price convergence between domestic and export deliveries, reflecting intense competition from Asian and Middle Eastern suppliers. Throughout the quarter, prices have increased by 7%, indicating a consistent upward trajectory. This quarter-ending price of USD 1130/MT for LAO C16-18 Blend FOB US Gulf underscores the positive pricing environment, driven by strong demand, supply constraints, and strategic inventory builds. Thus, the pricing context for LAO in North America during Q2 2024 has been decidedly positive, marked by robust market fundamentals and external pressures.
For the Quarter Ending March 2024
North America
The North American market for Linear Alpha Olefin (LAO) experienced a mixed pricing environment in the first quarter of 2024. Overall, prices remained bullish but with a slight downward trend early in the quarter. Several factors influenced market prices during this period. In the USA, which saw the maximum price changes, the LAO market experienced a bearish sentiment in the first half of the quarter. Prices for LAO C10 blend FOB US Gulf decreased by USD 50/MT, representing a significant decrease of 5.9% from the previous quarter. This downward trend can be attributed to cooling demand and falling feedstock prices. The manufacturing sector, a key consumer of LAO, remained subdued, leading to weakened demand. Additionally, competition from Middle Eastern and American suppliers further pressured prices in the region. Comparing to the same quarter last year, prices of LAO in the USA were significantly lower, recording a decrease of 19% from the previous fiscal year as downturns intensified previously. This decline can be attributed to the overall economic challenges faced by industry.
Looking at the price comparison between the first and second half of the quarter, prices moved upwards due to newer contracts for ethylene supply being sought with cost escalations observed over USD 200/MT to the market participants. However, it can be inferred that prices remained relatively stable during this period. The quarter-ending price for LAO C10 blend FOB US Gulf in the USA was recorded at USD 900/MT. This represents a slight decrease from the previous quarter but still reflects a stable recovering pricing environment.
In conclusion, the pricing environment for LAO in the North American market during the first quarter of 2024 was bullish, with prices experiencing a slight downward trend. Recovery in demand and falling feedstock prices were the main factors influencing market prices. However, prices remained relatively stable throughout the quarter.
Europe
The pricing environment for Linear Alpha Olefin in Europe during Q1 2024 has been largely negative, with prices experiencing bullish trend. This can be attributed to rising ethylene prices and easing of the downturns in European manufacturing. The market has been influenced by factors such stabilization and bottoming out of demand, including in the lubrication and surfactant sectors. Additionally, high interest rates and consumer prices have dampened consumer sentiment, resulting in lower demand for Linear Alpha Olefin in Europe.
Belgium has seen the maximum price changes during this period. The market in Belgium has been particularly bullish with producers observing easing of downturns due to newer supply contract of feedstock and raw materials with US and Middle Eastern suppliers. The Belgian consumer market, including the cosmetics sector, has also been impacted by high interest rates and consumer prices. The pricing trend in Belgium reflects a consistent bearish sentiment, with prices rose by approximately 5.7% compared to the previous quarter.
Overall, the pricing environment for Linear Alpha Olefin in Europe has been characterized by increasing downstream production and inventory building. The market has been influenced by factors such as supply chain disruptions, including strikes and adverse weather conditions. While there have been some signs of improving demand in certain sectors, the overall pricing trend remains positive. In conclusion, the latest quarter-ending price for Linear Alpha Olefin C10 Blend FD Antwerp in Belgium is USD 1340/MT. The pricing environment for Linear Alpha Olefin in Europe during Q1 2024 has been bullish, with prices experiencing a bullish trend due to moderate demand and cooling off high contract prices.
Asia Pacific
The first quarter of 2024 has seen mixed trends in the pricing of Linear Alpha Olefin (LAO) in the APAC region. Overall, the market has experienced positive sentiment, with prices showing an upward trend. However, there have been fluctuations in prices due to various factors. In Japan, the price of LAO has seen significant changes during this quarter. The market has been influenced by factors such as supply shortages, high inventory requirements, and increased demand from the domestic market. The Lunar New Year festivities have also contributed to the rise in demand for LAO, particularly in the cosmetics and homecare products sectors. Additionally, freight charges and global inflation concerns have impacted prices.
In terms of overall trends, the APAC region has experienced a bullish market situation, with moderate to high demand for LAO. Supply has been moderate, with suppliers increasing their inventory volumes to meet the growing demand. However, supply has also been affected by shipping container shortages and disruptions in the Middle East. Looking at price changes, there has been a positive growth in prices compared to the same quarter last year. The percentage change from the previous quarter in 2024 has also been positive. However, there have been fluctuations in prices within the quarter, with prices surging towards the end of the quarter due to supply chain challenges.
As of the quarter-end, the price of LAO in Japan was recorded at USD 1410/MT for the C10 Blend FOB Osaka. This indicates a stable pricing environment, albeit with some volatility throughout the quarter. Overall, the pricing environment for LAO in the APAC region during the first quarter of 2024 can be characterized as positive, with an upward trend in prices driven by factors such as increased domestic demand and supply chain challenges.
Middle East and Africa
The first quarter of 2024 has been a mixed period for Linear Alpha Olefin (LAO) pricing in the MEA region. Overall, market prices have been influenced by several significant factors. In particular, the ongoing export demand from Europe and Asia has contributed to positive sentiment and a surge in prices. Additionally, rising feedstock ethylene prices have impacted the downstream surfactant and detergent product chain, further driving up LAO prices. In Saudi Arabia, which has experienced the maximum price changes, the LAO market has seen a tightening supply situation. Suppliers have been increasing their inventory volumes to meet the continuous delivery schedule, but domestic stocks remain on the low side due to strong sales. The prices have almost recovered to the levels of the previous fiscal year, primarily due to suppliers restricting supply to maintain prices. However, the negative pressure from energy costs has partially offset the gains in downstream LAO polymer pricing.
Demand for LAO in the region has been moderate to high, driven by outstanding business orders and rising new order books. The Saudi construction market, in particular, has contributed to strong market activity for LAO. However, demand has also been impacted by factors such as cooling off export sentiment to China and Europe, as well as subdued manufacturing and high interest rates.
Overall, the pricing environment for LAO in the MEA region during the first quarter of 2024 has been bullish, with prices experiencing both upward and downward trends. However, the latest quarter-ending price for LAO C10 Blend FOB Al Jubail in Saudi Arabia is USD 1230/MT, reflecting a decrease of USD 20/MT or 2.2% compared to the previous quarter. In summary, the LAO pricing environment in the MEA region has been influenced by export demand, feedstock prices, supply tightness, and demand dynamics. The market has experienced both positive and negative trends, with Saudi Arabia being the most affected.
For the Quarter Ending December 2023
North America
Prices of Linear Alpha Olefin showed a bearish sentiment in Q4 FY2023. Feedstock ethylene and energy prices followed bearish sentiment in the given timeframe amidst strong US crude and gas production. Supply of Linear Alpha Olefin largely remained domestic with oversupply sentiments. Ethylene markets remained bearish largely due to oversupply and negative feedstock pressures.
Demand from downstream Polyethylene grades remained muted due to weak consumption triggered by rising interest rates by US Federal reserve leading to high inventory stocks across the value chain of PE products. Retail consumption continues to show resilience despite high interest rates while October mortgage rates further slowdown of demand. Winter situation arrived late in December with requirements for Linear Alpha olefin surfactant and lubrication grade further slowed down. As inflation soared again in December, major suppliers have been reducing their inventory stocks further as US Federal Reserve signaled late rate.
Construction market has been showing gradual signs of recovery in USA with mortgage rates falling and consumers showing willingness for newer houses. By the end of December, demand for Linear Alpha Olefin slowed down further amidst rising uncertainty as Suez Crisis deepened forcing downstream polyethylene producers to reduce operating volumes as supply tightened coupled with slowing of demand as interest rates and fear of inflation dominated the market players tactical buying strategies.
Europe
Prices of Linear Alpha Olefin showed a bearish sentiment in Q4 FY2023. Feedstock pressures continued to remain negative largely due to US and Chinese overproduction keeping up the supply of Linear Alpha Olefin. INEOS and LyondellBasell oligomers continue to run at lower operating capacities as downstream demand for Linear Alpha Olefin slowed down largely on the back of lower automobile demand in the given timeframe. In the given quarter, feedstock ethylene began their bearish trend by falling down by 8% in the given timeframe since the beginning of the quarter. Supply of Ethylene was largely domestic with substantial imports from US and Middle East to stabilize the pricing. Till December, the market players observed weaker demand due to high inventories of Linear Alpha Olefin/ethylene copolymer due to lower heating demand. HCOB Germany Manufacturing PMI index continues to show contraction in the entire quarter. Similar contractions occurred in Italy, Belgium, Netherlands in construction sector. Linear Alpha Olefin demand from energy efficient and renewable renovations fell drastically amidst as major Eurozone countries reduced subsidies for transitioning into sustainable sector. Furthermore, Natural gas volumes in Europe remained on the higher end to satisfy the quarter demand forcing destocking of Natural gas by Europe pulling down feedstock prices. Major crackers across Europe underwent downturn maintenance in the given week which balanced falling demand significantly pulling down the market prices. In December, supply chain started tightening globally due to Suez Canal crisis and lower navigability of riverine logistics, further slowing down Europe’s capacities for Q4FY24. Consumer demand remained lower on a Q-o-Q basis. With European nations reducing subsidies for transition comes to an end on January 1 FY24, elevated temperatures for the winter season till December, demand for Linear Alpha Olefin is anticipated to remain subdued till the first half of FY24.
Asia Pacific
Prices of Linear Alpha Olefin turned bearish sentiment in Q4 FY2023. Prices declined by 8% from the beginning of quarter till 29th December 2023. Feedstock ethylene prices showed mixed sentiment with prices remaining stable in the months of October and November with prices declining in the month of December. Chinese demand for downstream lubrication, surfactant remained on the lower end on the back of lower demand sentiment as construction demand coupled with major plants remaining off-streams and lower demand for conventional passenger vehicles due to higher fuel prices in APAC region kept demand for Linear Alpha Olefin low. Chinese continued to expand Linear Alpha Olefin. C10 grade. Furthermore, Consumer demand driven segment for Linear Alpha Olefins remained subdued as large section of consumers in China are currently facing financial shortages due to real estate crisis and high cost of finances. South Korean, Japan’s domestic market continued for Linear Alpha Olefin largely driven by automotive demand which remained subdued due to lower global exports. APAC North America trade for Linear Alpha Olefin showed marginal improvements largely driven by improvement in US markets due to improved sales of automobiles as fuels prices deflated significantly in North America. APAC regions continue to show improvement in the volumes. In the South Korean markets, domestic demand for Linear Alpha Olefin remained low largely due to subdued construction and lower automobile demand as interest rates remained on the higher end. Export orders of Linear Alpha Olefin derived goods to European markets remained on the lower end due to seasonal slump with the quarter ending with supply disruptions and further falling export demand due to high CIF charges.
South America
The fourth quarter of 2023 was challenging for the South American region's Linear Alpha Olefin (LAO) market. Several key factors influenced the market and prices during this period. Firstly, there was an oversupply situation in the market, leading to a decline in demand. This was partly influenced by high corporate debt and interest rate charges, which resulted in reduced domestic demand and increased imports, particularly from the USA. Additionally, domestic producers faced cost pressures compared to their US counterparts due to higher energy and feedstock costs.
In terms of Brazil, which experienced the most significant price changes, the market saw a bearish trend in November. Domestic demand for LAO declined, while imports from the USA continued to dominate the market. The financial crunch faced by major players like Petrobras also impacted the market, as government spending was tightened to control debt. Despite lower domestic volumes, prices continued to deflate on a year-on-year basis due to the costlier feedstock sales by Petrobras compared to the USA.
The latest price for Linear Alpha Olefin C10 Blend CFR Santos Port in Brazil for the current quarter is USD 870/MT. The price change from the previous quarter was -7%, indicating a decrease in prices. Additionally, the price comparison between the first and second half of the quarter showed a -6% decline.
Middle East Asia (MEA)
The fourth quarter of 2023 was characterized by a mixed market for Linear Alpha Olefin (LAO) in the MEA region. Several factors impacted the market and prices during this period. Firstly, there was a moderate supply of LAO, with feedstock ethylene shortage observed globally. This led to supply constraints and production cuts in some countries. Secondly, the demand for LAO remained low to moderate, with marginal declines observed in the international market. Weak seasonal demand and rising costs of feedstock and energy contributed to this trend. Lastly, the geopolitical factors and higher crude prices affected the overall supply situation and market dynamics. Focusing on Saudi Arabia, the largest producer in the region, there was a significant increase in the price of LAO. The price of C10 Blend FOB Al Jubail rose by 10.0% to USD 1420/MT. This increase was mainly driven by the global rise in crude oil prices and supply constraints.
In comparison to the same quarter of the previous year, there was a 4% increase in prices. However, when comparing to the previous quarter, there was a 2% decrease in prices. Additionally, during the second half of the quarter, there was a 3% decrease in prices compared to the first half. Overall, the market for LAO in the MEA region experienced mixed conditions during the fourth quarter of 2023, with supply constraints and geopolitical factors impacting prices. The price of LAO in Saudi Arabia at the end of the quarter was USD 1140/MT.
