For the Quarter Ending December 2024
North America
In Q4 2024, the North American Microcrystalline Cellulose market saw a notable decline, with prices staying on the weaker side. The price drop was largely driven by reduced production costs in major manufacturing regions, leading to heightened price competition among global exporters. U.S. buyers delayed purchases, anticipating further price drops, while high domestic inventories led suppliers to adopt aggressive pricing strategies. Additionally, the depreciation of the U.S. dollar against the yuan made imports from China more cost-effective, increasing market pressure.
Chinese imports continued to drive down prices, supported by favorable production conditions in China and the yuan’s depreciation, which kept export prices competitive. Weak demand from the pharmaceutical sector, particularly for Microcrystalline Cellulose used in cholesterol-lowering medications, resulted in stagnant market activity and excess stock. Domestic suppliers, struggling with sluggish sales, implemented aggressive destocking strategies to manage inventory.
By December, the market sentiment remained negative, with reduced procurement and muted demand from key sectors. Intense price competition from Chinese imports further pressured U.S. suppliers, leaving the market in a bearish state with little expectation of price recovery.
Asia Pacific
The APAC Microcrystalline Cellulose (MCC) market, particularly from China, exhibited a general downward trend in Q4 2024, with a brief mid-quarter recovery. In October, the market experienced price corrections driven by weak demand and excess inventory. The resulting supply-demand imbalance created favorable conditions for buyers, compelling manufacturers to reduce prices. Moreover, currency fluctuation played another significant role as a weaker Chinese yuan helped make MCC more affordable for foreign buyers, further driving down export prices for this month also. Supporting to this further, this trend was exacerbated by geopolitical uncertainties, including President-elect Trump’s announcement of potential new tariffs, which prompted aggressive destocking by Chinese suppliers through discounted pricing strategies. Additionally, China's currency devaluation in response to tariff threats added complexity to pricing dynamics, further pressuring export prices. High inventory levels and conservative purchasing strategies from key importing nations reinforced bearish market sentiment. Meanwhile, cost support from feedstock wood pulp remained weak, keeping production costs low and prices under pressure. As a result, these factors collectively sustained the downward trajectory in export prices for Microcrystalline Cellulose from China with market transactions leaning on the southerly side.
Europe
Germany's Microcrystalline Cellulose (MCC) market experienced predominantly bearish conditions throughout Q4 2024. Prices declined due to weak downstream demand and limited procurement activity, exacerbated by the depreciation of the euro against the USD, which increased import costs. Competitive Asian supplies further influenced market dynamics. In November, the downtrend continued, driven by reduced production costs in APAC countries and sluggish economic activity in the eurozone. As a major importer, Germany reflected international pricing trends, with traders adopting cautious strategies. In December, the market faced additional pressures from surplus supply and weakened buying sentiment. Stockpiling during the holiday season resulted in excess inventory, leading to market imbalances. Operational challenges, including adverse weather, reduced workforce availability, and port congestion at Rotterdam and Hamburg, disrupted logistics and raised transportation costs. Consequently, buyers remained hesitant, limiting purchases to immediate needs. The quarter ended with reduced import volumes and sustained price depression, driven by persistent euro devaluation, high inventory levels, and seasonal disruptions.
