For the Quarter Ending September 2024
North America
The North American Phenol market experienced a decline in prices during the third quarter of 2024, with the United States witnessing the most significant changes. Several factors contributed to this downward trend.
Insufficient demand from downstream industries, including construction and automotive, played a crucial role in the price decline. This muted consumption led to an oversupply of finished Phenol products, further pushing prices down.
The energy sector also had an impact on pricing, as falling crude oil prices influenced production costs. Reduced manufacturing activity and a cautious approach from buyers amidst uncertain demand outlooks further challenged the market.Overall, the combination of weak demand, oversupply, and factors related to the energy sector contributed to the decline in Phenol prices in North America during the third quarter of 2024.
In the USA specifically, Phenol prices exhibited a decreasing trend throughout the quarter. Comparing the previous quarter in 2024, prices dropped by 2%. Notably, there was a significant -3% price difference between the first and second half of the quarter. The quarter-ending price for Phenol FOB Louisiana in the USA settled at USD 1080/MT, reflecting the prevailing decreasing pricing environment.
APAC
The Phenol market in the Asia-Pacific (APAC) region witnessed a gradual decline in prices during the third quarter of 2024. Several factors contributed to this downward trend. Weak demand from downstream industries, particularly Bisphenol A, played a significant role in the price decrease. Coupled with steady supplies of Phenol, this imbalance between supply and demand led to a cautious and stable pricing environment. The availability of sufficient Benzene to meet production needs further contributed to the decline in prices. As demand from downstream industries remained subdued, the surplus supply of Phenol created downward pressure on the market. However, Japan stood out with the most significant price changes during this period. Despite a slight 2% increase from the previous quarter in 2024, the second half of the quarter recorded a 3% decrease, indicating a fluctuating market. The latest quarter-ending price for Phenol FOB-Osaka in Japan settled at USD 900/MT, reflecting the overall decreasing sentiment in pricing. The quarter was marked by a negative pricing environment, with market conditions leaning towards stability despite minor fluctuations.
Europe
Throughout Q3 2024, the Phenol market in Europe experienced a consistent decline in prices, driven by several key factors. Weak demand from downstream industries, particularly the construction and automotive sectors, played a significant role in the downward pricing trend. The ample availability of finished Phenol stock further contributed to the price stability. The resumption of production in the U.S. Gulf of Mexico post-Hurricane Francine has led to an increase in the supply of crude oil, which has put downward pressure on crude oil prices. Lower crude oil prices have led to lower Phenol prices. Additionally, an increase in the supply of benzene has led to lower Phenol prices. The overall trend in the market indicated a bearish sentiment, with supply being moderate and demand remaining low to moderate. In the Netherlands specifically, Phenol prices saw the most significant changes in the region. With a -10% change from the previous quarter in 2024, the market experienced a notable decline. The -13% change between the first and second half of the quarter further emphasized the downward trajectory. The quarter-ending price of Phenol FD Rotterdam in the Netherlands was settled at USD 1225/MT, reflecting the prevailing negative sentiment in the market.
For the Quarter Ending June 2024
North America
In Q2 2024, the Phenol market in the North America region experienced a notable uptrend, driven by several significant factors. The primary catalyst for the price increase was a surge in manufacturing costs, influenced by bullish crude oil prices. The Organization of the Petroleum Exporting Countries and its allies (OPEC+) maintained a robust growth outlook for global oil demand, further elevating crude prices. Anticipated higher fuel demand during the summer months also contributed to this trend. Additionally, inquiries from downstream construction industries improved, albeit gradually, supporting the upward shift in Phenol prices.
Focusing on the USA, the market saw the most substantial price changes. Overall trends indicated a stable yet increasing sentiment, influenced by seasonal demand fluctuations and a complex interplay of supply chain dynamics. Furthermore, escalating attacks in the Red Sea have forced shipping companies to reroute vessels around Africa's Cape of Good Hope, increasing voyage times and freight rates.
However, the manufacturing sector faced pressure from high borrowing costs due to the Federal Reserve's efforts to manage inflation, impacting overall demand for Phenol. Despite these challenges, manufacturers maintained adequate production activities, balancing supply and demand effectively. The quarter concluded with Phenol DEL Louisiana prices at USD 1095/MT, indicating a positive pricing environment driven by controlled supply and consistent demand from the construction sector. The overall sentiment in the Phenol market remained predominantly stable, with an underlying positive trend.
APAC
In Q2 2024, the Phenol market in the APAC region exhibited a marked upward trajectory, driven primarily by constrained supply, heightened demand from key downstream sectors, and rising crude oil prices. Limited production rates and trade pressures further exacerbated the supply shortage, while geopolitical tensions in Eastern Europe and the Middle East propelled crude oil prices closer to $82 per barrel, impacting raw material costs and, subsequently, Phenol prices. The consistency in cautious buying behavior, characterized by smaller orders, reflected market participants' reluctance to chase high prices, yet the overall trading volume witnessed substantial support from demand recovery post-festivities and the steady climb in production inputs. Focusing on Japan, the country experienced the most significant price fluctuations within the region. Seasonal demand shifts and the strategic decisions of manufacturers to incrementally raise prices were pivotal. Furthermore, Japanese manufacturing firms have been reorganizing their petrochemical operations in response to average demand in Japan and rising production levels in China. As of the latest quarter, the closing price of Phenol stood at USD 940/MT FOB-Osaka. This reflects a stable yet positive pricing environment, with sustained upward momentum linked to a combination of supply constraints, rising raw material costs, and strategic market positioning by manufacturers. The overall sentiment in Q2 2024 for the APAC region was decisively positive, driven by intricate interplay between supply chain challenges and robust demand from downstream industries.
Europe
In Q2 2024, Phenol pricing in the Europe region has exhibited a varied trend, driven by a confluence of factors that have substantially influenced market prices. In early Q2, the demand from the downstream Bisphenol A industries has been observed to be lackluster, as a result, the procurement of upstream Phenol has decreased. As a result, the manufacturers have reduced their offers. On the upstream front, the cost support from Benzene has also been limited to strengthen the pricing dynamics of Phenol. Furthermore, the downstream production facilities have been operating at slightly reduced rates as there was already enough availability of the finished stocks to meet the demand from the terminal markets. However, with an increase in freight rates and Crude Oil prices, the prices of Phenol have improved in the second half of the Q2 2024. Focusing exclusively on Germany, the market has seen the most significant price changes within the region. The seasonality trends, coupled with the summer peak in crude oil demand, have bolstered the upward momentum in Phenol prices. The correlation in price changes can be observed with an approximately 5% uptick from the previous quarter in 2024, reflecting bullish market dynamics. The latest quarter-ending price of Phenol FD Hamburg in Germany was USD 1550/MT, encapsulating the consistent increase throughout Q2. The increasing prices context for Phenol in Europe during this quarter reflects a predominantly positive pricing environment, influenced by heightened raw material costs and global supply-side pressures. The market's resilience amidst these challenges indicates a strong pricing trajectory, particularly in Germany, which continues to lead the region in price volatility and increments.
For the Quarter Ending March 2024
North America
In Q1 2024, the North American region experienced increasing prices for Phenol. Various factors influenced market prices during this period. One significant factor was the rising prices of upstream Benzene, which resulted in higher manufacturing costs for Phenol. Additionally, concerns about crude oil supply, due to production cuts by OPEC+ nations, posed challenges for the downstream petrochemical industry. The reduced production rates of manufacturing firms also led to a lower availability of finished goods, causing manufacturers to raise their prices. On the demand side, inquiries from the downstream Bisphenol A industries improved, supporting the upward trend in Phenol prices.
However, there were a few disruptions that affected the market. INEOS Phenol's plant in Theodore, Alabama faced a force majeure event due to freezing weather, resulting in a disruption in production from January 16 to January 25. Similarly, Shell Chemicals' plant in Deer Park, Texas experienced an unforeseen outage, leading to a disruption in production from January 1 to January 31. Additionally, Shell Chemicals' plant in Deer Park, Texas experienced another disruption in February due to unforeseen outages, resulting in reduced production from February 1 to February 24.
The USA, in particular, witnessed significant price changes during Q1 2024. The market sentiment for Phenol remained bullish, with prices increasing by 23% compared to the previous quarter. There was a noticeable price difference between the first and second half of the quarter, with a decrease of 15% in the latter half. The quarter-ending price for Phenol in the USA was recorded at USD 1050 per ton.
APAC
Phenol prices in the APAC region for Q1 2024 have experienced a decreasing trend. Several factors have influenced market prices during this quarter. Overall, the market has been characterized by stable to negative sentiment, with prices showing a downward trajectory. In Japan specifically, the price changes have been the most significant. The quarter started with a 10% decrease compared to the previous quarter in 2024. This drop can be attributed to subdued demand from downstream industries, particularly in the construction sector. Additionally, the Chinese market has also contributed to the negative sentiment, with a lack of demand and reduced procurement activities due to the Spring Festival Holidays. Looking at the year-on-year comparison, there has been a significant decline in prices, with a decrease of 16%. This can be attributed to the overall economic slowdown in the region. The market has faced challenges such as weak consumer spending and rising inflationary pressures. The latest quarter-ending price for Phenol FOB-Osaka in Japan was recorded at USD 880/MT. This reflects the overall decreasing sentiment in the market. The price comparison between the first and second half of the quarter reinforces the negative trend, with prices showing a 10% decrease.
Europe
The first quarter of 2024 has seen a significant increase in Phenol prices in the European region. The market has been influenced by several factors that have contributed to the upward trend in prices. These factors include rising prices of upstream Benzene, which have led to higher manufacturing costs for Phenol. Additionally, concerns about the supply of Crude Oil, due to production cuts by OPEC+ nations, have created challenges for the downstream petrochemical industry. Reduced production rates among manufacturing firms have also resulted in a relatively lower availability of finished goods, further driving up prices. In Belgium, Phenol prices have seen the maximum price changes in the region. The market has experienced a bullish trend, with prices increasing steadily throughout the quarter. This can be attributed to higher prices of upstream Benzene, which have raised manufacturing costs for Phenol. Overall, the first quarter of 2024 has been positive for Phenol pricing in Europe. The quarter has seen an 8% increase in prices compared to the same quarter last year. In terms of quarterly changes, prices have risen by 34% compared to the previous quarter in 2024. The price increase between the first and second half of the quarter has been recorded at 24%. The quarter-ending price for Phenol FD Antwerp in Belgium is USD 1630/MT. In summary, the Phenol market in Europe has experienced a bullish trend in the first quarter of 2024, with prices steadily increasing. Factors such as higher upstream costs, reduced production rates, and limited availability of finished goods have contributed to the upward price movement.
For the Quarter Ending December 2023
North America
In the fourth quarter of 2023, the prices of Phenol have remained on the higher end. he inquiries from the downstream Bisphenol A industries have escalated and reinforced the market fundamentals of Phenol. Despite economic challenges in the U.S., construction activity has remained robust due to several factors supporting spending in both residential and nonresidential construction, strengthening the demand fundamentals of Phenol among the manufacturers.
The production activities have been picked up in the US market, as reported by market participants. In October, the U.S. Manufacturing Purchasing Managers' Index (PMI) increased to 50.0 from 49.8 in September, indicating that operating conditions are stabilizing and, boosting the market fundamentals of Phenol. Furthermore, the goods containers have been returning to the U.S. West Coast ports due to resolved labor issues and capacity restrictions at the Panama Canal, signaling a shift in momentum from East Coast ports.
Furthermore, The phenol plant of Shell Chemicals at Deer Park, Texas underwent Force Majeure in December. Amidst the weak seasonal demand, the operating rates of downstream manufacturing firms have also not rebounded in the US market. The latest price of Phenol DEL Louisiana in the USA for Q4 2023 stood at USD 1244/MT.
APAC
Phenol pricing in the APAC region for Q4 2023 witnessed a bearish market sentiment due to several factors. Firstly, low demand from the downstream Bisphenol A industries, resulting in moderate to low demand for Phenol. Secondly, elevated crude oil inventories in the USA and weak demand from the Chinese market led to a decrease in crude oil prices, which put downward pressure on the manufacturing costs of Phenol. Lastly, the operating rates of Phenol manufacturing firms have not fully rebounded, and the availability of Phenol was reported to be moderate to high. Japan witnessed the maximum changes in Phenol prices during this quarter. The country's economy sustained a gradual recovery, primarily bolstered by favorable financial conditions and the impacts of economic stimulus measures. The price trend for Phenol in Japan during this quarter was negative, with a percentage change of -13% from the previous quarter. The price percentage comparison between the first and second half of the quarter was -9%. The price of Phenol FOB-Osaka in Japan at the end of Q4 2023 was USD 880/MT.
Europe
The European Phenol market in Q4 of 2023 witnessed a bearish trend with moderate to low demand from the downstream Bisphenol A industries. Throughout Q4, the persistent inflationary pressures have battered the purchasing power of the end-use industries, leading to bearish market sentiments for Phebol. The availability of finished goods remained adequate despite limited production activities. Moreover, the mild winter and above-average inventories led to a decline in European natural gas prices, further reducing production costs. The shutdown of the INEOS Phenol plant during December 2023 had no significant impact on Phenol supply as the market was dominated by lackluster demand from the construction industries. The prices of Phenol in Belgium plummeted by 2.5% to USD 1196/MT in FD Antwerp, due to the destocking season and the year-end holidays. The European chemical industry has faced challenges due to low global oil prices and sluggish demand influenced by factors like OPEC+ production cuts and global economic pressures. The percentage change in the price of Phenol FD Antwerp from the previous year's Q4 is -16%. The price percentage comparison of the first and second half of Q4 2023 in Belgium is -7%.
