For the Quarter Ending September 2024
North America
In Q3 2024, the North American Polyaluminium Chloride (PAC) market saw a consistent decline in prices, driven by several key factors. Reduced demand from downstream sectors such as water treatment, textiles, and paper, along with ample material availability and weak consumption, contributed significantly to the downward pressure on prices. The market also faced challenges due to periodic plant shutdowns and disruptions at major production facilities.
In the U.S., where the most notable price fluctuations occurred, additional factors worsened the situation. Consumer spending and industrial activities in the country decreased, directly impacting the consumption of PAC, especially in critical sectors like water treatment and industrial cleaning. This reduction in demand was further aggravated by global disruptions, including trade route interruptions caused by ongoing conflicts in the Middle East, which affected the availability and cost of key raw materials.
The price decline became more pronounced in the latter half of the quarter, signaling a strong downward trend. By the end of Q3 2024, PAC prices had settled at lower levels, reflecting the negative market sentiment shaped by persistent price drops and challenging market conditions throughout the period.
APAC
In Q3 2024, the APAC region witnessed a notable increase in Polyaluminium Chloride prices. Several factors contributed to this uptrend. Strong industrial activities and heightened demand in the water treatment sector drove consumption, while disruptions like plant shutdowns in China, such as the one at Henan Fengbai Industrial Co., Ltd. due to flooding, impacted supply. This led to a supply-demand imbalance, further pushing prices upwards.
In India, the market experienced the most significant price changes, with a 5% increase from the previous quarter and a 6% difference between the first and second half of the quarter. The quarter-ending price in India stood at USD 386/MT FOB JNPT, reflecting the overall positive pricing environment.
Overall, the quarter was characterized by increasing prices fueled by robust demand, disruptions in supply chains, and specific market conditions influencing the Polyaluminium Chloride market in the APAC region. However, in the last month of this quarter, the demand slowed down along with the industrial activities slowing for the first time in over a year.
Europe
Throughout Q3 2024, the Polyaluminium Chloride (PAC) market in Europe experienced a downturn in prices, with Germany notably impacted by significant fluctuations. The price decline was driven by weakening demand from downstream industries, including water treatment, textiles, and paper, combined with reduced consumer spending and sluggish economic growth.
Additionally, an abundant supply of materials in the region further contributed to the downward pressure on prices. The overall market sentiment remained negative, as pricing trends reflected the difficult conditions faced by Polyaluminium Chloride producers and distributors. Furthermore, towards the end of the quarter, the freight rates also decline coupled with increased container availability which also supported the price declines.
Although there was a slight improvement compared to the previous quarter, the overall pricing environment for Polyaluminium Chloride remained largely stable yet consistently downward throughout the period. The market continued to face persistent challenges due to subdued demand across key sectors, including water treatment and industrial cleaning. Despite occasional restocking efforts by some industries, weak consumer and industrial activity in North America, combined with global supply chain disruptions, prevented any significant recovery.
For the Quarter Ending June 2024
North America
In the second quarter of 2024, the Polyaluminium Chloride market in North America experienced an upward trend. Prices rose in the initial weeks due to increased consumer demand, particularly in the industrial, household, and water treatment sectors, as summer approached. Despite rising costs from upstream markets, overall input costs eased due to a decline in crude oil prices, attributed to an unexpected surge in U.S. crude oil inventories.
By mid-Q2 2024, PAC prices continued to climb due to heightened demand and supply constraints. Although the textile and paper industries showed limited demand, the influence of upstream raw materials. Although, in the quarter, the business confidence improved marginally, the consumer demand in other sectors apart from the water treatment industry was lacking. Although Q1 GDP was weaker than expected, this was primarily due to softer net exports and inventory investment, which offset stronger domestic economic activity.
In the last month of the quarter, PAC prices increased further due to persistent supply stress and strong domestic demand. Upstream prices continued to exert influence, while crude oil prices were driven higher by geopolitical tensions and supply concerns. The U.S. economy showed positive signs, with projections of high inbound cargo volumes despite ongoing supply chain challenges, leading to optimism among industry participants about the future.
APAC
In Q2 2024, the pricing landscape for Polyaluminium Chloride across the APAC region experienced a notable uptrend, driven by a confluence of factors. Robust consumer demand, especially from industries engaged in water treatment and paper manufacturing, played a pivotal role in exerting upward pressure on prices. The summer months typically see heightened agricultural irrigation and increased water consumption due to outdoor activities and elevated temperatures, which significantly escalated the need for coagulants like Polyaluminium Chloride. Focusing on India, the market displayed the most pronounced price changes within the APAC region. The quarter saw a consistent escalation in prices, attributed to robust domestic demand and constrained supply. A comparison between the first and second halves of Q2 reveals a 2% price increase, underscoring a persistent upward trajectory. The correlation between seasonal demand and price trends was evident, with summer activities amplifying water treatment requirements. The overall sentiment was bullish, supported by steady industrial activity and favorable economic conditions. The latest quarter-ending price for Polyaluminium Chloride in India was USD 360/MT FOB JNPT, reflecting a steady and positive pricing environment throughout Q2 2024. The percentage change from the previous quarter in 2024 was recorded at 0%, indicating stability following the quarter's initial gains. These dynamics highlight a robust and increasing pricing sentiment, driven by substantial demand and supply-side constraints.
Europe
In the second quarter of 2024, the Polyaluminium Chloride market in Europe experienced an upward trend. In the first month, prices rose in Germany due to improved supply and demand fundamentals. The German chemical industry's business climate showed positive signs, with the business index rising from -10.1 points in March to -6.0 in April. Companies assessed their business situation more positively and had brighter expectations, signaling increased confidence about the coming months. However, the demand situation remained challenging, with nearly half of the companies reporting insufficient orders, increasing from 40.6% in January to 46.6% in April. Despite these challenges, chemical companies anticipated higher overseas orders and planned to increase sales prices for the first time since January 2023. In the next two months, PAC prices continued to trend upward as market conditions improved, albeit at a slower pace. European markets saw slight improvements due to restocking ahead of the summer vacations, although competition from cheaper Asian imports remained a challenge. The overall order book levels showed gradual improvement, indicating a positive trend, but the chemical confidence indicator, while improving, remained low. High energy and raw material prices, along with a lack of orders, continued to burden businesses. Consequently, companies were forced to cut costs, potentially leading to shutting down production plants, abandoning business segments, or shifting investments abroad. Despite these challenges, the market outlook for the product and the broader chemical industry in Germany appeared cautiously optimistic.
For the Quarter Ending March 2024
North America
The North American Polyaluminium chloride (PAC) market in Q1 2024 exhibited stability amidst steady demand and supply dynamics. Stable demand from municipal water treatment facilities and industrial applications contributed to market equilibrium.
Despite global supply chain disruptions, the PAC market in North America remained resilient, with sufficient product availability to meet demand. Meanwhile, Prices for PAC remained relatively steady during Q1 2024, supported by balanced supply-demand dynamics and consistent raw material costs.
Ongoing adherence to environmental regulations governing water treatment further underpinned market stability. During the quarter, the North American PAC market maintained its stability, with continued demand from water treatment facilities and industrial sectors expected to sustain market equilibrium.
APAC
In Q1 2024, the APAC Polyaluminium Chloride market witnessed significant price fluctuations, mainly declining. Declining raw material costs, particularly Aluminium Chloride resulting in weak production expenses. Decreased demand from downstream sectors led to excess inventory, prompting sellers to offer discounts. China experienced the most pronounced price changes due to lower production costs and reduced international demand. Despite challenges, the Purchasing Managers' Index (PMI) remained stable, signalling manufacturing sector expansion. Compared to Q1 of the previous year, prices declined by 88%, although they slightly rose compared to the previous quarter in 2024. Concluding, the quarter-ending price for Polyaluminium Chloride in India was USD 480/MT FOB JNPT. Overall, Q1 2024 exhibited a negative pricing environment for Polyaluminium Chloride in APAC, driven by decreased production costs and declining demand.
Europe
During Q1 2024, Germany's Polyaluminium Chloride market faced logistical disruptions due to Red Sea unrest and reduced downstream activity. German producers curtailed production since February 2024 due to disrupted supply chains. Concerns heightened over potential port closures during March 2024 Easter holidays. Despite a surge in export value in January 2024, indicative of increased production, cautious downstream industries, influenced by global economic sluggishness and high interest rates, subdued Polyaluminium Chloride demand in Europe. Amid supply disruptions, cautious supply management and discounts were adopted in the feedstock Aluminium Chloride industry. Early 2024 saw significant European market growth driven by lower upstream prices. However, supply concerns emerged in March 2024, particularly with impending German port closures.
