For the Quarter Ending December 2024
North America
In the fourth quarter of 2024, the Polyol market saw a 6% decrease compared to the previous quarter, driven by mixed demand and supply chain disruptions. Polyol production remained stable, supported by moderate feedstock availability, although fluctuations in Propylene Oxide prices and upstream Propylene costs affected cost dynamics. Exports slowed, particularly to Europe and Australia, due to weaker global demand and a downturn in U.S. manufacturing activity.
Demand for downstream PU materials from the construction sector was sluggish, influenced by high inventory levels and rising material costs, particularly in the furniture industry. Conversely, the automotive sector showed resilience, with increased vehicle sales supporting steady Polyol demand.
By December, despite stable domestic demand in the automotive and coatings sectors, Polyol exports declined, with new business orders and international market activity weakening. The winter season saw higher demand for heating, pushing up Propane prices and providing some support for Polyol production costs. However, with weaker global demand and slower export growth, the market experienced a 6% decline compared to the previous quarter.
APAC
In the fourth quarter of 2024, the Polyol market in Japan experienced no change in prices compared to the previous quarter, with stability across demand and supply dynamics. Production remained steady, supported by moderate feedstock availability, and feedstock Propylene Oxide prices stabilized amid fluctuations in upstream prices. Shipping disruptions from Typhoon Kong-Rey and weak Far East exports slightly impacted supply levels, but the overall supply to importers remained manageable. Demand for Polyol showed mixed results. The construction sector saw strong demand, driven by a significant increase in construction orders, while the automotive sector faced a decline due to reduced vehicle sales. Despite these mixed trends, Polyol prices remained unchanged due to steady production and moderate costs influenced by rising crude oil prices. Supply chains gradually stabilized, and although export volumes were lower and automotive demand weakened, the overall market conditions did not lead to significant price fluctuations. As a result, Polyol prices held firm through the quarter, reflecting a balance between stable production and moderated demand from key sectors.
Europe
Like the North American region, in the fourth quarter of 2024, the Polyol market saw a 6% decline compared to the previous quarter, reflecting ongoing challenges in demand and supply dynamics. Polyol production remained stable, supported by moderate feedstock availability, although disruptions at key European ports and rail congestion impacted supply chains. Feedstock Propylene Oxide prices held steady due to fluctuations in upstream crude oil prices and shifting demand from downstream industries. Demand for Polyol varied across sectors. The construction industry continued to face subdued demand, driven by reduced activity and economic uncertainty. In contrast, the automotive sector saw increased demand, particularly due to higher new car registrations. However, this was not enough to offset the overall market decline. Polyol prices remained relatively stable, with minimal fluctuation driven by supply chain disruptions and moderate feedstock availability. The overall Eurozone manufacturing downturn and inflationary pressures contributed to weakened demand in key sectors. In the construction sector, activity remained sluggish, while automotive demand, though slightly stronger, also showed signs of slowing. These factors combined led to a 6% decrease in Polyol prices from the previous quarter.
For the Quarter Ending September 2024
North America
Throughout Q3 2024, the Polyol pricing in the North American region remained stable, with no significant fluctuations observed. Various factors contributed to this stable pricing environment. The demand for Polyol was moderate, primarily driven by consistent consumption in downstream industries such as construction and manufacturing. Supply levels were adequate to meet this demand, leading to a balanced market scenario. Additionally, stable cost support from feedstock Propylene Oxide further contributed to the equilibrium in Polyol prices.
In the middle of the third quarter, Polyol production rates were hampered because of the stressed availability of feedstocks in the region. The offtakes were moderate, and market players raised their quotations marginally, however the market dynamics remain stable.
With a percentage change of -24% from the same quarter last year and no change from the previous quarter in 2024, the market exhibited a sense of stability. The price remained constant between the first and second half of the quarter, indicating a lack of significant fluctuations. The quarter-ending price of USD 2140/MT of Polyether Polyol MW 3000, µ 400-650 FOB Texas in the USA reflected the prevailing stable pricing sentiment in the region.
APAC
In Q3 2024, the Polyol market in the APAC region has been characterized by a fluctuating pricing environment. The quarter has witnessed significant influences from several factors such as increased upstream Propylene costs due to fluctuating crude oil prices, moderate demand from downstream industries, and improved manufacturing activities. The market's dynamics were further complicated by supply chain disruptions and geopolitical tensions affecting crude oil imports, leading to variable feedstock availability. During the mid-quarter, the looming concerns about a recession in the US affected the international crude oil market and refinery operation. It stressed the upstream Propylene supplies and Polyol production rates. Polyol prices fluctuated and rose marginally, and the price comparison between the first and second half of the quarter showed a negative change of 1%. Towards the end of the quarter, the increased availability of feedstock Propylene oxide supplies, driven by improved refinery operations and Crude Oil availability amid a resumption of Crude Oil supply from Libya in September 2024, negatively impacted the production costs. Simultaneously, offtakes for moderately low from the PU segment during the period. Conclusively, from the previous quarter in 2024, prices fell by 8%, indicating a downward trend. Polyether Polyol MW 3000 FOB-Osaka prices in Japan settled at USD 1230/MT at the end of quarter 3 of 2024.
Europe
During the third quarter of 2024, the European Polyol market was driven predominantly by a confluence of factors impacting supply and demand dynamics. Throughout the quarter, the sluggish demand from the downstream industries, particularly polyurethane manufacturers, due to reduced construction activities and a shift towards bio-based materials negatively influenced the market dynamics. Moreover, the oversupply situation, exacerbated by cautious purchasing behavior amid rising inflation and economic uncertainties, further pressured prices. The automotive sector, traditionally a significant consumer of polyurethane products, also contributed to the weakened demand as vehicle sales remained subdued. Additionally, the manufacturing sector faced challenges, with the Eurozone Manufacturing PMI indicating declining new orders and rising costs, further dampened demand. Supply-side dynamics also played a role, as supply availability improved post-summer holidays, yet demand failed to match this increase, exacerbating inventory levels. Seasonality played a crucial role, as the summer holidays typically result in reduced industrial activities, subsequently decreasing demand. Consequently, the first and second half of the quarter saw a 4% decrease, reflecting a consistent negative pricing environment throughout the period. The quarter concluded with a Polyether MW 3000, µ 400-650 FOB Hamburg price at USD 1560/MT in Germany, after an overall 11% drop from the last quarter's prices, underscoring the negative sentiment pervading the Polyol market, driven by both external economic pressures and internal market dynamics.
For the Quarter Ending June 2024
North America
In Q2 2024, the North American Polyol market saw fluctuating prices due to several converging factors. A significant drop in demand from the construction sector, coupled with ample supply levels, has exerted downward pressure on prices. The slowdown in the construction industry has led to reduced consumption of PU materials made from Polyol. Additionally, the sluggish performance of the automotive sector has further decreased offtakes, contributing to the decline in prices. Feedstock prices, particularly Propylene Oxide, have remained relatively low, offering minimal cost support to Polyol producers.
In the USA, where price volatility was most pronounced, the overall trend has been consistently negative. Seasonal factors also played a role; anticipated increases in demand during the monsoon season for PU sole footwear did not materialize, further suppressing prices. The relationship between upstream feedstock prices and Polyol prices remained strong, with minor fluctuations in Propylene Oxide costs reflected in Polyol pricing. Compared to the same quarter last year, Polyol prices plummeted by 35%, indicating significant overcapacity and subdued demand. Prices also fell by 1% from the previous quarter in 2024, demonstrating ongoing bearish sentiment. The first half of Q2 saw a sharper decline of 5% compared to the latter half, highlighting the continued weakening of market conditions as the quarter progressed.
By the end of Q2 2024, Polyether Polyol MW 3000, µ 400-650 FOB Texas was priced at USD 2140/MT. This substantial decrease reflects a predominantly negative pricing environment, driven by weak demand, sufficient supply, and stable yet low feedstock costs. The overall sentiment remains negative, with little prospect for a near-term recovery without a significant increase in market demand.
APAC
In the second quarter of 2024, Polyol pricing in the APAC region experienced notable shifts due to a combination of economic and sectoral factors. The market saw increased volatility, primarily due to subdued demand from the construction and automotive industries, which are crucial to Polyol consumption. This decline in demand was worsened by an oversupply, with manufacturers struggling with excess inventory due to inconsistent offtake rates. Additionally, fluctuations in upstream Propylene and Naphtha costs, essential for Polyol production, added downward pressure on prices. Overall, the sentiment was negative as market participants dealt with supply chain uncertainties and varying input costs. In Japan, the most significant price changes were observed. Seasonal factors, including lower demand during off-peak months and reduced construction activity, heavily impacted the Polyol market. Prices in Japan dropped sharply, with a 9% decrease compared to the same quarter last year, highlighting a broader market contraction. From the previous quarter in 2024, prices fell by 3%, reflecting ongoing bearish sentiment throughout the period. A comparison of the first and second halves of the quarter revealed a 9% price drop, indicating a steady decline in market momentum. By the end of the quarter, Polyether Polyol MW 3000 FOB-Osaka was priced at USD 1260/MT, underscoring the overall negative trend. This pricing environment reflects a challenging quarter for Polyol, marked by negative market forces, supply-demand imbalances, and raw material cost volatility.
Europe
In Q2 2024, the Polyol price trend in Europe fluctuated, with notable shifts occurring mid-quarter. Initially, prices were stable with a slight increase due to reduced production rates from limited feedstock supplies. However, demand from the Polyurethane segment remained weak. Mid-quarter, a reduction in geopolitical tensions in the Middle East and improved feedstock availability revitalized manufacturing activities in the region. Despite this, subdued demand from key end-use sectors, particularly construction and automotive industries, remained a significant factor. The construction sector faced prolonged downturns due to declining investment sentiment, while the automotive sector experienced a notable drop in car sales, leading to decreased consumption of Polyurethane materials. Additionally, an ample supply of feedstock Propylene Oxide, driven by reduced offtakes from regional Glycol manufacturers, further pressured Polyol production costs downward, resulting in an oversupplied market with stagnant demand. Germany saw the most significant price changes within the region. The overall trend was marked by a bearish sentiment, influenced by seasonal factors and economic conditions. The ongoing decline in automotive sector consumption was a key factor, with manufacturing and new orders contracting more than expected. Compared to the same quarter last year, Polyol prices plummeted by a staggering 35%, reflecting broader market struggles. Prices remained stable from the previous quarter, showing no percentage change, indicating that the market had adjusted to lower demand levels. However, a closer examination reveals a 6% price decline between the first and second halves of the quarter, highlighting a consistent weakening trend. By the end of Q2 2024, Polyether MW 3000, µ 400-650 FOB Hamburg in Germany was priced at USD 1760/MT. The pricing environment remained decidedly negative, driven by market oversupply and waning demand, resulting in a significantly bearish outlook for the Polyol market in Europe.
For the Quarter Ending March 2024
North America
The Polyol price trend remain weak in the North American market during the first quarter of 2024 when compared with the previous one. At the beginning of the quarter, the demand for Polyol was moderately low during the New Year holidays and firm availability of stocks in the market. However, orders increased from the Polyurethane segment after the holidays as the furniture industry saw a surge in sales due to Presidents' Day deals and increased demand for painted furniture and cabinets. Simultaneously, the inquiries surged for energy-efficient products in the refrigeration industries.
During the mid-quarter, prices inclined the orders for Polyurethane component Polyol rose in the Polyurethane segment amid a rise in demand from the construction sector for stocking purposes amid the anticipation of the revival of construction activities in the North American region with the arrival of spring. Simultaneously, feedstock supplies were affected as the LyondellBasell in Bayport Texas, with a feedstock Propylene Oxide production capacity of 60,000 MTPA, went under force majeure on 3rd Feb 2024 and impacted the production rates of the product. Additionally, the energy sector witnessed surges in energy costs due to geopolitical tensions and positive economic data, which caused escalations in the production costs of Polyol.
Towards the end of the quarter, Polyol prices continued to showcase bullish movement in the USA as orders were firm from the buyers due to the steady demand for Polyurethane components in the manufacturing and construction sectors. In the refrigerators and freezers (cold chain) sector, consumers complained of fridges dying young, which caused a surge in demand for Polyol for repair and replacement objectives. At the end of the quarter, Polyether Polyol MW 3000, μ 400-650 FOB Texas in the USA witnessed USD 2240/MT.
APAC
In the first quarter of 2024, the Polyol price trend showcased bullish movement in the APAC region. At the beginning of Q1, prices inclined as demand from the Polyurethane segment escalated amid a surge in the production of electric vehicles in the automotive industry. Simultaneously, supply rates were impacted amid disruptions due to natural disasters like the earthquake and tsunami in Japan. Simultaneously, demand improved for stocking purposes before the Lunar New Year holidays in major isocyanate producers in China. During the mid-quarter operation, rates were low at manufacturing units due to affected production rates of feedstock Propylene Oxide because of the tight availability of upstream Propylene due to limited supplies of Crude Oil from Middle East exporters amid the geopolitical conflicts and trade problems through the sea routes. At the same time, the major Polyol market in China was closed during the Lunar New Year holidays from 2nd February 2024 till 18th February 2024. As a result, Polyol prices escalated amid sluggish trading activities and firm demand from buyers like India due to consistent market offtakes during the wedding season and firm consumption of PU materials from the automotive and manufacturing sectors. However, operating rates and trading activities improved after the reopening of the Chinese market. Towards the quarter's end, the air cargo market witnessed increased demand for the third consecutive month in March, fuelled by the expansion of e-commerce and shipping disruptions in the Red Sea, impacting air freight rates and product supplies in the international market amidst moderate demand from buyers. At the end of the first quarter of 2024, Polyether Polyol MW 3000 FOB-Osaka quotations in Japan settled at USD 1360/MT.
Europe
In the first quarter of 2024, the European Polyol market experienced trends akin to those observed in the North American region. Initially, supply chain delays and extended lead times hindered the availability of supplies within the regional market. However, demand was moderate for Polyurethane (PU) component Polyol as orders for PU foam in the manufacturing sector witnessed declines amid the increase in production costs of wood furniture in the region. It caused a slight reduction in the Polyol market prices. During the mid-quarter, the production rates were affected by elevated energy costs and limited access to Propylene Oxide feedstock, exacerbated by delayed supplies of upstream Propylene from the US exporters due to trade problems through the Suez Canal. Simultaneously, uncertainties regarding energy security in Europe arose, influenced by a pause in US LNG exports, impacting variable costs across industries. The automotive sector continued to witness heightened demand for lightweight PU materials derived from Polyols, attributed to the growing production of electric vehicles. Towards the quarter's conclusion, regional manufacturing units grappled with disruptions to production schedules due to a shortage of skilled labor. It resulted in diminished output rates and escalated operational costs. Additionally, global air cargo demand experienced its third consecutive monthly increase in March, driven by the expanding e-commerce sector and disruptions in shipping routes, particularly in the Red Sea region, leading to fluctuations in air freight rates. Consequently, Polyol prices trended upwards again by the quarter's end, with Polyether MW 3000, μ 400-650 FOB Hamburg in Germany assessed at USD 1920/MT.
