For the Quarter Ending September 2024
North America
In Q3 2024, the North American Stearic Acid market experienced a steady increase in prices, driven by several key factors. Rising production costs in Southeast Asia, particularly due to concerns over palm oil production in major exporting countries, contributed to higher import costs for Stearic Acid.
Additionally, elevated freight charges and port congestion further impacted North American market prices. In Southeast Asia, particularly Malaysia and Indonesia, supplies of Stearic Acid were constrained by a shortage of palm oil. In Malaysia, palm oil prices surged by approximately 11% in late September 2024, following a 3.8% decline in production to 1.82 million tonnes. Further seasonal declines were anticipated, leading to a domestic shortage of Stearic Acid and increasing prices. In Indonesia, palm oil production fell by 2% in August 2024, exacerbating the supply issues. The government's decision to raise the palm oil content in biodiesel from 35% to 40% increased demand, further pushing palm oil prices up globally. Exports of palm oil products also dropped significantly, from 3,385 thousand tonnes in July to 2,241 thousand tonnes in August 2024, fueling the rise in Stearic Acid prices across the global market. Mexico saw notable price changes, with a 10% increase compared to the same quarter last year and a 4% rise from the previous quarter in 2024. A 2% price difference between the first and second halves of the quarter indicated a steady upward trend.
The quarter ended with Stearic Acid Rubber Grade priced at USD 1,425/MT CFR Veracruz. Overall, the pricing environment for Stearic Acid in North America during Q3 2024 reflected a significant upward trajectory.
South America
Throughout Q3 2024, the Stearic Acid market in South America experienced a significant uptrend in pricing, driven by multiple factors influencing the market dynamics. The 11% increase in prices from the same quarter last year was primarily propelled by rising feedstock costs, particularly in Southeast Asia. Factors such as reduced palm oil exports, production constraints, and port congestions in exporting countries contributed to the heightened production costs of Stearic Acid in the region. In Southeast Asia, particularly Malaysia and Indonesia, supplies of Stearic Acid were constrained by a shortage of palm oil. In Malaysia, palm oil prices surged by approximately 11% in late September 2024, following a 3.8% decline in production to 1.82 million tonnes. Further seasonal declines were anticipated, leading to a domestic shortage of Stearic Acid and increasing prices. In Indonesia, palm oil production fell by 2% in August 2024, exacerbating the supply issues. The government's decision to raise the palm oil content in biodiesel from 35% to 40% increased demand, further pushing palm oil prices up globally. Exports of palm oil products also dropped significantly, from 3,385 thousand tonnes in July to 2,241 thousand tonnes in August 2024, fueling the rise in Stearic Acid prices across the global market. Brazil witnessed the most substantial price changes, with a 4% increase from the previous quarter and a 2% price difference between the first and second half of Q3 2024. This trend indicates a steady rise in prices throughout the quarter, showcasing a positive pricing environment. The quarter-ending price of USD 1445/MT of Stearic Acid Rubber Grade CFR Santos in Brazil reflects the overall bullish sentiment in the market, driven by sustained demand, supply challenges, and external market influences.
APAC
In Q3 2024, the APAC region experienced a significant 16% increase in Stearic Acid prices compared to the same quarter last year, driven by multiple factors. Rising feedstock Palm Oil prices, up by 6% from the previous quarter, played a crucial role in influencing market prices. The region saw a 3% price increase from the first to the second half of the quarter, indicating a steady upward trend. In Southeast Asia, particularly Malaysia and Indonesia, supplies of Stearic Acid were constrained by a shortage of palm oil. In Malaysia, palm oil prices surged by approximately 11% in late September 2024, following a 3.8% decline in production to 1.82 million tonnes. Further seasonal declines were anticipated, leading to a domestic shortage of Stearic Acid and increasing prices. In Indonesia, palm oil production fell by 2% in August 2024, exacerbating the supply issues. The government's decision to raise the palm oil content in biodiesel from 35% to 40% increased demand, further pushing palm oil prices up globally. Exports of palm oil products also dropped significantly, from 3,385 thousand tonnes in July to 2,241 thousand tonnes in August 2024, fueling the rise in Stearic Acid prices across the global market. Japan, in particular, witnessed the highest price changes in the region. The market displayed notable seasonality trends, with prices reflecting a consistent increase. The correlation between rising Palm Oil costs and Stearic Acid pricing was evident, with a stable and positive pricing environment prevailing throughout the quarter. The quarter-ending price of Stearic Acid Rubber CFR Tokyo in Japan stood at USD 1170/MT, underscoring the overall positive pricing sentiment in the region. The market dynamics were predominantly driven by the incremental costs of production inputs, signaling a stable and optimistic outlook for the Stearic Acid market.
Europe
During Q3 2024, the Stearic Acid market in Europe experienced a notable shift in pricing dynamics, marked by a 1% increase from the same quarter last year. Factors influencing this uptick included rising feedstock Palm Oil costs in exporting regions, such as Southeast Asia, leading to heightened production expenses. Additionally, high freight charges contributed to the expensive inventories entering the European market, further driving up prices. The negative correlation of -7% from the previous quarter in 2024 highlighted the volatility in pricing trends. In Southeast Asia, particularly Malaysia and Indonesia, supplies of Stearic Acid were constrained by a shortage of palm oil. In Malaysia, palm oil prices surged by approximately 11% in late September 2024, following a 3.8% decline in production to 1.82 million tonnes. Further seasonal declines were anticipated, leading to a domestic shortage of Stearic Acid and increasing prices. In Indonesia, palm oil production fell by 2% in August 2024, exacerbating the supply issues. The government's decision to raise the palm oil content in biodiesel from 35% to 40% increased demand, further pushing palm oil prices up globally. Exports of palm oil products also dropped significantly, from 3,385 thousand tonnes in July to 2,241 thousand tonnes in August 2024, fueling the rise in Stearic Acid prices across the global market. In the Netherlands, the market witnessed the most significant price changes, with a 3% difference between the first and second half of the quarter. This fluctuation indicates a period of instability and uncertainty in pricing. The quarter-ending price of USD 1553/MT of Stearic Acid Rubber Grade CFR Rotterdam in the Netherlands reflects the overall increasing sentiment in the market, showcasing a positive trajectory despite the challenges faced. The pricing environment in Q3 2024 has been characterized by a notable upward trend, influenced by various supply and demand dynamics impacting the Stearic Acid market in Europe.
For the Quarter Ending June 2024
North America
In the second quarter of 2024, the North American market for Stearic Acid saw a notable decline, driven by several key factors. Reduced demand from the automotive and rubber industries, ongoing disruptions in supply chains, and fluctuating prices of Palm Oil, which dropped around 9% in May 2024, collectively pushed Stearic Acid prices lower. The underperformance of the automotive sector, particularly in electric vehicles (EVs), exacerbated this trend. Geopolitical tensions and logistical issues in major shipping routes also contributed to increased freight costs, further impacting market conditions.
In the USA, where the market experienced the most significant price fluctuations in the region, the overall trend for the quarter was predominantly negative. Prices declined by 1% compared to the previous quarter of 2024 and showed a 1% reduction between the first and second halves of Q2 2024. Year-over-year prices remained stable, highlighting a recent softening in market demand and supply dynamics despite stability in annual comparisons.
Seasonal factors, such as reduced demand for summer tires, also influenced the downward trajectory of Stearic Acid prices. The close correlation between automotive sector fluctuations and Stearic Acid pricing underscored its crucial role in rubber manufacturing. Despite efforts to stabilize inventories, market sentiment remained negative, culminating in a quarter-ending price of USD 1280/MT for Stearic Acid Rubber Grade CFR New York. This consistent decline indicates a challenging pricing environment shaped by external economic factors and specific industry conditions.
APAC
In the second quarter of 2024, Stearic Acid prices in the APAC region experienced a predominantly positive trend, driven by several key factors. A stable yet variable cost of palm oil, the primary feedstock, influenced by moderate production expenses and global supply chain disruptions, served as the primary catalyst. Additionally, congestion at critical Asian trade routes like the Strait of Malacca and Singapore port led to a more than 50% increase in freight charges, further boosting Stearic Acid prices. Despite sluggish demand from downstream industries, notably the automotive sector due to the Daihatsu safety test scandal halting production earlier in the year, prices remained stable midway through the quarter.
Japan, experiencing the most significant price fluctuations, saw market dynamics heavily influenced by heightened freight costs and a weakened Japanese Yen, which depreciated nearly 10.25% against the USD in the first five months of 2024. Seasonal patterns typically result in subdued summer demand, but increased input expenses and renewed manufacturing optimism balanced this effect. Compared to the same period last year, Stearic Acid prices rose by 6%, indicating strong market fundamentals. Sequentially from the previous quarter in 2024, prices increased by 5%, reflecting a sustained upward trajectory. Intra-quarterly volatility was slight, with a 2% price difference between the first and second halves of the quarter.
As the quarter concluded, Stearic Acid Rubber CFR Tokyo recorded a price of USD 1100/MT, marking a culmination of consistent price hikes. Overall, the pricing environment in Japan during Q2 2024 was bolstered by higher input costs, logistical challenges, and strategic market responses, fostering a generally optimistic market sentiment.
Europe
Throughout the second quarter of 2024, the European market for Stearic Acid saw prices decline persistently. This trend, amounting to approximately 10.2%, was primarily driven by weak demand from the automotive industry despite facing challenges such as port congestions and strikes at German ports. Fluctuations in Palm Oil prices, which dropped about 9% in May and continued to vary in June, played a significant role in reducing production costs.
Germany, notably affected within the European market, experienced the most significant price fluctuations. Prices showed an overall negative trend, declining by 1% compared to the same quarter last year and by 4% compared to the previous quarter in 2024. The first half of Q2 saw a more pronounced decline of 6%, reflecting an increasingly pessimistic market sentiment.
Environmental disruptions, such as floods in Northern Europe and congestion at key Southeast Asian ports, exacerbated oversupply issues, further pushing prices downward. Despite improvements in the broader automotive sector, particularly in electric vehicles, reduced sales led to higher inventory levels. This surplus improved material availability among German suppliers and shortened delivery lead times.
Despite seasonal fluctuations typical in the European market, Stearic Acid prices in Germany consistently trended lower, culminating in a quarter-ending price of USD 1530/MT for Rubber Grade CFR Hamburg. This sustained decline underscores a challenging pricing environment influenced by complex market dynamics and external economic pressures.
South America
In the second quarter of 2024, Stearic Acid prices in South America experienced a notable decline, reflecting a tough market environment. Several factors contributed to this downward trend. The decrease in Palm Oil prices. Which depreciated by approximately 9% during May 2024 across Southeast Asia played a crucial role by lowering production costs, thereby influencing Stearic Acid prices. Additionally, disruptions in supply chains, seasonal variations, and decreased demand from various industries all contributed to the overall price decrease.
Brazil, which saw the most significant price changes in the region, reported a 4% decrease compared to the same quarter last year, and a 2% decrease from the previous quarter in 2024. The latter half of the quarter showed a further 1% decline compared to the first half. The quarter-end price for Stearic Acid Rubber Grade CFR Santos in Brazil was USD 1370/MT, reflecting the consistently negative pricing trend observed throughout the quarter.
This sustained price decline underscores the challenging conditions and bearish sentiment prevailing in the Stearic Acid market in South America during Q2 2024. Despite efforts to mitigate factors like supply chain disruptions and seasonal fluctuations, the market continued to face pressures that impacted pricing dynamics significantly.
For the Quarter Ending March 2024
North America
During the first quarter of 2024, the Stearic Acid market in North America displayed a combination of price fluctuations and stability. Prices saw a general upward trend across the region, driven by several factors. In the United States, prices rose by approximately 1% due to a scarcity of Palm Oil, heightened demand from the domestic Indonesian market, and strong automotive sector demand. The US market saw support from a 17% increase in automotive sales and robust demand from the summer tire sector. Elevated freight charges further impacted prices.
Limited supplies, disruptions in the supply chain due to truck driver protests, and rising Palm Oil prices also influenced the market. Automotive sector demand remained moderate, with a 22% decline in automotive sales noted in January 2024. However, nearshoring initiatives and positive sentiments during the festive season partly buoyed demand.
Overall, the Stearic Acid pricing environment in North America during Q1 2024 showed relative stability with some fluctuations. Prices mostly trended upwards, albeit with variations across markets. The market dynamics were shaped by factors such as feedstock costs, automotive sector demand, and supply chain disruptions. Despite the overall positive trajectory, demand levels varied, contributing to a more balanced market landscape.
Asia
The first quarter of 2024 brought a mix of trends for Stearic Acid pricing in the APAC region, characterized by overall stability with notable influences on market dynamics. Fluctuations in Palm Oil prices, the primary raw material for Stearic Acid production, played a significant role in shaping prices. Increasing Palm Oil costs, driven by factors like poor cultivation and high demand from the Biodiesel sector, elevated production expenses for Stearic Acid, consequently impacting prices upward. Furthermore, demand from downstream industries like automotive, soap and detergent, and rubber sectors also influenced Stearic Acid pricing. Automotive sector demand varied across regions, with some witnessing sales rebounds while others experienced slowdowns. Similarly, the soap and detergent industry's demand was subject to seasonal shifts, particularly with the conclusion of the winter season. Despite these factors, the overall pricing environment for Stearic Acid in the APAC region during Q1 2024 remained stable, albeit with some fluctuations due to supply and demand dynamics. Notably, in South Korea, there were notable price changes for Stearic Acid during the quarter. While prices exhibited a positive trend compared to the same period last year, there was a slight decline compared to the previous quarter in 2024, indicating market stabilization. The latest quarter-ending price for Stearic Acid (Rubber grade) CFR Incheon in South Korea stood at USD 1286/MT. Overall, the pricing environment for Stearic Acid in South Korea during Q1 2024 showed positivity with an annual increase, coupled with indications of market stabilization in the shorter term.
Europe
Throughout the first quarter of 2024, Stearic Acid prices in the European market exhibited some fluctuations. Overall, the pricing landscape for Stearic Acid remained relatively stable, with moderate demand observed from the automotive and soap and detergent sectors. In February 2024, Stearic Acid prices in the Netherlands saw a slight uptick of approximately 2%. This increase can be traced back to costly imports from Malaysia, where Stearic Acid prices rose by a similar margin. The escalation in Malaysian prices was primarily driven by heightened production costs stemming from increased Palm Oil prices. Moreover, delays in cargo arrivals due to the Red Sea crisis further exacerbated supply conditions in the Netherlands. Despite the market's overall stability, the Dutch Stearic Acid sector faced challenges posed by constrained supplies and rising production expenses. Automotive sector demand remained moderate, buoyed by an uptick in electric vehicle sales. However, demand from the soap and detergent industry waned due to seasonal factors, notably the peak winter season. Analyzing price trends, Stearic Acid prices in the European market showed an increase compared to the same quarter of the previous year. Nevertheless, there was a slight dip in prices compared to the preceding quarter in 2024. In summary, the pricing environment for Stearic Acid in Europe during Q1 2024 was characterized by stability alongside moderate demand. The Netherlands witnessed a marginal price increase, driven by costly imports and constrained supplies.
South America
During the opening quarter of 2024, the Stearic Acid market in South America remained bullish, with prices experiencing an overall increase of approximately 5% during this period. This upward trend was primarily driven by the scarcity of Palm Oil, a key feedstock sourced from Southeast Asia, which escalated production costs across the region. Additionally, disruptions at major waterways resulted in heightened freight costs, leading to the arrival of costly inventories in the South American market. Despite initially low demand in the Brazilian market, marked by an 11% decline in automotive sales, sentiments gradually shifted. In February, automotive sales saw a modest increase of around 2%. Furthermore, in March 2024, a leading automotive player in Brazil announced plans to invest approximately EUR 56.4 million in hybrid vehicle manufacturing, fostering a positive outlook. Overall, the South American Stearic Acid market remained influenced by the limited availability of Palm Oil, attributed to factors such as poor farming practices, aging Palm trees, and high demand for Biodiesel. These factors contributed to increased production costs of Stearic Acid and the influx of expensive inventory into the South American market. Moreover, internal logistical challenges, including seasonal rainy weather and delays in ship arrivals, further elevated prices of Stearic Acid.
For the Quarter Ending December 2023
North America
The North American market for Stearic Acid in the fourth quarter of 2023 witnessed several key factors that influenced prices. Firstly, the market experienced a bearish trend, with high supply levels due to inexpensive imports from Malaysia and increased production costs in the country.
Additionally, the festive season in December led to an increase in demand from the downstream winter tire and automotive industry. However, the demand from the automotive sector was uncertain, dependent on economic conditions and the growth of electric vehicle sales. Looking at the performance of Stearic Acid prices in the North American market, there was a 4% decrease from the previous quarter (Q3) to the current quarter (Q4) of 2023.
This decline can be explained by the bearish market sentiment and the aforementioned factors affecting supply and demand dynamics. The market situation of Stearic Acid also witnessed the impact of nearshoring activities in Mexico where automotive manufacturers continued setting up bases in Mexico as input costs remained at an all-time high.
APAC
The APAC region witnessed an overall stable market situation in the prices of Stearic Acid throughout the 4th quarter of 2023. The stable supply of Stearic Acid from exporting countries like Indonesia and Malaysia contributed to the overall market situation. Despite the depreciation of prices in the feedstock Palm Oil, the demand for Stearic Acid remained high, especially from the winter tire sector in the West. This increased demand helped to maintain stable prices in the market. Among the countries in the APAC region, South Korea experienced a significant appreciation of its currency, the South Korean Won, by 4.17% against the USD in November. This currency fluctuation may have impacted on the pricing of Stearic Acid in the country. The trend, seasonality, and correlation of Stearic Acid prices in South Korea during this quarter were not provided in the information. Looking at the price comparison, there was no mention of the percentage change in prices from the same quarter of the previous year. However, the information states that there was a 5% decrease in prices from the previous quarter of 2023. In summary, the APAC region experienced a stable supply and moderate prices for Stearic Acid in the current quarter of 2023. The high demand from the winter tire sector in the West and stable supplies from Indonesia and Malaysia contributed to the stable prices. South Korea saw a significant appreciation in its currency, which may have impacted the pricing of Stearic Acid in the country. The specific trends, seasonality, and correlations of prices in South Korea were not provided. The latest price of Stearic Acid (Rubber grade) CFR Incheon in South Korea for the current quarter is USD 1327/MT.
Europe
The fourth quarter of 2023 for Stearic Acid in the European region was characterized by various factors that influenced the market and prices. Firstly, there was a moderate demand for Stearic Acid, primarily driven by the winter tire industry due to the progressing winter season. Additionally, the overall declining industrial activities called for shorter sizes of inventories, resulting in higher prices. However, the demand from the downstream automotive industry was only moderate, with automotive sales in the Netherlands showing no significant changes. In terms of supply, inventories were recorded to be low, as smaller sizes were placed in the exporting market. No plant shutdowns were reported during this period. One country that experienced notable changes in prices was the Netherlands. The prices of Stearic Acid (Rubber Grade) in Rotterdam witnessed a marginal inclination of approximately 1.3% in the Dutch market. This increase can be attributed to the moderate demand from the winter tire industry and the overall competitiveness of the market. However, it is important to note that the cosmetic grade of Stearic Acid remained subdued as the winter season progressed. In terms of price trends, the selected country of the Netherlands saw a 14% decrease in prices compared to the same quarter of the previous year. The price change from the third quarter to the fourth quarter of 2023 was 1%, indicating a slight increase. In conclusion, the European market for Stearic Acid in the fourth quarter of 2023 was influenced by factors such as moderate demand from the winter tire industry, declining industrial activities, and low supply of the product. The Netherlands experienced a slight increase in prices, with the cosmetic grade remaining subdued. The price trend in the selected country showed a decrease compared to the previous year, a slight increase from the previous quarter, and no available comparison for the first and second half of the quarter. The latest price of Stearic Acid (Rubber Grade) in Rotterdam, Netherlands, for the current quarter is USD 1581/MT.
South America
The South American market for Stearic Acid largely witnessed a mixed market situation during the fourth quarter of 2023. Initially prices of the product were largely driven by low prices of inventories from the exporting Malaysian and Indonesian markets as prices of feedstock Palm Oil were recorded to have largely subdued, easing production costs. The demand from the downstream rubber sector of the construction and automotive industry was recorded to have largely subdued which compelled the depreciation of prices of the product as existing inventories were simply not being consumed. However, towards the end of 2023, the market for Stearic Acid witnessed a bullish situation as demand from the electric automotive industry increased as investment sentiments turned positive. This was particularly evidenced by increased funding for setting up manufacturing bases to improve investment sentiments. This also moderately improved the construction industry in Brazil which consequently also increased the demand from the secondary construction industry. However, trading activities remained largely cautious as freight charges soared with most freight companies being likely to hike base fares.
For the Quarter Ending September 2023
North America
Prices of Stearic Acid witnessed a marginally bullish situation in the third quarter of 2023, with prices appreciating by approximately 1%. The prime reason for the increment in the prices was attributed to the rising costs of feedstock Palm Oil, which also appreciated by approximately 2% in the exporting Asian market from where Stearic Acid is largely imported into North America. Demand from the downstream sectors improved marginally as automotive sales soared in September 2023, with an appreciation of almost 19% being recorded towards the termination of the third quarter of 2023. Demand from the downstream PVC industry was also healthy as PVC prices also appreciated by more than 8% in the North American market. Therefore, a healthy demand coupled with rising feedstock costs led to an overall appreciation in the prices of the product. Moreover, because of continuous hikes in the interest rates by the Federal Bank, output charges and port charges have also been reported to have increased, and inflation rates currently stand at more than 4%.
APAC
Prices of Stearic Acid witnessed an overall bearish situation in the Asian market, with prices declining by more than 3% in the first half of the 3rd Quarter and then again marginally increasing by almost 1% in the second half of the 3rd Quarter. Overall, prices of Stearic Acid in the Asian market witnessed a depreciation of approximately 3% In the third quarter, despite prices of feedstock Palm Oil inclining by almost 2%. Demand from the downstream automotive industry was largely low as automotive production dropped by almost 15% in the third quarter of 2023. Moreover, demand from the downstream soap industry was mixed as the effects of El Nino produced uneven rainfall across South and East Asia, which also impacted feedstock Palm Oil production. This consequently led to mixed purchasing sentiments in the soap industry. The mixed purchasing sentiments of the downstream soap industry led to moderate rates of consumption, which detrimentally affected the prices of the product.
Europe
Prices of Stearic Acid in the European market witnessed a largely mixed trend, with prices initially depreciating by almost 1.5% in the first half of the 3rd Quarter of 2023 and then again inclining by almost 2% in the next half of the 3rd Quarter. This mixed trend overall produced a marginally bullish trend where prices of Stearic Acid increased by almost 0.4% in the third quarter of 2023. Demand from the construction industry was not present in Europe, as PVC prices declined by almost 5%. Secondly, inflation rates in Germany soared, reaching above 6% in August before cooling to 4.5% in September, which restricted consumer purchasing activities as per requirement. Moreover, increasing prices of feedstock Palm Oil across the exporting South Asian market consequently led to fewer orders of imports placed as the recessionary conditions prevailed across Europe, which also kept trade activities at a moderate level. Overall, prices of Stearic Acid in the European market are expected to remain subdued as the fall season nears.
South America
Prices of Stearic Acid have remained largely stable in the South American market as moderate inventories of imports existed within the region in the face of moderate demand in the third quarter of 2023. The main reason for the overall stability in the prices was attributed to the maintenance of an adequate gap between demand and supply, which consequently compelled prices not to show any fluctuations throughout the 3rd Quarter of 2023. Rising production costs across the Southeast Asian market compelled merchants to place orders of import as per requirement. Demand from the downstream Automotive industry was also recorded to be moderate. Purchasing sentiments were also recorded in the downstream soap manufacturing industry, because of which prices did not show any fluctuations. Most of the economic indicators showed moderate results, with industrial activities again contracting after the seventh consecutive month of expansion. Prices are expected to remain subdued as uncertainties in the production of Palm Oil looms across the exporting Southeast Asian market.
For the Quarter Ending June 2023
North America
The prices of Stearic Acid experienced an overall downward trend during the second quarter of 2023, governed by the low demand within the rubber industry and cosmetics sector of the region. The challenging global economic conditions and various market financial growth restrictive factors further contributed to decreased sales and profits for the traders during this period. Additionally, the downstream industry faced its own set of challenges in the first half of the quarter, grappling with disruptions in the supply chain and inflationary pressures. Major Stearic Acid market players encountered supply-related issues, nevertheless, the demand for Stearic Acid remained subdued amidst rising interest rates in the US market. The Federal Reserve's decision to raise interest rates at the beginning of the quarter aimed at curbing inflation in the United States played a significant role in dampening demand in several downstream sectors and ultimately influencing the discussion around Stearic prices in the US market. In addition, the final change in the Stearic Acid price trend has also resulted from the fall in the upstream Palm oil prices this quarter.
APAC
During the second quarter of 2023, Stearic Acid prices in the Asia-Pacific (APAC) market remained relatively stable with minimal changes. Recent data indicates that the rubber industry in the region faced lackluster demand, causing concerns among market participants. The economic situation in China also contributed to the subdued domestic market, as consumer enthusiasm remained dampened due to sluggish conditions. Additionally, slow offshore trading activities further pushed Stearic Acid prices downward. The price stagnancy of Stearic Acid during the mid of quarter resulted from the main factors, firstly, the volatility in upstream palm oil prices had an impact, and secondly, there was a lower availability of inventories. Responding to the bearish market conditions in the latter half of the quarter, manufacturers decided to reduce their production run rates, which in turn affected prices by lowering inventory stockpiling for the commodity. The downstream processing industry faced setbacks after the Holiday season in the first half of the second quarter, exacerbating the overall market situation. Moreover, export demand decreased, and rising interest rates had negative impacts on the rubber and cosmetics sector across the region. Traders also encountered an oversupplied market since the Labor Day Holidays in May 2023, compounded by the drop in crude oil costs and feedstock prices. In conclusion, the combination of weak demand, external economic factors, and oversupply in the market led to a downward trend in Stearic Acid prices for the APAC region during the quarter ending June 2023.
Europe
Throughout the second quarter of 2023, the European market witnessed a general lack of growth in Stearic Acid prices due to reduced demand in the downstream rubber industry and cosmetics sector along with an abundance of inventories. The rubber industry faced a notable decline in offers, while increased inventories were a result of rising interest rates by the European Central Bank, which limited consumer spending during the entire quarter. To address the challenging financial climate, market participants closely monitored the situation and implemented various strategies to navigate the downturn. These measures included scaling back production rates, optimizing expenses, and ensuring a stable supply chain. Additionally, the decrease in upstream Palm oil prices also contributed to the overall decrease in Stearic Acid prices during this period. Meanwhile, the global economic slowdown had lasting impacts, leading to constrained investments, heightened debt vulnerabilities, and funding shortages in the regional market. Consequently, the demand for Stearic Acid in the downstream sector significantly decreased. As of the end of June 2023, Stearic Acid prices experienced a monthly decline of approximately 2%.
For the Quarter Ending March 2023
North America
In the US market for Stearic Acid during Q1 2023, sluggish procurement from the end-use cosmetic, food, and pharmaceutical industries has resulted in a pessimistic market trend. The pressure on input costs has begun to lessen, and the product was widely available in the domestic market. The market transactions were also average, and the price of Stearic Acid has remained below zero. The severe economic conditions brought on by the failure of two banks, Silicon Valley and Signature Bank, have compounded the market downturn of the detergent sector this month. Manufacturers have reduced their offers as a result. Additionally, according to market sources, the data shows that the cost of shipping goods from the United States to Asian markets like South Korea and India has decreased significantly.
APAC
The price of Stearic Acid continued to decline throughout the first quarter. Stearic Acid prices have not increased despite improvements in the manufacturing industry across the Chinese market. The market participants have stated that this continuous price reduction was due to the buildup of stocks and the moderate demand from the downstream cosmetic, food, and pharmaceutical industrial sector. Overall, despite abundant supply in the exporting countries, cost assistance from upstream palm oil was insufficient. Additionally, the increased availability of containers and the decline in freight rates have shortened transit times and helped to keep the flow of finished goods constant.
Europe
The pricing dynamics of Stearic Acid have shown an erratic pattern in the German market. Early in Q1, a slow rise in product supplies was seen in the domestic market. Along with the slowed market conditions, the manufacturer's quotations have decreased. The demand for Stearic Acid from the downstream detergent industry has been sluggish overall. The downward trend in economic activity was being mitigated in European nations by reducing input cost constraints. Additionally, the upstream Palm Oil cost support increased, and the market was operating at high levels towards the end of the first quarter. Manufacturers have raised their prices as a result for the end-use industries.
For the Quarter Ending December 2022
North America
The price of SLES in the US declined consistently throughout the fourth quarter of 2022, largely because the upstream palm oil price was falling. At the conclusion of Q4 2022, Stearic acid was selling for roughly USD 1721/MT in the US market. The greater accessibility of upstream crude oil from Indonesia helped to bring down the price of generating SLES in the US. During the year's conclusion, the downstream beauty industry's low demand was readily met by the abundant supply from Indonesia. The decreased demand for sunscreens during the winter seasons also abetted the declining price trend of Stearic acid in the US during Q4 of 2022.
APAC
As a result of a steady supply of upstream palm oil from Malaysia entering the local market at a lower rate during the last quarter of 2022, Stearic acid prices fell in China. Stearic acid pricing in South Korea followed the same pattern as in China since South Korea and China imports majorly from Indonesia. Stearic acid was projected to cost around USD 1540/MT in South Korea by the end of Q4 2022. The fourth quarter of 2022 witnessed a steady fall in demand due to negative purchasing sentiments brought on by the rising Covid-related regulations in the Chinese market.
Europe
Throughout Europe, Stearic acid costs decreased in the fourth quarter of 2022. A significant supply of upstream palm oil from Malaysia to Europe was able to meet the demand from the continent's downstream cosmetic industry, which helped to lower the cost of operation for Stearic acid in the European region. The demand for Stearic acid across Europe fell as a result of declining European procurement activity brought on by the winter season and rising inflation rates. Due to a scenario of weak demand and marginal gains in operating rates in Europe as a result of declining energy costs, Stearic acid prices declined in Europe during Q4 of 2022. Stearic acid cost in Germany during the end of Q4 was recorded at around USD 1802/MT.
For the Quarter Ending September 2022
North America
Throughout the third quarter of 2022, the price of Stearic acid in the US steadily increased, primarily due to hikes in demand in the domestic market for sunscreens during the summer months. The rise in Stearic acid cost in the American market despite the strong supply from exporting countries like Malaysia and Indonesia. The cost of producing Stearic acid in the US was increased despite the increased availability of upstream crude oil from Indonesia due to high demand. The constant demand from the downstream cosmetics industries was not fulfilled by the strong supply of palm from Indonesia and Malaysia at the end of Q3 2022 in the US market, where the price of Stearic acid was reported at roughly USD 2139/MT.
APAC
Stearic acid prices increased in China throughout the third quarter of 2022, despite Malaysia's consistent supply of upstream palm oil entering the local market at a reduced rate. Stearic acid's price rise in the Chinese market was aided by the disrupted trade routes between Indonesia and China. The Covid-related restrictions in China disturbed trade, which further caused the demand to rise steadily. Stearic acid pricing in South Korea followed the same pattern as in China, as both countries imported from Indonesia. In South Korea, the cost of Stearic acid at the end of Q3 was estimated to be roughly USD 1863/MT.
Europe
Stearic acid costs increased in Europe throughout the third quarter of 2022. High energy costs increased the supply (transportation) cost in the European region, and the strong supply of upstream palm oil from Malaysia and Europe was not sufficient to satisfy the demand from the continent's downstream cosmetic (sunscreen) industry. High temperatures during Q3 throughout Europe caused demand hikes for downstream sunscreens. Stearic acid prices increased in Europe due to a scenario of rising demand as a result of high temperatures and operating cuts in the downstream cosmetics production facilities in Europe caused by excessive energy costs. Stearic acid cost in Germany during the end of Q3 was recorded at around USD 1973/MT.
For the Quarter Ending June 2022
North America
At the start of the second quarter of 2022, Stearic acid prices rose in the American market. The price increase in the domestic market for the entire second quarter was aided by the robust demand from the downstream cosmetic industry. After the supply of soyabean oil and sunflower seed oil was hampered by the ongoing conflict between Russia and Ukraine and floods in South Africa, the expensive upstream palm oil became the most in-demand food oil. However, the prices of Stearic acid eased during the last months of Q2 2022 in the American market due to improved supply from exporting countries like Malaysia and Indonesia.
APAC
Due to the rising costs of its upstream components, the price of Stearic acid in the Indian market climbed throughout the second quarter of 2022. The price of upstream palm oil in India increased because of the rising demand for edible oil on the Indian market. The price started to decline nearing the end of Q2 2022 due to the abundant supply of stearic acid from Bangladesh. The cost of Stearic acid peaked in China during the start of Q2 2022, owing to the several Covid-19-related lockdowns. The price eventually eased as the port conditions started to return to a normal state in the following two months, and the supply from Indonesia returned to a relatively normal state.
Europe
The price of Stearic acid in the European market increased at the beginning of the second quarter due to growing operating expenses brought on by high energy costs and rising upstream palm oil costs due to the European food oil crisis. The downstream cosmetics and candle manufacturing sectors' witnessed a negative market mood causing a decline in prices for the rest of Q2 2022. The cost of Stearic acid dropped in the European market due to poor demand for sunscreens and lotions during Q2 2022 and high competition from alternative surfactants like Linear Alkyl Benzene Sulfonic Acid, which is quite popular in European countries.
For the Quarter Ending March 2022
North America
Stearic Acid prices during the first quarter of 2022 witnessed month-on-month increment which was not high as other markets and was traded around USD 2255/MT in last month of the first quarter of 2022. The American downstream personal care sector has the largest consumer base, so they prefer to derive their Stearic Acid from corn oil, which is easily available in the US, unlike most of the global countries. High demand from personal care industry abetted the rising price trend of Stearic acid in the first quarter of 2022.
Asia Pacific
Stearic acid in the Chinese market during the first quarter of 2022 witnessed an upward trend and was traded around USD 2070/MT at the end of first quarter. The rise in the Stearic Acid prices was primarily due to the high demand of the upstream palm oil owing to limited production and exports from the major palm oil exporting countries like Malaysia and Indonesia. The fall in values of Chinese currency in spot market due to lockdown of ports to counter the resurgence of Covid cases contributed to the price hike of Stearic Acid. The Indian market witnessed Stearic Acid price trend which was very similar to that of the Chinese market where prices were recorded at USD 1720/MT during March 2022.
Europe
Stearic Acid prices in the European market increased at a slow rate and was traded at USD 2120/MT at the end of first quarter of 2022. The imports of upstream palm oil from Malaysia and Indonesia to the European countries were lower than usual on the account of Russia-Ukraine conflict, labor shortage in Malaysian palm fields, where Indonesia prioritized the regional market for palm oil exports. The low imports and availability of the upstream palm oil in Europe led to the upward trend of Stearic acid price in Europe in the end of Q1 of 2022.
For the Quarter Ending December 2021
North America
The Stearic Acid prices continued to hop upwards during the fourth quarter of 2021 on the back of raging import costs. The exorbitance in the import prices resulted from the record-breaking palm oil feedstock prices in the international market as well as heavy disruption in supplies due to the global container crunch, especially during October. The USA, which majorly imports stearic acid from Malaysia received a further hit in supply chains during December owing to the Malaysian floods, leading the prices in December to settle at USD 2230/MT, the highest in the year. The high demand in the personal care sector kept on exerting cost pressure on the stearic acid market.
Asia
The Stearic Acid market entered the fourth quarter of 2021 showing steep growth in prices. The tightness in supplies and the consequent skyrocketing palm oil feedstock prices caused Stearic Acid contracts in Asia to remain upsurged throughout the fourth quarter which weighed heavily on the downstream sectors. In India, the prices stabilized for a brief period in December as imports started paving their way in the domestic market, however, the renewed supply crisis in palm oil inventories in Malaysia, caused the prices to again tread upward, settling around USD 1540/MT. China market demonstrated a similar outlook to India as the Stearic Acid prices, which hovered around USD 1550/MT during December, remained to be the highest recorded price value in 2021 supported by the prolonged port container issue as well as strong feedstock in the international market.
Europe
The high price volatility of palm oil feedstock did not spare the European Stearic Acid market from the state of mayhem during the fourth quarter of 2021. The upward cost pressures from supply disruptions amid the container crisis also continued to circulate in the Stearic Acid market for a larger part of the quarter. Despite a small respite in the supply chains during December, the import frequency in Germany seemed to struggle catching up with the frenzied demand fundamentals projected by the downstream personal care sector causing the prices to settle at USD 2080/MT.
For the Quarter Ending September 2021
North America
The demand remained bullish for Stearic acid across the North American region in Q3 despite cripple production as raw material availability and logistical problems laid large over the supply fundamentals. The availability of trucks got limited in the US where hurricane Ida worsened the logistics issues in quarter 3. Concerns regarding tallow feedstock continued in the US oleochemical sector in Q3, while elevated consumption numbers from renewable diesel have further lengthened the supply of tallow. Intake volumes kept on rising through the quarter as the personal care products market continue its booming march ahead. Prices of Stearic Acid triple pressed were assessed at USD 1680-1710 per MT in early August on a DEL basis.
Asia
The Asian market witnessed a steep rise in the prices of Stearic acid across the Asia Pacific region in Q3 of 2021. In India, the market dynamics closely traced Q2 scenario as the demand from the domestic market remained stable, while prices of raw materials rose significantly in the country. Traders revealed that demand from downstream tire manufacturers improved towards the end of Q3 as the demand for tires after manufacturing of private vehicles since July. Thus, the pricing trend of Stearic acid followed an upward trajectory and Ex-Works offers in east India escalated from USD 801/MT to USD 1314/MT from July to September.
Europe
In the European region, under the fluctuation of palm oil price, the domestic market price of Stearic acid also fluctuated significantly during the 3rd quarter of 2021. Several Stearic acid producers raised their quotation many times in Q3 driven by the strong price and tight palm oil supplies from Southeast Asia. In terms of demand, offtakes remained firm from the downstream manufacturers. Soaring freight costs and increased shipping charges further affected the pricing trend across the region.
For the Quarter Ending June 2021
North America
During Q2 2021, North American Stearic Acid market witnessed firm sentiments, as the demand remained consistently strong, and prices rose effectively. The demand for Stearic Acid from the downstream soap and detergent sector remained sturdy throughout the quarter in USA, followed by demand from rubber and intermediate chemicals segment. In addition, soaring upstream Palm Oil prices in Asia also impacted the prices of Stearic Acid across the region in the meantime. Therefore, prices rose from USD 1132/MT to USD 1222/MT during this quarter in USA.
Asia
Stearic Acid prices kept fluctuating throughout the quarter in APAC region, due to volatility in feedstock prices. In China, prices of Stearic Acid remained high due to sturdy offtakes from the domestic market after strong economic rebound of the country. While in India, prices kept fluctuating due to uncertainties caused by pandemic and high volatility in prices of Palm Oil. Traders restrained to procure Palm Oil for the product, due to the uncertain demand pattern and availability of other alternatives in the market. Therefore, price eventually slipped to USD 876.8/MT during the last week of June in India.
Europe
Europe witnessed stable demand for Stearic Acid during this quarter, supported by firm offtakes from the downstream rubbers and detergent manufacturers. Prices of Stearic Acid rose effectively across the region due to expensive cargoes of Palm Oil from Asia and sturdy offtakes be the downstream end users. In addition, soaring freight cost and rise in production cost, also exacerbated the overall price increment on Stearic Acid in the meantime.
For the Quarter Ending March 2021
North America
The North American market encountered a steady rise in prices of Stearic Acid during Q1 2021. Despite of the stable demand from the downstream automotive and adhesive segment, prices rose effectively due to the material shortage. This rise was bolstered by severe shortage of feedstock chemicals and halted production activity after US gulf storm in February. Thus, the prices traced a sharp upturn of about 9.17% and hovered around USD 1130 per MT during March end across USA. This steep rise was also supported by expensive cargoes from Asian countries, as the prices of raw materials were running all time high during this timeframe.
Asia
Demand fundamentals in the Asian market also fluctuated in a stable to firm range, where post COVID 19 recovery brought improvement in rubber, lubrications and other automotive segments. However, these sectors were not fully restored and were running on lower pace compared to prior year, but the improvement was significant enough to drive changes in prices of Stearic Acid. Thus, the prices improved effectively and hovered around USD 930.6/MT during mid of January 2021 in Indian market. However, Asia was also struggling to procure raw material Palm oil, which was fuming those days.
Europe
In Europe, Stearic Acid prices also encountered a steady rise, despite of the low demand from downstream segments. This price rise was led by accelerating raw material prices amidst severe global shortage. In addition, expensive imports from Asia also supported this price rise. However, the demand remained low from downstream automotive segment, as the second wave of COVID 19 resisted proper industrial activities and reduced the sales of automobiles across the region.
For the Quarter Ending December 2020
North America
With the consistent increment in prices of the feedstock Palm Oil, Stearic Acid prices in the US took an uptrend later in the quarter. The supply of palm oil tightened towards the end of the quarter when USA declared a straight ban on the imports from several Malaysian producers including Sime Darby Plantation Berhad and FGV Holdings, under the allegations of labor abuse. As the supply of Palm Oil from its largest exporter Malaysia is bound to decrease, prices of derivative Stearic Acid are expected to remain firm in the near-term. Rising Brent crude is further anticipated to support the price trend in the region at least till Q1 2021.
Asia
Demand for Stearic Acid in the Asian market remained firm as various countries like China and India were heard utilizing their full capacities to make up for the loss incurred in H1 2020. Pick up in demand in India during the festive season in November also contributed to a prominent surge in its values. Consistent hike in the prices of feedstock palm oil across Southeast Asia has provided an astonishing upward push to the prices of Stearic Acid. With palm oil futures rising to an almost eight year high in December, and Indonesia levying an increase in the tax over its oil exports, price of Stearic Acid is expected to remain in a stable to firm range in H1 2021. The price for Rubber Grade Stearic Acid in India for the quarter ending December 2020 was averaged at USD 853 per MT.
Europe
Firm demand for Stearic Acid from the polymer and textile industry has sustained its rich market sentiments in Europe. As European Union is eyeing to reduce the imports of palm oil as it leads to increased deforestation activities, concerns of stressed availability of the feedstock has provided a forward push to the prices of Stearic Acid in the regional market. In early October, market fundamentals of Stearic Acid remained in a narrow range as various end-use industries kept operating their plants at reduced rates under fears of demand uncertainty. However, the plant utilization rates gradually improved under the optimism that prevailed from the consistent upward push in crude values.
