Global Chemical Markets Diverge as Feedstock Costs Rise and Downstream Demand Remains Weak
š During October 5ā9, global chemical markets saw price increases across several segments, primarily driven by higher feedstock costs and a post-holiday recovery in China. However, weak downstream demand continued to limit the breadth of the rebound.
š In Europe, October ethylene and propylene contracts both rose by EUR 80/tonne, while styrene increased by EUR 279/tonne. Higher naphtha costs prompted producers to propose PE/PP price increases, although weak demand continued to constrain their ability to pass on costs.
šØš³ In China, PE/PP markets recovered after Golden Week, supported by stronger futures and lower-than-expected inventory accumulation. Combined inventories at Sinopec and CNPC rose 21.5% after the holiday, the smallest increase for the same period in five years. Methanol futures also surged nearly 9% in one session, supported by tighter spot supply and cost pressures.
š Regional differences remained pronounced. The US maintained a feedstock cost advantage through ethane, Europe faced elevated energy costs, and Asian markets benefited from stronger Chinese pricing. Fertilizer markets were relatively more stable, although US prices remained above year-earlier levels.
š Despite rising chemical prices, buyers continued to limit inventory accumulation as downstream profit margins remained compressed. This suggests that cost pressures and supply conditions, rather than a strong recovery in consumption, were the main drivers of price gains.
š Looking ahead, oil prices, Chinese polymer inventories, and actual downstream purchasing activity will be key indicators. Elevated feedstock costs could continue supporting chemical prices, but a sustainable recovery will depend on stronger end-user demand.
#ChemicalMarket $NATGAS
š During October 5ā9, global chemical markets saw price increases across several segments, primarily driven by higher feedstock costs and a post-holiday recovery in China. However, weak downstream demand continued to limit the breadth of the rebound.
š In Europe, October ethylene and propylene contracts both rose by EUR 80/tonne, while styrene increased by EUR 279/tonne. Higher naphtha costs prompted producers to propose PE/PP price increases, although weak demand continued to constrain their ability to pass on costs.
šØš³ In China, PE/PP markets recovered after Golden Week, supported by stronger futures and lower-than-expected inventory accumulation. Combined inventories at Sinopec and CNPC rose 21.5% after the holiday, the smallest increase for the same period in five years. Methanol futures also surged nearly 9% in one session, supported by tighter spot supply and cost pressures.
š Regional differences remained pronounced. The US maintained a feedstock cost advantage through ethane, Europe faced elevated energy costs, and Asian markets benefited from stronger Chinese pricing. Fertilizer markets were relatively more stable, although US prices remained above year-earlier levels.
š Despite rising chemical prices, buyers continued to limit inventory accumulation as downstream profit margins remained compressed. This suggests that cost pressures and supply conditions, rather than a strong recovery in consumption, were the main drivers of price gains.
š Looking ahead, oil prices, Chinese polymer inventories, and actual downstream purchasing activity will be key indicators. Elevated feedstock costs could continue supporting chemical prices, but a sustainable recovery will depend on stronger end-user demand.
#ChemicalMarket $NATGAS