An Opaque Downstream Market Impacts Butanediol Prices in Europe

Germany- The Butanediol prices in the European market witnessed stagnancy on account of the slow demand outlook from the end-use manufacturing units such as the automotive, textile, and rubber industries. Upcoming competitors have already targeted the European automobile sector, but the present invasion intended by Asia-Pacific nations manufacturers is larger in scale and determination, as well as nearly electric. In the third week of May, Butanediol prices in the German market ranged between USD 2320 to 2480 per MT, Ex-Karlsruhe.

Europe's ambition to force its inhabitants to buy electric cars would wreak havoc on its traditional automotive industry, transforming it into a Trojan horse for Chinese manufacturers' often superior and always inexpensive battery-powered automobiles. Petrol and diesel-based engines are already costly due to EU legislation that prohibits the sale of new automobiles with Internal Combustion Engines (ICE) by 2035. The EU has set a goal of reaching net zero CO2 emissions by 2050. As a ripple effect, the demand for Butanediol remained on the uncertainty ratio as the suppliers received modest Butanediol inquiries. Automotive front and rear ends, bumpers, and other parts are some of the applications for butanediol-based urethane elastomers (downstream of Butanediol). Footwear, electrical enclosures, recreation equipment, appliances, and furniture are examples of non-automotive applications.

Other facets governing the overall production and the selling cost of Butanediol include the obtuse price momentum of its feedstock (Maleic Anhydride). Crude oil prices in the international market remained on a lower edge in the fifth month of 2023, proportionally impacting the production cost of Benzene and Maleic Anhydride (raw material). On the other hand, the country is recovering from the inflation rate and slight relaxation in energy prices. As per ChemAnalyst, Butanediol market prices are anticipated to move forward in the upcoming weeks on account of a better demand outlook. The supply chain has improved drastically in the region, along with moderate delivery charges on the domestic shores.