EDC Prices Rebounds in November Against Uncertainties Hovering in Asia and Europe

The Ethylene Dichloride (EDC) prices slowly gained an upward rally at the beginning of November 2023, as the enterprises constantly approached resilience in the market situation by keeping the prices stable to high in the Asian and European markets. The November EDC prices acquired a plunging margin state amidst inadequate demand from the downstream industries at the termination of the previous month. Therefore, the fluctuating crude oil prices limited the operational rates and imposed a tightening of the supplies in Europe, which provided market participants to sustain their margins in the line of uncertain downstream trading atmosphere in the first half of the month.

In Europe, the EDC prices shifted upward after experiencing consistent declines in the preceding two months amidst northward price momentum of feedstock Ethylene prices and high input costs. Additionally, the cautious rise in Asian markets and limited availability for European shipments provided an opportunity for sellers to adopt a firmer EDC pricing momentum in the international market. Meanwhile, there was persistent uncertainty among market participants regarding the sustainability of the recent strengthening in Europe, due to the uncertainties in the regional demand outlook from the downstream PVC segment.

In Asia, EDC prices stabilized following a consistent upward trend driven by increased demand from the PVC market. The week ending November 10th, 2023, saw a moderation in EDC price momentum due to a decline in feedstock Ethylene prices. Meanwhile, regional downstream buyers focused on essential procurement, signaling a shift towards international markets, particularly in Latin America. However, buyers later considered the recent price offers for November shipments reasonable, leading to proactive restocking measures in response to diminishing inventory levels.

As per ChemAnalyst, the EDC prices in the second half of November 2023 are anticipated to gain a marginal northward trend due to expected uncertainty in the downstream PVC orders in the Asian and European markets. From the upstream perspective, some feedstock Ethylene producers tend to announce plant shutdowns in the coming weeks in response to uncertainty in the current market conditions across the European region and as a ripple effect, EDC players also opted cautious approach by limiting production rates prompting prices to surge amid short supplies and improving regional demand fundamentals. Moreover, the Asian EDC price trend is expected to be mainly driven by the demand outlook as the supply side is likely to support a bearish market situation in the coming weeks of November 2023.