Erucic Acid Prices Decline Across the Globe Due to Feeble Demand

The price trend of Erucic Acid showcased bearish sentiments in the global market during May 2023. Suppliers reduced their quotations amid the availability of previous stock in the market. According to the sources, the increased cultivation of Rapeseed in France raised the feedstock Rapeseed Oil availability in the market, which decreased the upstream cost support on the production cost of Erucic Acid.

Meanwhile, Erucic Acid offtakes were inadequate and sluggish from the market. The consumption rates of Erucic Acid declined from Biodiesel producers. As a precursor of Biodiesel fuel, the demand remained sluggish due to a reduction in fuel demand with temperature rise. Simultaneously, orders were moderately low from the rubber and paint industries amid weak demand for rubber in the end-user sector. Offtakes were moderate from Pharma industries and personal care product manufacturers.

Furthermore, Europe’s manufacturing PMI fell during May 2023, indicating a contraction in manufacturing activities, and remained below 50. Concurrently, Euro depreciated 2.50% against the USD during May 2023 amidst increasing inflation in the region and rising bank interest rates.

As per “The Korea Herald” sources, the outbound container costs for Asia to the European region increased by 7.6% during the month, raising the cost support on Erucic Acid import prices in Europe. On the contrary, the container freight cost declined for the Asian region. The 40 feet container bound for China by 2%, and the cost of importing a 40 feet container from the USA’s West coach and East coach to South Korea declined by 2.6% and 9.1%, respectively.

Consequently, in almost all the countries in the European and Asian region, the prices of Erucic Acid fell by 4.5% to 6.5% during May 2023. Conclusively, the Erucic Acid prices in Germany and Belgium were settled at USD 325 and USD 338/MT at the end of May. Simultaneously, import prices of Erucic Acid in China and South Korea hovered at USD 231/MT and USD 180/MT, according to the ChemAnalyst data sources.

As per the estimation, in the upcoming weeks, demand for Erucic Acid may remain moderate from buyers. However, the supply rates may get affected in Europe due to changes in water levels of the Rhine River during the month. Similarly, in the Asian region, the supply rates may get affected due to storms and typhoons. Recently the Biporjoy cyclone in the Asian region and around the Indian coastline has been affecting trade activities through the Arabian Sea. It will raise the logistics and freight costs and increase the final costs of Erucic Acid in the markets.