The prices of Tallow Oil declined globally significantly during December, driven by multiple factors. The primary reason for the drop in prices was the weakening demand across major markets, including the food, cosmetics, and biodiesel sectors, which are the main consumers of Tallow Oil. This was further compounded by the steady buildup of inventories in multiple regions, where market participants, anticipating a slower market, sought to maintain a balance between supply and demand. As producers adjusted their prices in response to weaker demand, global Tallow Oil prices saw substantial reductions.

The moderation of India's manufacturing activity in December, marking the slowest growth in 12 months, has contributed to the decline in prices for products like Tallow Oil. This slowdown, driven by increased competition and price pressures, has created a more cautious market environment. The reduced pace of manufacturing growth and a significant dip in new orders, which reached their lowest point of the year, signal weaker future production. As a result, demand for various products like Tallow Oil has been subdued, leading to a decrease in prices. Manufacturers facing challenges in securing new orders may also be adjusting their purchasing strategies, reducing stock levels, and delaying purchases in response to the uncertain outlook, further exerting downward pressure on commodity prices such as Tallow Oil.

In Europe, particularly Germany, a major producer and exporter of Tallow Oil, prices dropped considerably due to sluggish demand from international buyers. The slowdown in industrial activity and weak consumer sentiment across the Eurozone contributed to the decline. Additionally, rising inventory levels in Germany and other parts of Europe placed further downward pressure on prices. Compounding the issue, Germany’s inflation rate rose faster than expected in December, with consumer prices increasing to 2.4% from 2.2% in November. This marked the third consecutive month of rising inflation after previously dipping below the European Central Bank’s two-percent target. The higher inflation dampened purchasing power, prompting cautious buying behavior from end-consumers, which further contributed to the downward trajectory of Tallow Oil prices.

In the UAE, a major importer of Tallow Oil, prices also declined sharply in December, mirroring the global trend. The price drop was driven by reduced demand in key sectors such as personal care and biofuels, combined with improved shipping conditions and falling freight rates. While currency fluctuations remained stable, the UAE’s market still experienced a notable decrease in Tallow Oil prices. This was largely due to the reduced purchasing activity and cautious buying behavior from importers who were influenced by the weakening global market. Despite the favorable procurement conditions, the overall demand slowdown in the region kept prices under pressure.

According to ChemAnalyst analysis, the prices of Tallow Oil could rise as the year progresses, driven by a resurgence in demand from key sectors. As industries recover from the slowdowns experienced during the final months of 2024, increased activity could lead to higher consumption of Tallow Oil, prompting a reversal in price trends. Furthermore, market participants are likely to seek replenishment of inventories that may have been depleted during the price drop, contributing to upward pressure on Tallow Oil prices.