Lacklustre Downstream Demand Decelerates the Market Fundamentals of Calcium Carbonate in Germany

Hamburg, Germany: The tepid demand from the downstream construction sector has subdued the market growth of Calcium Carbonate across the major economies of Europe. With declining production costs and a slump in manufacturing activities, the prices of Calcium Carbonate witnessed a significant plunge in late Q1 of 2023 on an m-o-m basis. High inflationary pressures, rising interest rates, and weak consumer sentiments have faltered the demand recovery.

Since the start of Q1 2023, Calcium Carbonate costs have been continuously dropping amid weak demand fundamentals. The market players were cautious as the build-up of high-cost inventories has been curtailing their profit margins. Still, to stimulate new shipments, the manufacturers have slashed their offers. With the world economy slowing down due to the Russia-Ukraine war's retaliatory effects and the COVID-19 situation, the German manufacturing purchasing index has remained in the contraction zone (i.e., below 50 points). In addition, the lower freight charges and ease in input cost inflation have a cumulative effect on the downshift observed in the price realizations of Calcium Carbonate.

Overall, there has been ample availability of the product in the domestic region. Space shortages and supply bottlenecks at ports, warehouses, and storage yards have been caused by the continued decline in the container shipping demand from epidemic highs, which has left a pile of extra containers stranded around Europe. The ChemAnalyst databases have shown that the price trends of Calcium Carbonate have remained at lower levels throughout the first quarter. In Germany, Netherlands, and Belgium, a 5-8% plunge has been observed in Calcium Carbonate costs. In March, the European Central Bank increased interest rates by an additional 50 basis points as the region continued to struggle with excessive inflation.

According to the pricing intelligence of ChemAnalyst, the prices of Calcium Carbonate might sustain their downward trajectory in the coming month amidst ease in input energy costs and ample stock availability. Although with the arrival of warmer weather, construction activities are anticipated to pick up and are likely to contribute to the market growth of Calcium Carbonate in the second quarter of 2023.