Global n-Butanol Witnesses Mixed Market Sentiment Due to Uncertain Demand Dynamics

The price of n-Butanol experienced mixed market sentiments during mid-April 2023 in the global market due to the fluctuation in downstream demand, specifically in the coating and textile industry. As per the market analysis, market participants were cautious regarding the competitive market situation and supply chain disruptions due to the steep rise in Crude Oil prices.

In Asia, the n-Butanol prices were low owing to the muted downstream inquiries in the coating and textile industry. Meanwhile, the oversupply of feedstock Propylene impacted the n-Butanol prices and reduced profits for producers amidst a slowdown in the downstream operational rates. The slow revival in the economic conditions provoked market players to switch to alternative products that offer cost advantages. However, at the beginning of April 2023, the domestic n-Butanol market in China showed a small increase due to marginal upward downstream demand indications. Conclusively, in the second week of April 2023, commodity prices fell back owing to the deteriorating new orders and weak international demand in the n-Butanol market in the week ending April 14, 2023.

Besides, the n-Butanol prices witnessed a marginal upward trend in March 2023 in Europe, backed by the stability in the demand from the coating industry and reduced production activities. Meanwhile, European n-Butanol enterprises felt wide uncertainty as OPEC discontinued crude oil production, and sanctions disrupted the Russian output at the end of March 2023. Factory operations were stagnant, and exporters faced high freight charges as a major issue, along with the weakening of demand. Meanwhile, disruptions in production activities due to workers' strike actions in the industries of Europe amid inflation also contributed to the final monthly prices of n-Butanol in March 2023.

As per ChemAnalyst, the prices of n-Butanol are expected to drop in May 2023 due to the weakening cost support from the downstream industries and market players likely to undergo narrow adjustments due to uncertainty in the supply and demand side in the global market. Meanwhile, the steep rise in crude oil prices is expected to increase the input cost pressure on the enterprises and might lead to an elevation in the commodity prices for the short term towards the termination of April 2023.