The Downward Price Trend of European Neoprene Rubber Ends as October Winds Up

Hamburg, Germany: Prices for Neoprene Rubber have overall decreased in the European market in October 2022 because of reduced production costs and better supply chain circumstances. Neoprene Rubber's market value has been falling since the beginning of October month, but in the last few weeks of the month, the percentage of price declines has dramatically grown. The price of Neoprene Rubber was USD 5300/MT FOB Hamburg during October 2022, a drastic reduction of 17.1% from the previous month when it was settled at USD 6390/MT FOB Hamburg. However, the Neoprene Rubber market trend is supposed to reverse itself in November owing to increased demand for energy in winter and its market value during the first week of November suggests the same.

For the time being, the cost of producing Neoprene Rubber declined due to the dropped in natural gas prices in the European market. This led to lower upstream costs and a decline in the material's market value. However, according to experts, this decline in natural gas prices is merely a passing trend, and when winter hits and energy consumption rises, the market will face new challenges. Although European downstream demand from the construction and automotive sectors recovered, it was still insufficient to impact the market substantially. Supply-side bias dominated Neoprene Rubber in October 2022, controlled by its upstream operations.

Furthermore, the supply chain was functioning considerably better than previously, leading to less expensive imports and greater material availability in the regional market. Port crowding, vessel bunching, and yard occupancy rates have fallen in the region compared to prior months. As a result, the supply chain's regularity supported Neoprene Rubber's lower market price. As the second week of November has started, Neoprene Rubber prices are rising in the European market, as reported by market participants.

As per ChemAnalyst anticipations, "The Neoprene Rubber market value would surge in November due to the prevailing energy crisis amidst huge demand in winters from households. Increment in offtake of Neoprene Rubber from automotive and construction industries is likely to support its price hike as well."