US Ethyl Acrylate Market Experiences a Downturn Due to Construction Obstacles

USGC, USA: The Ethyl Acrylate market in the US continues to experience a downward trend, reflecting overall bearish market sentiment. This decline is primarily driven by lower production costs, as prices for key feedstocks, Ethanol and Acrylic Acid, have decreased. Additionally, weakening demand for Ethyl Acrylate from downstream sectors, particularly coating and construction enterprises, has further contributed to the bearish outlook. With reduced consumption and ample supply, market players are facing downward pressure on prices, reinforcing the ongoing decline in Ethyl Acrylate market dynamics.

During the week ending on 27th September, the Ethyl Acrylate market in the US witnessed a 0.56% decline, with prices settling at USD 1750/MT (FOB-USGC). This decline was largely driven by weak demand for Ethyl Acrylate from downstream sectors such as coating and construction enterprises. The subdued demand was adequately met by existing inventory levels, prompting market players to lower their ex-quotations to reflect the current market conditions. The oversupply situation, combined with a lack of strong downstream consumption, has reinforced the bearish market sentiment for Ethyl Acrylate. This reduction in prices aligns with the overall trend of declining production costs, as feedstock prices continued to soften.

In the construction sector, U.S. single-family homebuilding experienced a sharp rebound in August, following the fading impact of Hurricane Beryl, which had previously slowed homebuilding in the southern regions. Despite this temporary boost, the construction sector's momentum may not be sustained, as evidenced by only a modest rise in building permits. The growing supply of new homes, coupled with an increasing inventory of pre-owned homes, is putting pressure on the housing market, ultimately reducing demand for Ethyl Acrylate in construction-related applications. The U.S. Commerce Department’s report further highlighted that despite a 50 basis point rate cut by the Federal Reserve, the first since 2020, homebuilders continue to face challenges due to rising inventories and a slowing housing market, further weighing down demand for Ethyl Acrylate.

The Ethyl Acrylate market in the US has been adversely impacted by a challenging lending environment for construction projects and continued weakness in commercial property values, which have hindered inquiries and slowed construction activity, leading to reduced demand. Additionally, weaker-than-expected job growth in August signaled a potential economic slowdown, further dampening market sentiment and demand for Ethyl Acrylate. Market uncertainty was exacerbated by a brief Canadian rail lockout and the threat of an ILA port worker strike, both of which disrupted supply chains and reduced purchasing activity. Compounding these issues, escalating input costs for energy and raw materials squeezed profit margins for Ethyl Acrylate producers. As a result, producers were faced with the difficult decision of absorbing the rising costs or passing them on to consumers, potentially leading to higher prices and further weakening demand in an already struggling market.

According to ChemAnalyst, the Ethyl Acrylate market in the US is expected to maintain its bearish sentiment due to the persistently weak demand from downstream sectors such as coating and construction enterprises.