VER Market Fluctuates Globally, Asian Market Stable; Europe Witnesses a Surge

During the initial half of April 2024, the Vinyl Ester Resin (VER) market experienced price fluctuations in both Europe and Asia. The overall sentiment remains positive, mirroring the trend observed in the European market in the previous month. However, the Chinese market demonstrated price stability, attributed to adequate supplies. A factor contributing to this stability is the decreased price of feedstock Epoxy resin in the region. Nevertheless, strong demand from downstream sectors of VER, particularly in the production of Fiberglass Reinforced Plastics (FRP) composites for automotive and construction applications, has contributed to a positive market outlook.

In March 2024, the European VER market, particularly Spain, experienced a 2% increase, which continued into April and is anticipated to see a slight overall rise throughout the month. This price surge is primarily due to inadequate inventory levels in the regional market. Although the cost of feedstock Epoxy resin decreased this month, the pricing of VER was mainly influenced by supply-demand dynamics. Additionally, VER prices have been decreasing for the past four months due to sluggish demand, but insufficient inventory levels prompted traders to adjust prices upward. Despite this, demand from downstream composite manufacturing, especially in the construction and automotive sectors, remained subdued. While there was solid demand from the construction industry overall, downstream sectors expressed a pessimistic outlook due to subdued demand resulting from high-interest rates and economic uncertainty.

Furthermore, during this period, the Asian market generally maintained price stability, with a slight decrease of 0.3% observed in Chinese VER Novalac-based CFR Qingdao during the second week of the month. This consistent pricing can be attributed to the balanced relationship between supply and demand. However, the price of feedstock Epoxy resin, which is influenced by a decrease in production expenses, has impacted VER prices. The strong demand for VER, driven by its corrosion resistance and mechanical properties, has notably increased its use in the automotive sector. Additionally, downstream segments of VER involved in the production of Fiberglass Reinforced Plastics (FRP) composites for automotive and construction applications have shown a positive market outlook.

According to ChemAnalyst, the price of VER is projected to continue rising in April and May across both Asian and European markets. This anticipated increase in VER prices can be attributed to an expected rise in demand from downstream industries during the summer season. Furthermore, the tensions between Iran and Israel may potentially affect the trade route passing through the Strait of Hormuz, which connects the Persian Gulf to India. This could result in disruptions to shipping, particularly affecting Saudi Arabia, whose access to Gulf ports would be further constrained if their Red Sea port access is already challenged. These disruptions would have ripple effects on container hubs in India, some of which play a critical role in connecting South Asia and the Middle East through various services. Consequently, these disruptions could impact the supply chain and subsequently influence VER prices.