For the Quarter Ending September 2024
North America
In Q3 2024, the North American region saw a significant decline in Acetone prices, with the USA experiencing the most pronounced price fluctuations. Several factors contributed to this downward trend, primarily the reduced demand from downstream industries such as cosmetics and pharmaceuticals, which traditionally drive Acetone consumption.
Despite stable production costs, the market faced several challenges, including supply chain disruptions caused by adverse weather events like hurricanes and unexpected plant shutdowns. Notably, Shell Chemicals experienced a temporary plant shutdown due to force majeure, which adversely affected its overall operational capacity.
This situation contributed to an overall negative sentiment in the market, reflected in the correlation between declining crude oil prices and the downward trend of Acetone prices. During the quarter, prices dropped by 26% compared to the same period last year, illustrating the ongoing pricing pressure. Additionally, a 1% decline was recorded compared to the previous quarter, while a noteworthy 3% difference was observed between the first and second halves of the quarter, underscoring market volatility.
APAC
In the third quarter of 2024, the Acetone market in the APAC region faced a significant decline in prices, driven by various critical factors. A primary influence on this downturn was the continuous stagnation in propylene prices, a key feedstock essential for acetone production. This situation resulted in widespread price reductions across the market. During this quarter, stable demand from downstream solvent industries was observed, but sluggish overall market activity further contributed to the downward price trend. In mid-quarter, Mitsui Chemicals experienced a temporary plant shutdown due to maintenance work, which negatively impacted its operational capacity. Japan was particularly affected, experiencing the most significant price changes that mirrored the prevailing negative sentiment across the region. The quarter registered a substantial decrease in prices compared to the same period last year, reflecting an -11% decline. Moreover, a quarter-on-quarter analysis indicated a -6% decrease, further underscoring the consistent downward trend in the market and highlighting the ongoing challenges faced by the acetone industry in the APAC region.
Europe
In Q3 2024, the European Acetone market experienced a notable rise in prices, with the Netherlands reflecting the most significant changes in this trend. Several key factors contributed to this price increase, including limited supply from manufacturers, which tightened market conditions, coupled with adequate feedstock availability. Additionally, a balanced supply of propylene, a crucial feedstock for acetone production, helped stabilize the market dynamics. However, towards the end of the quarter, operational capacity faced disruptions as CEPSA Group and Seqens Group experienced temporary plant shutdowns due to maintenance work. Compounding these issues, workers at the Port of Hamburg halted operations, followed closely by similar actions in Bremen-Bremerhaven. This labor action was initiated by the trade union, which aimed to pressure employers into making additional concessions during ongoing wage negotiations with the Central Association of German Seaport Operators (ZDS). Furthermore, a significant backlog of container ships had formed off the coast of California, contributing to logistical challenges. Collectively, these factors influenced the price incline throughout the third quarter, underscoring the complexities in the European Acetone market.
For the Quarter Ending June 2024
North America
In Q2 2024, the Acetone market in North America experienced an overall mixed trend in prices, driven by several key factors. The overall market dynamics were influenced by a robust rise in demand from essential downstream industries. Prices inclined in the first half of the quarter and this rise in demand was compounded by supply constraints, primarily due to logistical challenges and decreased operational rates at phenol plants, which are crucial for Acetone production. On the other hand, the prices showcased negative fluctuations in the second half of the quarter amidst the high inventory’s availability. Additionally, fluctuations in crude oil prices, a significant determinant for naphtha and subsequently Acetone prices, contributed to impacting the final prices of Acetone.
With a 10% decline from the previous quarter, the year-on-year comparison shows a striking 49% increase, underscoring the robust demand recovery and supply constraints faced during this period. Seasonality played a role, with the construction sector's typical off-season slowdown being less impactful due to sustained industrial activity. Prices in the first half of the quarter remained relatively steady, with only a slight 1% increase observed in the second half, indicating a stable yet positive pricing environment.
The quarter concluded with Acetone prices at USD 1318/MT, DEL Texas. This marked stability and modest growth, reflecting a positive pricing trend. The confluence of increased demand, constrained supply, and fluctuating crude oil prices suggests that the Acetone market in the USA during Q2 2024 remained resilient and showcased mixed market dynamics, despite the seasonal and logistical challenges.
APAC
The second quarter of 2024 has been characterized by a significant upward trajectory in Acetone prices across the APAC region, influenced by a confluence of factors. Market dynamics have been primarily driven by a consistent increase in demand from end-use sectors such as pharmaceuticals, and personal care products. The fluctuations in crude oil and naphtha prices have also contributed to rising production costs, which, in turn, have elevated Acetone prices. Additionally, the strategic production cuts by OPEC+ and constrained supply chains due to geopolitical tensions and logistical challenges have exerted upward pressure on prices.
Focusing on Japan, the country has experienced the most pronounced price changes in the region. The overall trend has shown a clear escalation, influenced by seasonal demand variations and supply chain constraints. Compared to the same quarter last year, Acetone prices in Japan have surged by a substantial 29%, indicating a robust year-over-year growth influenced by both increased demand and higher feedstock costs. From the previous quarter in 2024, prices have risen by 11%, reflecting a steady climb driven by ongoing market tightness and rising operational costs. Within the quarter itself, a 2% price increase from the first to the second half further underscores the persistent demand and constrained supply environment.
By the end of the second quarter, the price of Acetone in Japan reached USD 909/MT FOB-Osaka. This consistent price increase highlights a predominantly positive pricing environment, with strong demand fundamentals and supply chain challenges propelling the market upward. The quarterly performance underscores a buoyant market sentiment, driven by both internal demand factors and external cost pressures.
Europe
In Q2 2024, the European Acetone market faced a significant downturn, driven by multiple converging factors that exerted downward pressure on prices. The quarter was marked by an oversupply of Acetone, coupled with an ample availability of its key feedstock, propylene. This surplus was exacerbated by stable production rates and the restart of a major derivative unit, which alleviated any previous supply constraints. Additionally, limited demand from downstream sectors such as personal care, adhesives, and solvents further contributed to the bearish sentiment.
Compounding these effects, geopolitical tensions, particularly in the Red Sea, led to logistical disruptions, forcing vessels to adopt longer, more costly routes. This increase in shipping costs and delays added strain to an already oversupplied market, driving prices even lower. Germany experienced the most pronounced price fluctuations in the region. The overall trend for the quarter indicated a persistent decline in Acetone prices, reflective of seasonal demand variations and a broader market downturn.
Compared to the same quarter last year, prices plummeted by 21%, underscoring a stark negative shift. From the previous quarter in 2024, prices decreased by 5%, indicating a continuation of the downward trajectory. Within the quarter itself, the first and second halves saw a price decrease of 4%, further cementing the declining trend. The quarter ended with Acetone prices at USD 1250 per metric ton, FD Karlsruhe.
For the Quarter Ending March 2024
North America
Acetone prices in the North American market witnessed the plunge during Q1 of 2024, influenced by a range of supply and demand factors. In the US, prices have stabilized at USD 1450 per metric ton, FOB Texas, as reported in March. This stability is attributed to sufficient acetone inventories which have effectively met the moderate demand from end-use manufacturing units. Despite this, there has been an underlying tension due to rising benzene prices, a key component in acetone production, driven by increased domestic and international demand from industrial and commercial sectors.
Earlier in the quarter, acetone prices were notably higher, peaking at USD 1500 per metric ton due to tight inventory levels from Q4 of 2023. The pricing dynamics have been significantly influenced by the supply chain adjustments and production rates at key phenol plants, which indirectly affect acetone output due to their interconnected production processes.
The price dynamics was based on a potential uptick in demand from the construction sector as the weather improves and projects resume. Additionally, geopolitical factors and crude oil price trends are likely to impact benzene supply costs, further influencing acetone price trends. Overall, while the acetone market in North America has remained relatively stable, it is sensitive to shifts in both upstream feedstock prices and downstream demand dynamics. Companies are closely monitoring these trends to adjust their strategies, accordingly, maintaining a balance between production efficiencies and market supply levels.
APAC
The acetone market in the APAC region displayed inclining trends across different countries during Q1 2024. The limited availability was primarily due to the maintenance shutdown at major producer Chang Chun Plastics Co., Ltd. in Taiwan, impacting supply chains across the region. This shortage also affected prices in China, where they increased by 1.7%, again influenced by reduced exports from Taiwan.
Conversely, in Thailand, the acetone market saw a price decrease and was attributed to fluctuations in naphtha and crude oil prices, which are key feedstocks in acetone production, affecting the domestic production costs. After the holiday season, the Asian market experienced a revival, leading manufacturing facilities to restart operations in response to heightened demand. The stock market also surged, driven by fresh orders, consequently boosting profit margins for toluene producers and sellers. Post the Spring Festival, there was an uptick in the locally refined straight run naphtha market due to heightened terminal demand, prompting refineries to ramp up production.
Overall, the acetone market in the APAC region during Q1 2024 was marked by a series of supply challenges stemming from maintenance shutdowns and geopolitical tensions, which led to slight price increases in several countries. However, ample stockpiles and strategic import adjustments helped stabilize the market to a certain extent, preventing drastic price escalations.
Europe
In the European market, acetone prices increased across regions, driven by demand from solvents, personal care, and cosmetics industries. As of March end, prices were around USD 1374 in Germany. These prices were influenced by local demand and broader market factors, including rising benzene and naphtha costs, key feedstocks in acetone production. Geopolitical tensions and supply chain disruptions further impacted the market, leading to a bullish trend. Regional differences in energy and production costs also affected pricing. The UK and Germany, with higher costs, reflected this in their pricing compared to the Netherlands and Belgium.
Looking ahead, the European acetone market is expected to see gradual price increases due to tightening supply, rising feedstock costs, and stable to increasing demand. Companies are adjusting strategies to manage costs and balance demand-supply dynamics. This adaptation is likely to maintain a moderately bullish market, with vigilance against potential disruptions in the global chemical supply chain. The port in Rotterdam noted ample space available, thanks to two consecutive years of weak demand and reduced retail inventories.
This capacity had allowed the port to manage any surge in volume when ocean carriers resume regular transits through the Red Sea. The supply chain for the product remained somewhat constrained in the country, as logistics operations ran smoothly with sufficient inventories to meet demand from end-users. Buyers placed limited orders due to the modest demand.
For the Quarter Ending December 2023
North America
In the fourth quarter of 2023, the Acetone market in North America experienced a substantial surge in prices. The market encountered tight supply constraints due to limited volumes in the domestic spot market, and production rates declined, leading to an accumulation of inventory. However, limited procurement activities by potential buyers posed significant price challenges, resulting in a premium in the domestic market.
The United States was the most impacted country, with prices following a bullish trend due to robust cost support from upstream Benzene and high demand from downstream derivatives, particularly the Bisphenol A industry. The country also faced restricted inventory availability, contributing to price hikes. Notably, there were no reported plant shutdowns during this quarter.
Inflationary pressures had increased as the prices of materials, such as metals and plastics from suppliers, and transportation charges, rose more sharply. In response to OPEC's supply cuts, the Americas, especially the United States, had enhanced their supply. Although OPEC's actions were aimed at sustaining existing price levels, they had prompted Americans to seize market share at heightened prices. At the end of the quarter, Acetone prices in the USA stood at USD 1472/MT DEL Texas.
APAC
During Q4 of 2023, the Acetone market in the APAC region experienced a bearish trend, attributed to reduced demand from downstream industries, lowered import prices, and limited inquiries from importing countries. As the quarter concluded, production rates decreased, and a pessimistic demand outlook contributed to a decline in prices. In Japan, the Acetone market underwent significant price changes, in FOB Osaka prices. The quarter concluded with the latest Acetone FOB-Osaka price settling at USD 770/MT. The demand forecast for the downstream sector, including bisphenol and personal care products, was conservative, potentially favouring buyers with advantageous offers for higher orders. As inflation exceeded the targeted rate for an extended duration, market participants anticipated that the Bank of Japan (BOJ) would raise short-term interest rates from negative levels in the following year. Japan's prolonged experience with low inflation and stagnant wage growth likely heightened the public's belief that prices and wages would persistently remain stagnant around zero. Notably, there were no reported plant shutdowns during this period.
Europe
In Q4 of 2023, the European Acetone market experienced an incline in prices. Demand remained moderate due to subdued downstream requirements from bisphenol, personal care, and disinfectant sectors. Acetone prices in the Netherlands and Germany remained steady with ample stockpile availability. However, Belgium witnessed a price improvement due to limited inventory availability. Towards the end of the quarter, lower production rates and a subdued demand outlook from the bisphenol and personal care sectors emerged. The increased energy prices gradually elevated the overall production cost of Acetone in the European market. The heightened operational rate amid increased demand impacted overall Acetone prices. Demand remained constant during the winter season, influenced by a slowdown in construction activity. The latest Acetone price in Belgium for Q4 2023 was USD 1134/MT. Towards the quarter end, the tight supply amidst the Red Sea conflict elevated the overall market dynamics of Acetone in the European market.
