For the Quarter Ending September 2024
North America
During the third quarter of 2024, the US AES market experienced mixed pricing dynamics. Prices initially declined in July, followed by a bearish market trend, before rising again in September. These fluctuations were largely driven by changes in Fatty Alcohol prices, which directly impacted production costs for AES. In September, industrial production fell by 0.3%, and chemical production decreased by 0.25%, further affecting AES availability in North America. Procurement activities for AES were moderate, with limited inquiries from downstream markets. Despite the North American surfactant sector achieving record highs, demand for AES fell short of expectations.
However, reports indicated an improvement in new orders throughout September, a trend expected to continue into October. Manufacturers have relied on depleting backlogs to maintain operations, with the pace of backlog clearance reaching its highest level for the year to date. Overall, while demand dynamics remain uneven, the increase in new orders provides a glimmer of optimism for the AES market as it moves into the final quarter of the year.
APAC
In Q3 2024, the Alkyl Ether Sulfates (AES) market in the APAC region experienced a significant increase in prices, driven by various key factors. The market saw a notable 30% surge in prices compared to the same quarter last year, with a 13% increase from the previous quarter in 2024. This upward trend was primarily influenced by a combination of factors such as rising production costs, including an uptick in feedstock prices like Ethylene Oxide and Fatty Alcohol. Additionally, challenges in the palm oil supply chain, increased freight charges, and moderate to high demand from the downstream FMCG industry played crucial roles in pushing prices higher. In Malaysia, palm oil prices surged by approximately 11% in late September 2024, following a 3.8% decline in production to 1.82 million tonnes. Further seasonal declines were anticipated, leading to a domestic shortage of Fatty Alcohol and increasing prices. In Indonesia, palm oil production fell by 2% in August 2024, exacerbating the supply issues. The government's decision to raise the palm oil content in biodiesel from 35% to 40% increased demand, further pushing palm oil prices up globally. Exports of palm oil products also dropped significantly, from 3,385 thousand tonnes in July to 2,241 thousand tonnes in August 2024, fuelling the rise in AES prices across the global market. Specifically focusing on India, the market witnessed the most significant price changes, with a 10% increase between the first and second half of the quarter. This price volatility can be attributed to seasonal factors, demand fluctuations, and supply chain disruptions.
Europe
In Q3 2024, the European Alkyl Ether Sulfates (AES) market saw a significant price increase, driven by several key factors. Rising production costs, particularly a 10% hike in feedstock prices like Ethylene Oxide and Fatty Alcohol, were major contributors. The surge in Fatty Alcohol prices was largely linked to ongoing challenges in the palm oil supply chain. In Malaysia, palm oil prices rose approximately 11% in late September 2024, following a 3.8% decline in production to 1.82 million tonnes. This trend is expected to worsen with anticipated seasonal declines, leading to a domestic shortage of Fatty Alcohol and further driving up prices. Similarly, Indonesia experienced a 2% decrease in palm oil production in August 2024, exacerbating supply issues. The Indonesian government's decision to increase the palm oil content in biodiesel from 35% to 40% has heightened global demand, further pushing prices up. Exports of palm oil products also saw a significant drop, falling from 3,385 thousand tonnes in July to 2,241 thousand tonnes in August 2024, which contributed to the upward trend in AES prices across Europe. Demand from the downstream FMCG sector remained moderate to high, supporting this pricing momentum. In terms of demand dynamics, the domestic market for AES remained firm, particularly within the surfactant sector. Market insights indicated that the surfactant industry performed well during this period, boosting demand for AES. However, new orders plummeted, leading to rapid depletion of backlogs and placing pressure on production across the region. This resulted in a slight decline in factory employment levels and reduced purchasing activity, as companies focused on inventory management. The downturn in the eurozone's industrial output reflects broader economic challenges, contrasting with the relatively stable demand for AES in sectors reliant on these products.
For the Quarter Ending June 2024
North America
In the second quarter of 2024, the North American market for Alkyl Ether Sulphates (AES) has witnessed a pronounced upward trajectory in prices, driven by a complex interplay of factors. One significant driver has been the unusually high temperatures experienced across the region, which have led to increased demand for surfactants in cleaning products. This surge in demand is particularly notable due to heightened outdoor activities during the season, resulting in elevated levels of dirt and grime that require effective cleaning solutions.
Adding to the price pressures, the cost of essential raw materials such as Ethylene Oxide has escalated. Plant shutdowns and production limitations of Ethylene Oxide have constrained the supply of AES throughout North America, exacerbating the upward trend in prices. These supply disruptions have been further compounded by ongoing port congestions, which have hindered export opportunities and exacerbated domestic supply-demand imbalances.
Despite these challenges, domestic demand for AES in the United States remained resilient. The warmer weather in June 2024 stimulated increased activity within the surfactant industry, reflecting consumer behaviour and economic vitality. Economic indicators, including a 0.2% rise in consumer spending according to the Bureau of Economic Analysis, underscored this uptick in economic activity. Meanwhile, the stability of the Personal Consumption Expenditures (PCE) price index following a slight increase in April suggested ongoing inflationary pressures, with a moderate year-over-year rise through May. In conclusion, the second quarter has marked a period of significant price escalation for AES in North America, driven by robust domestic demand amid supply constraints and economic dynamics shaped by seasonal factors and raw material costs.
APAC
The second quarter of 2024 witnessed a mixed market situation in Alkyl ether sulphates (AES) prices across the Asia-Pacific (APAC) region. Throughout this period, several critical factors contributed to the downward pressure on market prices. Firstly, a significant depreciation in the prices of feedstock Ethylene Oxide, which saw a reduction of approximately 4.2% in the East Asian market, directly impacted production costs. Additionally, the depreciation in prices of another key feedstock, Fatty Alcohol, by approximately 1.2% across East Asia further facilitated lower production costs for AES. The overall supply chain remained stable, albeit with sporadic bottlenecks due to congestion in major shipping routes, such as the Strait of Malacca, which occasionally caused delayed shipments. In India, the country experienced the most pronounced price fluctuations. Despite the generally balanced supply-demand equation, the Indian market faced a cumulative price decline due to several intertwined factors. The peak summer season traditionally drives up demand in the downstream soap and detergent sectors, but this year, the market saw an excess supply due to untimely arrivals of imports, resulting in stockpiles and subsequent price drops. Comparing the second quarter of 2024 with the same quarter last year, there was a staggering 48% reduction in AES prices, underscoring the persistent bearish market sentiment. From the preceding quarter in 2024, prices saw a modest uptick of 4%, attributed to a brief recovery phase. However, a comparative analysis between the first and second halves of this quarter revealed a 4% price drop, mirroring the overarching declining trend. Concluding the quarter, the price of Alkyl ether sulfates (AES) Ex-Taloja in India stood at USD 568/MT. Overall, the pricing environment in Q2 2024 has been predominantly negative, significantly influenced by depreciating feedstock costs, supply chain fluctuations, and seasonal demand variances. This persistent decline reflects an industry grappling with overcapacity and subdued economic conditions.
Europe
Throughout the second quarter of 2024, the market for Alkyl Ether Sulphates (AES) experienced a bullish trend marked by rising prices, driven by a confluence of significant factors. Despite Ethylene Oxide, a key feedstock for AES production, seeing a consistent decline in prices, the market for AES remained buoyant due to robust consumer sentiments. The warmer weather during this period amplified demand for cleaning products and surfactants, as outdoor activities increased and necessitated more effective cleaning solutions.
Internationally, there was a notable uptick in inquiries from markets such as the US and Europe, which further fuelled the upward trajectory of AES prices. This heightened demand was met with challenges stemming from increased costs of essential feedstocks like Ethylene Oxide and crude oil. These cost pressures escalated production expenses for AES manufacturers, contributing significantly to the overall rise in prices.
Moreover, global supply chain disruptions added another layer of complexity to the market dynamics. Issues such as elevated freight rates and logistical bottlenecks disrupted supply flows, leading to constrained availability of AES in the market and exacerbating the upward pressure on prices.
In summary, despite Ethylene Oxide prices declining, the second quarter of 2024 saw AES prices increase due to strong consumer demand driven by seasonal factors and heightened international interest. These demand pressures, combined with rising production costs and global supply chain disruptions, underscored the resilience and complexity of the AES market during this period.
For the Quarter Ending March 2024
North America
Throughout the initial quarter of 2024, the North American Alkyl Ether Sulphates (AES) market showcased a range of trends, reflecting diverse influencing factors. The supply of AES remained steady, with no reported disruptions in production facilities. However, demand for AES remained subdued, primarily attributed to sluggish performance in downstream sectors like surfactants and personal care. Additionally, the market felt the impact of global economic deceleration and persistent inflation, leading to reduced demand from international markets in Europe and Asia. These elements, coupled with ample inventory levels, exerted downward pressure on prices.
Among North American nations, the United States observed significant AES price fluctuations during the quarter. The US market trended bearishly, propelled by decreasing costs of key feedstock materials such as Ethylene Oxide and Fatty Alcohol. The decline in Ethylene prices notably influenced the downturn in AES prices in the US. Furthermore, anticipation of prolonged high interest rates within the country dampened domestic AES demand.
In summary, the North American AES market encountered challenges in the form of subdued demand, global economic slowdowns, and declining feedstock prices throughout the first quarter of 2024. These factors collectively contributed to a bearish market sentiment, particularly evident in the United States.
Asia
During the first quarter of 2024, the Alkyl Ether Sulfates (AES) market in the APAC region experienced a period of stability in pricing. The market situation remained steady, with a balance of supply and demand. However, various factors did influence the prices during this period. Firstly, there was an abundance of low-cost cargoes available from the exporting East Asian market, leading to increased supply levels. Additionally, the demand for AES from the downstream soap and detergent industry was moderate due to the off-season caused by the peak winter season. Lastly, the expected rise in production costs resulting from the increasing crude oil prices had an impact on the pricing trend. Across Asia, the prices of AES exhibited a bearish trend during the quarter due to the high supplies from the East Asian market. Fortunately, there were no reported plant shutdowns during this period. The trend, seasonality, and correlation of prices across Asia remained stable, showing no significant changes compared to the previous quarter.
Europe
During this quarter of 2024, prices of AES across Europe witnessed mixed market situation. During the initial month January 2024, prices of AES witnessed a depreciation of approximately 3.4%. Initially the European AES market was driven by low demand from downstream surfactant industries due to the prevailing winter season. However, during the starting of February 2024 till the end of March 2024, the European AES market received cost support from rising prices of Ethylene Oxide which appreciated by 2.5% during the months of February and March 2024, and the gradual revival of demand attributed to the arrival of spring season. Significant challenges in the supply chain system were also present during this time frame, due to strikes by Union Workers which resulted in limitations in transportation and logistics. This also may have contributed to the increments in the prices of the product. Normalization of freight charges at the end of this quarter also contributed to the positive procurement sentiments amongst the merchants based overseas and eventually turned export conditions somewhat favorable, despite the persisting crisis at the Red Sea.
For the Quarter Ending December 2023
North America
The Alkyl Ether Sulphates (AES) market experienced a predominantly bearish trend in the fourth quarter, marked by a nearly 3% decline in prices.
This downward trajectory was primarily influenced by sluggish demand from the downstream soap and detergent industry in North America. Additionally, the depreciation in prices of the key feedstock, Ethylene Oxide, by over 6%, contributed to the bearish market conditions for AES. The market was further influenced by the declining prices of Crude Oil, which experienced a significant drop of almost 16%. This, in turn, played a role in alleviating production costs within the industry. Despite marginal improvements observed towards the end of December 2023, driven by positive purchasing sentiments during the festive season, these efforts proved insufficient to significantly transform the AES market scenario.
Exports to the Canadian and Mexican markets remained subdued, contributing to the overall slowdown in the North American detergent and soap industry. The supply chain faced challenges due to adverse weather conditions, resulting in limitations in transportation and logistics. These challenges impacted the efficient movement of goods, creating additional hurdles for the AES market during this period.
APAC
The market for Alkyl Ether Sulphates (AES) experienced a bearish trend with prices depreciating by around 9%. This decline was primarily driven by the diminishing prices of the key feedstock, Ethylene Oxide, which itself experienced a depreciation of approximately 2%. In the APAC region, the demand from the downstream soap and detergent industry remained subdued during the winter season, exerting notable pressure on the AES market. Although there was a marginal uptick in prices in the latter half of November 2023 due to the peak festive season, which improved purchasing sentiments in the downstream FMCG industry, this positive influence did not significantly impact the overall market situation of AES. The market faced challenges with delayed cargo arrivals, contributing to an oversupplied market. This situation was exacerbated by the declining prices of upstream Crude Oil, which witnessed a global depreciation of almost 16%. The delays in cargo arrivals were primarily attributed to adverse weather conditions in the exporting European, US, and Chinese markets, where logistical and transportation challenges prevailed. Furthermore, the demand from the downstream soap and detergent industry remained subdued throughout the fourth quarter, coupled with depreciating prices of another feedstock, Fatty Alcohol.
Europe
Throughout the fourth quarter of 2023, Alkyl Ether Sulphates prices in the European market followed a bearish trend. This was primarily attributed to the devaluation of feedstock, with Ethylene Oxide and Fatty Alcohol experiencing depreciations of 5% and 7%, respectively, thereby alleviating production costs. Additionally, the global depreciation of upstream Crude Oil by over 16% further contributed to the reduction in production costs. The European market, overall, experienced a deceleration in the detergent and soap industry. Towards the end of December 2023, there were slight increments, driven by positive purchasing sentiments during the festive season. However, these improvements were marginal. Exports to the Eurozone market faced challenges due to worsening weather conditions, limiting logistics and transportation and impeding the flow of inventories. Towards the conclusion of 2023, prices witnessed an uptick as shipping charges increased, a result of conflicts at the Red Sea leading to heightened freight charges. Despite this, the demand from the downstream soap and detergent industry remained lackluster throughout the last quarter of 2023, primarily due to the prevailing peak winter season.
