For the Quarter Ending September 2024
North America
The North American Paraffin Wax market experienced mixed trends throughout the third quarter of 2024. In the initial month, prices surged significantly due to supply shortages and elevated freight charges, which were largely attributed to ongoing logistical challenges and disruptions in supply chains. These factors heightened production costs and led to increased pricing pressures on Paraffin Wax. However, as the quarter progressed, prices began to ease. A slight reversal in freight charges, coupled with a decline in the price of essential raw materials, particularly Crude Oil, contributed to this downward price adjustment. As crude oil prices stabilized, the production costs associated with Paraffin Wax manufacturing decreased, allowing for more competitive pricing in the market.
Additionally, diminished demand from key end-user sectors, notably the cosmetics and candle-making industries, further supported the price dip. As consumer spending habits shifted and demand for non-essential goods waned, manufacturers faced increased inventory levels, prompting them to reduce prices to stimulate sales.
Consequently, the North American Paraffin Wax market reflects a complex interplay of supply-side challenges and changing consumer dynamics, resulting in a fluctuating pricing environment during the quarter. The latest quarter ending price of Paraffin Wax CFR Houston was reported at USD 1700/MT.
APAC
The third quarter of 2024 in the APAC region witnessed a notable decrease in Paraffin Wax prices, reflecting a challenging market environment. Several factors contributed to this downward trend, including a surplus in global supply, subdued demand from key industries such as cosmetics and candle-making, and logistical challenges like port congestion. These elements collectively resulted in price reductions, with China experiencing the most significant fluctuations. Initially, the rising cost of crude oil, a critical feedstock for Paraffin Wax production, exerted upward pressure on prices, prompting increased production rates. However, the prevailing lacklustre demand, both domestically and internationally, coupled with ongoing supply chain disruptions, led to a narrowing gap between supply and demand. This shift ultimately contributed to the observed price declines. Throughout the quarter, Paraffin Wax prices recorded a 4% decrease compared to the same period last year and a notable 5% drop from the previous quarter in 2024. Furthermore, the comparison between the first and second halves of the quarter indicated a 3% decrease, culminating in a closing price of USD 1,190 per metric ton (MT) for Paraffin Wax in China. This overall trend underscores the complexities facing the market as it navigates fluctuating supply and demand dynamics.
Europe
Throughout the third quarter of 2024, the Paraffin Wax market in Europe experienced a consistent decline in prices, with Germany witnessing the most significant changes. Several factors contributed to this downward trend. A notable reduction in demand from key sectors, including cosmetics and candle-making, coupled with ongoing trade uncertainties and logistical challenges, created an environment conducive to falling prices. Moreover, a surplus in supply—driven by stable production levels and limited international demand—further exacerbated the situation. Seasonal fluctuations, alongside the impact of global events on the supply chain, played a crucial role in shaping the overall pricing environment. Notably, compared to the same quarter last year, prices remained unchanged, indicating a stagnant market. However, when compared to the previous quarter in 2024, there was a 1% decrease, reinforcing the ongoing downward trend. In particular, the second half of the quarter saw a further price decline of 1% compared to the first half. As Q3 concluded, the price of Paraffin Wax (60-62) CFR Hamburg in Germany was recorded at USD 1,580 per metric ton (MT), underscoring the prevailing negative pricing sentiment within the market.
For the Quarter Ending June 2024
North America
The North American Paraffin Wax market experienced mixed market sentiments. The price increased during the initial month of the quarter by a margin of 1 % however, dipped further throughout the quarter. The increased price of essential raw material crude Oil during this period prompted increased production rates and energy prices thus exerting upward pressure on Paraffin Wax prices. The ongoing conflict between Israel and Hezbollah, along with drone attacks on Russian refineries, introduced considerable uncertainty into the oil market. These events heightened concerns about potential supply disruptions, leading to increased prices for crude oil and its derivatives, including Paraffin Wax.
The data indicated a significant surge in sales for leading players in the Western market, with sales growth exceeding 6%. Notably, L'Oréal, the world's largest beauty company, reported sales growth of over 12% in both North America and Europe, with its mass-market range and dermatological products offsetting weaknesses in the luxury segment. The increased sales of cosmetic products subsequently stimulated demand for Paraffin Wax, which is a vital ingredient in various cosmetic formulations.
However, prices dipped later. Throughout this period, the inflow of cargo was smooth, and no major hindrances in the supply chain were reported. Simultaneously, demand began to drop as consumers had already stocked up on inventories. While another prominent downstream the candle-making sector maintained steady demand, it was insufficient to offset the overall market weakness. Concluding the quarter, the price of fully refined paraffin wax (CFR-Houston) settled at USD 1803/MT.
APAC
The North American Paraffin Wax market experienced mixed sentiments in the second quarter. Prices initially rose by 3.1% in the first month but declined as the quarter progressed. The rise in essential raw material costs, particularly crude oil, led to increased production rates and energy prices, exerting upward pressure on Paraffin Wax prices. Geopolitical tensions, such as the conflict between Israel and Hezbollah and drone attacks on Russian refineries, introduced uncertainty into the oil market, heightening concerns about supply disruptions and causing crude oil and its derivatives, including Paraffin Wax, to become more expensive. Despite this, the increased sales of cosmetic products, particularly in the Chinese market, stimulated demand for Paraffin Wax, a crucial ingredient in various cosmetic formulations. Surveys showed significant growth for leading players like L’Oréal, with a month-on-month increase of over 50%, Head & Shoulders with a 68.7% rise, and Lancôme experiencing more than 50% growth. However, Paraffin Wax prices dipped later in the quarter due to elevated freight charges and port congestions, which deterred international buyers and complicated supply chain logistics, exacerbating the oversupply situation. Additionally, the anticipated seasonal demand increase from the candle-making industry did not materialize, leaving a significant supply-demand gap that pressured prices downward. South Korea experienced the most pronounced price fluctuations, with a steady decline in prices driven by high inventory levels and weakened demand, amplified by logistical challenges and port congestion. By the end of the quarter, Paraffin Wax prices stood at USD 1,308 per metric ton CFR Busan in South Korea.
Europe
In the European paraffin wax market, the market was volatile. The price rose 1% in the first month of the quarter but continued to decline during the quarter. The increase in the price of the most important raw material, crude oil, increased production volumes and energy prices during this period, which caused upward pressure on the price of paraffin wax. The ongoing conflict between Israel and Hezbollah and drone attacks on Russian refineries have brought considerable uncertainty to the oil market. Those incidents raised concerns about possible supply disruptions, leading to higher prices for crude oil and its derivatives, including paraffin wax. The research showed that the sales of the main players in the western market increased significantly, the sales growth was more than 6%. In particular, L'Oréal, the world's largest beauty company, reported sales growth of more than 12% in both North America and Europe, with its wide range and dermatology products compensating for weaknesses in the luxury segment. The increase in sales of cosmetics later increased the demand for paraffin wax, an important ingredient in various cosmetics. Later, however, prices fell. During this period, the inflow of goods was smooth and there were no major obstacles in the supply chain. At the same time, demand began to decline as consumers had already gotten their supplies. While there was continued demand in the other important candle sector, it was not enough to offset the overall weakness of the market. At the end of the quarter, the price of fully refined paraffin wax FD Surrey stabilized at USD 2,036/MT.
For the Quarter Ending March 2024
North America
The North American Paraffin Wax market exhibited a volatile nature throughout the first quarter of 2024, particularly in the USA market. Prices experienced a notable decline during the initial month of the quarter but saw subsequent increases as the quarter progressed.
Demand for Paraffin Wax from western countries was modest during the initial week of January, coinciding with New Year festivities, with modest purchases observed from downstream candle making sectors; however, this did not significantly impact Paraffin Wax prices. Conversely, prices surged significantly during February and March as anticipation for forthcoming Lunar New Year, Ramadan, and Easter festivities heightened. Concurrently, demand from the cosmetics and haircare segments also revived as the summer season approached.
Furthermore, the festive atmosphere prevalent throughout the quarter resulted in a noticeable slowdown in operational efficiencies within manufacturing facilities, as personnel adjusted their work pace to align with celebratory events. Consequently, this operational deceleration added pressure to the already constrained supply of Paraffin Wax during the period. As of the latest available data, the quarter-ending price for Paraffin Wax Cost and Freight (CFR) at Houston in the USA was recorded at USD 1851 per metric ton.
APAC
The Asian Paraffin Wax market displayed a volatile nature throughout the first quarter of 2024, with China and South Korea emerging as the most affected countries. Prices underwent a notable decline during the initial month of the quarter in the Asian market but subsequently experienced increases throughout the quarter. In January 2024, demand for Paraffin Wax from the Asian cosmetics and candle making market remained subdued, with no new bids or inquiries observed during this period. However, demand from importing western countries was modest during the initial week of January, coinciding with New Year festivities, although it did not significantly impact Asian Paraffin Wax prices. Contrarily, prices surged significantly during February and March as anticipation for forthcoming Lunar New Year, Ramadan, and Easter festivities heightened. Concurrently, demand from the cosmetics segment also revived as the summer season approached. Moreover, the festive atmosphere prevalent throughout the quarter resulted in a noticeable slowdown in operational efficiencies within manufacturing facilities, as personnel adjusted their work pace to align with celebratory events. Consequently, this operational deceleration added pressure to the already constrained supply of Paraffin Wax during the period. As of the latest available data, the quarter-ending price for Paraffin Wax Cost and Freight (CFR) at Busan in South Korea was recorded at USD 1313 per metric ton.
Europe
The European Paraffin Wax market displayed a volatile nature throughout the first quarter of 2024, with Germany and the U.K emerging as the most affected countries. Prices underwent a notable decline during the initial month of the quarter but subsequently experienced increases as the quarter progressed. Demand for Paraffin Wax from western countries was modest during the initial week of January, coinciding with New Year festivities, with modest purchases observed from the candle making and cosmetics markets; however, this did not significantly impact Paraffin Wax prices. Conversely, prices surged significantly during February and March as anticipation for forthcoming Lunar New Year, Ramadan, and Easter festivities heightened. Concurrently, demand from the cosmetics segments also revived as the summer season approached. Moreover, the festive atmosphere prevalent throughout the quarter resulted in a noticeable slowdown in operational efficiencies within manufacturing facilities, as personnel adjusted their work pace to align with celebratory events. Consequently, this operational deceleration added pressure to the already constrained supply of Paraffin Wax during the period. Additionally, the fluctuating price of the essential raw material, Crude Oil, led to heightened production costs, further exerting upward cost pressure on Paraffin Wax prices. As of the latest available data, the quarter-ending price for Paraffin Wax, Free Delivered (FD), at Surrey in the U.K was recorded at USD 2046 per metric ton.
For the Quarter Ending December 2023
North America
In the North American region, the Paraffin Wax market exhibited bearish trends throughout the final quarter of 2023, concluding in December.
This decline was predominantly influenced by diminished demand for Paraffin Wax in both domestic and international cosmetics and candle making markets, aggravated by the prolonged downturn in global crude oil prices. The decision to impose sanctions on Venezuelan Crude oil sales and exports impacted the global crude oil value, providing some relief to downstream industries. Furthermore, lacklustre international demand, coupled with persistent weaknesses in the domestic cosmetics and candle making sectors, exerted downward pressure on Paraffin Wax prices.
As the quarter progressed, Maersk's announcement of rerouting vessels away from Red Sea routes, opting for navigation around Africa's Cape of Good Hope, significantly increased tonne-miles. These strategic changes posed a multifaceted challenge for global trade, leading to a surge in inventories at ports. The redirection of shipping routes and the resultant increase in tonne-miles further contributed to the complex dynamics influencing the Paraffin Wax market, reinforcing the overall bearish trajectory during this period.
APAC
The Paraffin Wax market in the Asia-Pacific region displayed bearish trends throughout the concluding quarter of 2023, ending in December. This decline was primarily influenced by subdued demand for Paraffin Wax in both domestic and international markets, exacerbated by the prolonged downturn in global crude oil prices. The lacklustre international demand, coupled with sustained weakness in the domestic cosmetics and candle making sectors, contributed to a downward pressure on Paraffin Wax prices. Additionally, disruptions in the Red Sea, a critical trade route, further compounded the situation, leading to escalated ocean freight rates. As the quarter unfolded, global Major shipping companies such as Chinese Cosco and its subsidiary OOCL, along with Taiwanese Evergreen, temporarily suspended cargo transportation along the Red Sea route, a vital maritime corridor connecting Europe, Asia, and Africa amidst Yemen-Houthi attacks. This interruption rerouted commodities through alternative channels, resulting in delayed exports and a notable build-up of inventories at Chinese ports. The intricate interplay of these factors contributed to a narrowing gap between demand and supply, reinforcing the overall downward trajectory in Paraffin Wax prices.
Europe
In the European region, the Paraffin Wax market exhibited bearish trends throughout the final quarter of 2023, reaching a culmination in December. This downturn was primarily driven by a decline in demand for Paraffin Wax within both domestic and international cosmetics and candle making markets. The extended downturn in global crude oil prices further exacerbated these challenges. The imposition of sanctions on Venezuelan Crude oil sales and exports played a role in influencing the global crude oil value, providing some relief to downstream industries. Additionally, subdued international demand, coupled with enduring weaknesses in the domestic cosmetics and candle making sectors, contributed to the downward pressure on Paraffin Wax prices. As the quarter unfolded, attacks on Red Sea trade by Yemeni rebels heightened concerns about the safety of maritime traffic in the region, leading to disruptions in Red Sea trade. These disruptions are anticipated to have a significant impact on global supplies of various commodities, including Paraffin Wax. Shippers responded by imposing additional fees amidst the trade disruption in the Red Sea, prompting Asian consumers to exhibit hesitancy in making bulk purchases. Consequently, this situation has led to a notable increase in inventories within the European market. The intricate interplay of these factors contributed to a narrowed gap between demand and supply, reinforcing the overall downturn in the Paraffin Wax market.
