For the Quarter Ending September 2024
North America
In Q3 2024, the North American Raffinate market experienced a notable increase in prices, driven by a combination of factors. The market saw a surge in demand from various downstream industries, including solvents and coatings, leading to a tightening of supply and pushing prices upwards.
Additionally, stable production levels at refineries and petrochemical plants contributed to the positive pricing environment. The quarter was marked by favorable economic conditions, supporting the Raffinate market and creating a bullish trend. In the USA, which witnessed the most significant price changes, the market dynamics were influenced by a steady increase in demand from key industries and stable supply levels.
Seasonal fluctuations and production priorities of refineries, focusing on gasoline and diesel, led to higher yields of Raffinate and subsequently impacted pricing. Noteworthy is the resilience of the market despite minor logistical disruptions and no reported plant shutdowns during the quarter. The overall trend in Q3 2024 showcased a positive pricing environment, with prices steadily increasing throughout the quarter. The quarter-ending price for Raffinate DDP Texas in the USA stood at USD 746/MT, reflecting a robust and strengthening market for the product.
APAC
In Q3 2024, the APAC region experienced a notable uptrend in Raffinate prices, driven by several key factors. Supply constraints due to maintenance and construction activities at various facilities led to a moderate decrease in availability, boosting prices. Additionally, the seasonal shift towards winter-grade gasoline production resulted in a temporary imbalance in supply and demand, further pushing prices upwards. The overall market sentiment in the region was positive, with increased demand from industries like paints, coatings, and cleaning solvents contributing to the price surge. China, in particular, witnessed the most significant price changes, with a 4% increase from the first to the second half of the quarter. The correlation between seasonal demand fluctuations and price adjustments was evident, reflecting a stable yet bullish market environment. Despite a +4% change from the previous quarter, the quarter-ending price in China stood at USD 700/MT of Raffinate FOB-Qingdao, signaling a strong finish to the period. No significant disruptions or plant shutdowns were reported during the quarter, further supporting the positive pricing trend observed in the region.
Europe
In Q3 2024, the Raffinate market in Europe experienced a notable decline in prices, with the Netherlands being the most impacted. Several factors contributed to this downward trend. Firstly, oversupply in the market due to increased production and reduced demand from the petrochemical sector led to pricing pressures. Additionally, weakening global economic conditions and decreased refining margins further pushed prices downwards. The seasonal shift towards lower energy demand also played a role in the declining prices. Comparing to the same quarter last year, prices saw a significant decrease, indicating a prolonged downward trajectory. Furthermore, the quarter-on-quarter change in 2024 showed a decline, reflecting the ongoing negative trend. The second half of the quarter saw a more pronounced decrease compared to the first half, emphasizing the intensification of price declines. Seasonal fluctuations and production priorities of refineries, focusing on gasoline and diesel, led to higher yields of Raffinate and subsequently impacted pricing.
Ultimately, the quarter concluded with Raffinate prices in the Netherlands, underscoring the prevailing negative pricing environment characterized by consistent decreases throughout the period.
For the Quarter Ending June 2024
North America
In Q2 2024, the Raffinate market in North America experienced a sustained decline in prices, driven by several factors. Across the region, a combination of sufficient inventories, tepid downstream demand, and subdued purchasing enthusiasm from terminal markets contributed to the weakened pricing environment. The overall bearish sentiment was compounded by cyclical market dynamics, including a typical end-of-quarter procurement slowdown and increased inventory levels as manufacturers aimed to manage their stock efficiently.
Focusing on the USA, which witnessed the most pronounced price changes, the market saw a consistent downward trend. This was primarily due to weak demand from downstream industries such as MTBE and MEK, as well as ample crude oil stocks that exerted continuous downward pressure on prices. Additionally, the USA's natural gas prices spiked, elevating production costs and further straining the market. The sentiment was exacerbated by sporadic plant shutdowns, although no major disruptions were reported for this period.
Throughout the quarter, seasonality played a role, with typical mid-year slumps in demand and increased restocking activity leading to significant price fluctuations. The latest quarter-ending price stood at USD 708/MT of Raffinate DDP Texas.
APAC
The second quarter of 2024 witnessed a pronounced downtrend in the Raffinate market within the APAC region, significantly influenced by an array of factors that exerted downward pressure on prices. The quarter was marked by a confluence of sluggish downstream demand, elevated inventory levels, and persistent supply imbalances. The consumption at terminal markets remained tepid, and the lack of active downstream purchasing further compounded the bearish sentiment. Enterprise shipments were constrained, leading manufacturers to continually reduce factory quotations to stimulate market participation. Despite these efforts, the subdued consumption and inadequate demand support resulted in a weakening of Raffinate prices.
Focusing on China, which experienced the most significant price changes, the overall trend demonstrated a consistent decline. Seasonal fluctuations played a role, with reduced working hours during the heatwave affecting production volumes and leading to lower demand for raw materials. The weak international crude oil trend and poor downstream gasoline demand exacerbated the situation, with operators resisting high-priced gasoline raw materials. High operating rates in Raffinate production facilities contributed to excessive supply, further intensifying the supply-demand imbalance.
Comparing the first and second halves of the quarter culminating in a quarter-ending price of USD 670/MT FOB-Qingdao. This consistent decrease reflects a negative pricing environment, driven by multiple adverse factors, including subdued downstream inquiries and high inventory levels. The overall sentiment in the Raffinate market during this quarter was decidedly bearish, with the market grappling with significant headwinds and no major plant shutdowns reported to provide any relief from the oversupply situation.
Europe
In Q2 2024, the European Raffinate market experienced a notable decline in prices, influenced by several critical factors, creating a generally negative pricing environment. The primary factor was the significant drop in upstream crude oil prices, which directly impacted Raffinate's valuation. This decline in crude oil prices was driven by a combination of oversupply and weakening demand. Geopolitical tensions, particularly in the Middle East, exacerbated the situation by disrupting supply chains, while economic uncertainties in major markets, including Europe and the US, restrained industrial demand. Furthermore, increased Raffinate supply from regions like the US Gulf Coast and the Arab Gulf, driven by arbitrage opportunities, contributed to the downward pressure on prices. High inventory levels, subdued purchasing activity, and cautious market sentiment due to inflationary pressures and economic sluggishness also played significant roles.
Focusing on Germany, which witnessed the most substantial price changes, the overall trend in Q2 was characterized by a marked decline. The seasonal demand uptick typically expected during this period failed to materialize, largely due to weak downstream demand from sectors like petrochemicals. The correlation between declining crude oil prices and Raffinate was evident, reflecting the interconnectedness of these markets. Compared to the same quarter last year, Raffinate prices in Germany decreased by an impressive 15%. This stark contrast highlights the negative shift in market sentiment and economic conditions. In comparison to the previous quarter in 2024, however, the price change was recorded at 0%, indicating a stabilizing albeit low market environment. Within Q2 2024 itself, the first half of the quarter saw prices decline by 3% compared to the second half, evidencing a continual negative trend.
Overall, the Q2 2024 pricing environment for Raffinate in Europe, and more specifically in Germany, was decisively negative, driven by a convergence of oversupply, weak demand, and economic uncertainties, leading to significant price reductions.
For the Quarter Ending March 2024
North America
In Q1 2024, the North American Raffinate market experienced a blend of factors that impacted market prices, maintaining a relatively stable sentiment with moderate supply and demand dynamics. The pricing of Raffinate was influenced by several key elements, including upstream crude oil prices, demand from downstream industries like MTBE and MEK, and the costs of production inputs such as Natural Gas and Coal.
In the USA, Raffinate prices exhibited significant fluctuations throughout the quarter. Beginning at a lower level due to weak demand from downstream industries and declining feedstock crude oil prices, prices gradually rose as the quarter progressed. Factors contributing to this incline included restocking activities, increased demand from overseas markets, and rising production costs.
The evident correlation between Raffinate prices and upstream crude oil prices underscored the impact of market shifts, with rising crude oil prices prompting a corresponding increase in Raffinate prices. Moreover, the market's seasonal nature played a role in price fluctuations, with heightened demand during the quarter and restocking activities contributing to price hikes.
Comparing the first and second halves of the quarter revealed an overall upward trend in prices, with a positive change from the previous quarter in 2024 indicating an increase in Raffinate prices. The quarter-ending price for Raffinate in the USA stood at USD 768/MT DDP Texas, reflecting a relatively stable pricing environment.
APAC
In Q1 2024, the pricing of Raffinate in the APAC region witnessed upward trends influenced by several factors. Primarily, the rise in Naphtha prices, a key feedstock, contributed to the overall increase in Raffinate prices. Moreover, higher inventories from the Chinese market led to increased domestic inventories costs in China as China top exporter of raffinate to India. The stability of feedstock crude oil prices further reinforced this trend, while stable natural gas prices contributed to lower production costs for Raffinate.
In China, the largest market for Raffinate in the region, prices experienced a decline of approximately 5% compared to the previous quarter. This decrease was driven by the decline in feedstock crude oil prices and subdued demand from downstream industries like MTBE and MEK. Despite this decline, overall market sentiment remained stable, with expectations of future price increases driven by anticipated restocking activities.
Overall, Raffinate prices in the APAC region were influenced by seasonal factors, with stable demand from the construction industry and consistent inquiries from downstream sectors. However, demand from overseas markets remained relatively low, resulting in fewer overseas inquiries.
The pricing environment for Raffinate in the APAC region during Q1 2024 remained stable with a slight downward trend. Factors such as the decline in feedstock crude oil prices and subdued demand from downstream industries influenced market prices. Nevertheless, expectations of future price increases driven by restocking activities and stable demand from the construction industry suggest a positive outlook. The latest quarter-ending price for Raffinate in China was reported at USD 774/MT FOB-Qingdao.
Europe
The European Raffinate market presented a surprising trend in Q1 2024. Despite a significant rise in global crude oil prices, Raffinate prices witnessed a decline. This seemingly contradictory phenomenon can be attributed to contrasting forces impacting upstream and downstream sectors.
On the upstream side, several factors fuelled the surge in crude oil prices. Geopolitical tensions in the Middle East, combined with sustained production cuts by OPEC+ and projections of robust demand, drove crude oil to multi-month highs. The war in Ukraine, potential supply disruptions, and expectations of economic growth in major economies like China and the US all contributed to this bullish sentiment.
However, the downstream Raffinate market displayed a different story. High inventory levels and subdued demand from downstream industries countered the upstream price pressure. This disconnect highlights a potential mismatch between crude oil production and refined product consumption.
Despite the Raffinate price decline, the overall sentiment surrounding crude oil remains positive. Geopolitical tensions and robust global demand projections continue to exert upward pressure, with potential interest rate cuts by central banks fostering optimism about future oil consumption. This complex interplay of factors suggests a dynamic market environment in the coming months.
For the Quarter Ending December 2023
North America
The Raffinate market in the North America region during the fourth quarter of 2023 experienced various factors that influenced pricing trends. Firstly, the market saw a moderate supply of Raffinate due to steady operating capacity of plants and higher inventories. This led to a saturated market with excess stock, resulting in discounted prices.
Secondly, the demand for Raffinate was low to moderate, with the Purchasing Managers' Index indicating contraction in the manufacturing sector. However, there was robust domestic demand from downstream industries such as MTBE and MEK. Lastly, the prices of Raffinate in the USA decreased by 13% compared to the previous quarter, primarily driven by declining crude oil prices and weak demand from the downstream industries. There were no major plant shutdowns reported during this quarter. Focusing on the USA, the prices of Raffinate experienced a decline of 13% from the previous quarter.
Additionally, there was a 27% increase in prices compared to the same quarter in the previous year. The price comparison between the first and second half of the quarter showed an 8% decrease. The latest price of Raffinate DDP Texas in the USA for the current quarter is USD 698/MT. In conclusion, the Raffinate market in the North America region during the fourth quarter of 2023 was influenced by factors such as supply saturation, weak demand, declining crude oil prices, and the performance of the manufacturing sector. The USA experienced a decrease in prices compared to the previous quarter, but an increase compared to the same quarter in the previous year.
APAC
In the APAC region, the Raffinate market in the current quarter of 2023 (Q4) witnessed several significant factors that impacted prices. Firstly, the presence of high inventories in the market dampened the growth of the raffinate market. This was further exacerbated by reduced demand from downstream industries such as MTBE and MEK.Secondly, the prices of feedstock crude oil experienced fluctuations, with a general trend of increase throughout the quarter. This rise in crude oil prices led to an overall increase in the upstream raffinate prices. Lastly, demand from international markets remained subdued, except for stable demand from Singapore. In China, which experienced the most significant changes in raffinate prices, the market situation was relatively stable. The supply of raffinate remained moderate, with plants operating at regular capacities and maintaining sufficient inventory levels. However, the demand from downstream industries like MTBE and MEK was moderate, contributing to the overall stability of the market. The prices of raffinate in China experienced a slight decrease of 3% in the second half of the quarter compared to the first half. Additionally, there was a decline of 8% in raffinate prices compared to the previous quarter of 2023. Despite these fluctuations, the raffinate prices in China remained relatively steady throughout the quarter. In conclusion, the raffinate market in the APAC region faced challenges due to high inventories, reduced demand from downstream industries, and fluctuations in feedstock crude oil prices. In China, the market remained stable, with moderate supply and demand. The raffinate prices in China decreased by 3% in the second half of the quarter compared to the first half, and there was an 8% decline in prices compared to the previous quarter. The quarter ended with the latest price of USD 765/MT of Raffinate FOB-Qingdao in China.
Europe
In Q4 2023, the European Raffinate market displayed a highly dynamic and contrasting performance with significant price variations. The quarter began with a downward trend influenced by weak demand in key downstream industries like MTBE production, ample inventory reserves, and fluctuating naphtha prices. Mid-quarter, the market experienced volatility due to regional variations, geopolitical uncertainties in Eastern Europe, and short-term supply disruptions causing temporary price spikes. Towards the end of the quarter, prices exhibited a slight upward trend driven by a seasonal increase in demand for fuel components during winter months and cost pressures from rising energy and transportation costs. Regional variations were evident, with Western & Central Europe having generally higher prices due to elevated demand, transportation costs, and concentrated industrial activity, while Eastern Europe had lower prices due to lower demand, proximity to production facilities and reduced transportation costs. The impact on downstream industries resulted in lower raffinate prices benefiting users like fuel and chemical producers, especially those facing cost pressures. For raffinate producers, mixed price movements likely influenced profitability, creating a varied landscape depending on production costs and market dynamics.
