Polyol Prices, Trend, Supply and Demand & Forecast | ChemAnalyst

During the fourth quarter of 2023, the North American Polyol market experienced a downturn characterized by a bearish price trend. This was primarily due to decreased demand and sluggish manufacturing activities within the Polyurethane segment. The decline in prices can be attributed to subdued consumption rates across various end-user industries. Initially, demand for Polyurethane materials from Automotive manufacturers was sluggish, partly due to decreased manufacturing activities amidst the United Auto Workers (UAW) strike.

Moreover, the support for costs declined for feedstock Propylene Oxide at the quarter's onset, as demand weakened from Glycol industries and upstream Propane stocks remained abundantly available. Midway through the quarter, Polyol inventory levels were sufficient in the market, yet demand remained subdued, particularly after Black Friday sales, and due to decreased retail sector sales and Automotive sector consumption.

Towards the quarter's end, cautious buying activities persisted among buyers. Ultimately, the combination of low demand from downstream industries and the introduction of bio-based Polyurethane negatively impacted petrochemical-based Polyurethane component consumption, leading to a nearly 30% decrease in prices compared to the previous quarter. At the close of Q4 2023, the price for Polyether Polyol MW 3000, µ 400-650 FOB Texas in the USA stood at USD 2130/MT.

In the Asia-Pacific region, the Polyol market similarly faced bearish conditions throughout Q4 2023, marked by low to moderate demand from downstream industries and a decline in manufacturing sector activities. This led to consistent price decreases during the quarter. Propylene Oxide prices declined due to stockpiling, stemming from reduced offtakes from Glycol industries. This reduction in production costs maintained firm Polyol production rates in the region.

Midway through the quarter, procurement activities decreased as winter arrived, and consumption rates for Polyurethane components and PU materials remained sluggish in the Automotive and manufacturing sectors. Towards the quarter's end, destocking practices by regional isocyanates producers, coupled with sluggish consumption rates, further pushed prices downwards. However, there was an improvement in Polyol consumption rates from the PU segment as the regional wood furniture market gained momentum alongside increased retail sector sales and improved PU foam consumption rates in the manufacturing sector. By the end of Q4 2023, Polyether Polyol MW 3000 FOB-Osaka in Japan hovered at USD 1284/MT.

Mirroring North America, the Polyol market in Europe exhibited bearish movements during Q4 2023, with prices declining steadily. Low demand from the Polyurethane segment and sluggish manufacturing activities during peak winter contributed to this trend. Moreover, decreased offtakes from domestic buyers and the shifting interest towards bio-based Polyurethane materials impacted demand negatively.

Midway through the quarter, Polyol supply rates remained firm in the regional market, supported by consistent shipping rates from European hubs. The Eurozone Manufacturing Purchasing Manager's Index indicated a contraction in manufacturing sector activities, further exacerbating market conditions. Towards the quarter's end, the European Wood Furniture market suffered due to a housing bubble burst, leading to decreased demand for wood furniture and a subsequent decline in Polyurethane foam demand from the manufacturing sector.

Consequently, the consumption of Polyurethane components diminished, and inventory levels remained high. Overall, Polyol prices witnessed a decline of approximately 22% in the region. At the end of Q4 2023, Polyether MW 3000, µ 400-650 FD Antwerp quotations in Belgium were accessed at USD 1880/MT.