Asia ADA downtrend may continue on sluggish demand

04:01' PM - Wednesday, 31/10/2018

Asia’s adipic acid (ADA) spot prices have declined for three weeks in a row because of falling feedstock prices and sluggish downstream demand, with downward pressure likely to remain as the year-end market lull draws near.

Most offers for China-origin cargoes fell to the low-$1,300/tonne CFR (cost & freight) NE (northeast) Asia levels this week, but buyers were still reluctant to place fresh orders citing slower-than-expected demand.

“Demand was supposed to be strong in September and October, which are usually peak season. But this year, we did not feel [that it is] so,” a downstream user said.

“And the demand may dwindle further in coming months with the peak season winding down,” the end-user said.

Spot ADA prices for China-origin cargoes have shed $110/tonne since the start of October to $1,315/tonne CFR NE Asia on 24 October; while those from other origins declined by $40/tonne over the same period to $1,535/tonne CFR NE Asia, according to ICIS.

Softening prices of feedstock benzene have been weighing on market sentiment, with Asian ADA sellers trimming offers to entice buyers.

Spot benzene prices have plunged by more than $100/tonne since early October to around $770/tonne FOB Korea on 24 October, ICIS data showed.

“Feedstock prices fell too sharply. So we also have no alternative but to cut the prices,” a major Asian supplier said.

Supply in Asia is long with the addition of a new 70,000 tonne/year new ADA line in China in March or April. The line is owned by Taiyuan Chemical New Material Co.

Downstream demand is generally expected to slow down further in the coming months amid the intensifying China-US trade war.

Shrinking export orders for most Chinese finished goods caused by the trade war will inhibit export-oriented manufacturers to actively restock raw materials, which may eventually exert downward pressure on most chemicals.

“The impact of trade war starts to be felt by the industry. ADA prices may soften further once there is no support from demand side,” a regional trader said. - ICS -

Sponsor links (Provided by VIEPortal.net - The web cloud services for enterprises)
Thiết kế web, Thiết kế website, Thiết kế website công ty, Dịch vụ thiết kế website, Dịch vụ thiết kế web tối ưu, Giải pháp portal cổng thông tin, Xây dựng website doanh nghiệp, Dịch vụ web bán hàng trực tuyến, Giải pháp thương mại điện tử, Phần mềm dịch vụ web, Phần mềm quản trị tác nghiệp nội bộ công ty,