How Rising Feedstock Methanol value is Affecting the Global Acetic Acid Market
In the global market, the supply of Acetic Acid remained constrained, which accounts for the increase in its prices. In China, the market remained strong, and prices were USD 756/ton Spot and USD 800/ton FOB when observed on April 1 with a week-on-week inclination of 2.8% and 1.3%, respectively. Downstream traders took the initiative by reducing the manufacturer’s inventories with the utilization of the existing ones. The downstream Ethyl Acetate market also surged with the reduction in operating rates of the plants due to the tightening supply. Feedstock Methanol inventories in Jiangsu, Zhejiang, Guangdong, and Fujian were up 6.29% at 729,700 MT when observed on March 23. Meanwhile, in India, the price of Acetic Acid was reduced to USD 746/ton. The price slipped due to sufficient supply and deteriorating market demand. The feedstock Methanol market was muted with weak sentiments due to limited buying interest among the traders. On April 1, Bushehr Petrochemical, Iran, had shut down its Methanol facility due to gas supply constraints on March 28 and is expected to be operational in the first half of April.
In Europe, the price of Acetic Acid showcased the increasing trajectory with strong demand from the downstream industries. As per the ChemAnalyst data, the cost of Acetic Acid surged to USD 747/ton in Germany. Domestic market trading activities accelerated with an increase in spot Methanol prices. Europe’s energy challenges increased with the surging Russia-Ukraine conflict impacting the Petrochemical market of Europe. Rising raw material prices squeezed the profit margin of major downstream Paint and Coating manufacturers. Increased exports of Natural gas to the European Nation (EU) and supply constraints in the domestic market surged the prices, impacting the Acetic Acid market.
According to ChemAnalyst, Acetic Acid's price will increase in the global market with an increase in its consumption from downstream Paint and Coating industries. Accelerating tension between Russia and Ukraine will be more likely to impact the feedstock Natural Gas market. In Asian, rising demand for downstream Purified Terephthalic acid (PTA) from the textile and packaging industries will benefit the acetic acid market. Export from China to other Asian regions, mainly India and South Korea, is expected to increase with revision in the prices for the overseas suppliers.
