Slow-Moving Demand of Toluene Leading to the Worldwide Plunge in its Prices
The global toluene market persisted to come down for the week one of August 2022 and settled at an average barge price of US 5.22 per gallon, which was a dip of around USD 0.5000 as compared to the last week of July 2022. The requirement of solvent utilising had been strong, but it seems to be going down since the mid of summer. Though the toluene market was continuing to be vigorous however, the market has been witnessing a downtrend during the last two months.
In China, the toluene prices on August 03, 2022, was at 7697.75 and came down to 7450 Yuan/mt within a week (August 10, 2022).
The prices of Asian toluene soared from USD 11 per tonne to USD 950 per tonne ‘free on board’ Korea on July 20, 2022, and plummeted from USD 2 per tonne to USD 997 per tonne ‘Cost and freight’ China, since in the second half of August 2022, the buying interest of cargoes forced the market to a minor backward arrangement as compared to a flatter situation in the previous times.
The prices of toluene were up by USD 0.9850 for in May 2022, and again rose by USD 1.3675 per gallon in June 2022. Toluene, nevertheless, saw a dip in its prices by USD 0.5100/gallon in the early July 2022.
There has been a negative impact of recession and price increases that had its effect on the prices of various goods and services, that includes toluene too. According to the current study, the prices of toluene have decline across the world. The main reason behind dip in the toluene price is the lesser demand and low cost of the raw material.
Amid slow demand, the global perplexing crude oil prices fell to USD 95-100/barrel, this adversely affected the price curve of the raw materials Benzene and Xylene includes the other components for the decline in the national market. Therefore, this resulted into toluene prices example, Mumbai were extended at INR 91900/MT in the week of August 05, 2022.
In addition, the prices of toluene in the United States came down in the scenario of increasing supplies and restricted demand from downstream industry. Also, the production activities have shrunk in the United States toluene market and Purchasing Managers' Index (PMI) moved to the bottom level in comparison to the last month.
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Furthermore, there are assumptions about the upcoming recession in the United States that have strengthened in the last few months, which is diminishing the customer outlook. Because of this, the toluene prices in the United States were evaluated at USD 1770/tonne and a t on a weekly basis of about 4.6% on July 22, 2022.
Additionally, the main importer of toluene in Europe (Netherlands) is the United States and hence due to the vulnerable prices of the imported cargoes from Europe which further let to the downfall of toluene prices in the United States market. therefore, because of this toluene ‘Free on Board’ Texas prices were cited at USD 1520/MT in the prior week.
In the German market the prices of toluene dipped by 1.2% throughout the week concluding July 22, 2022. Ever since the starting of July 2022, the market in Europe has been witnessing a downfall in the Euro versus the US dollar. The developing assumption over a recession in Europe and the elevated price hike rate has been modifying the economy in Europe and leading to the dip in Euro.
The overall European market, unexciting demand from the solvent and building sectors have led to the decrease in the toluene prices in the national market. Besides, the stiff supply of natural gas is decelerating down the manufacturing actions which is additionally impacting the prices of toluene through Europe.
As per Procurement Resource, “there will be a tendency of price decline trend of toluene across the global market together with a downfall of prices of raw material. In the meantime, toluene demand from end-user sectors like construction and solvent would continue to be weak. Also, the estimated recession in the United States and Europe will further impact the prices of toluene in their respective domestic market.”