Deepak Phenolics' Potential Production Plans in 2024-25 Could Shift MIBK Market Dynamic
%2Fhttps%253A%252F%252Fofbadmin.s3.ap-southeast-1.amazonaws.com%252Fnexizo%252Fproduction%252Fstrapi%252FChemicals_2_e177666201.png&w=1920&q=100)
Softening feedstock costs and high inventory have caused a price dip in MIBK. Another major market update at the same time is high expectations of a shift in market dynamics in 2024-25 due to Deepak Phenolics' potential production plans.
Chemical Price
- MIBK prices witnessed a decline today, with importers reducing prices by INR 5/kg. Current offers stand at INR 142++/kg Ex-Hazira and INR 141++/kg Ex-Kandla on 60-day credit terms.
- However, traders holding inventory are offering lower prices, quoting INR 140++/kg Ex-Kandla and INR 139++/kg Ex-Hazira for advance payment terms, due to liquidation pressures and expectations of further price corrections.
- Bulk deal interests are being floated around INR 135++/kg Ex-Hazira, but importers are reluctant to sell at these levels, according to a leading bulk buyer.
- The price drop is primarily attributed to the decline in feedstock acetone prices, lower replacement costs, and a significant inventory build-up at ports, as reported by market participants. Buyers are currently adopting a "just-in-time" procurement strategy, anticipating further price reductions as upstream crude oil and feedstock prices in China continue to soften.
Chemical Demand and Supply
- Despite favorable seasonal factors, MIBK prices are facing downward pressure due to high inventory levels at ports, falling acetone prices, and reduced replacement costs. Importers and traders are increasingly concerned about liquidation, as buyers are holding off on purchases in anticipation of further price drops.
- India’s monthly demand for MIBK stands at approximately 3.1 to 3.5 KT, with the country entirely reliant on imports to meet this demand. There are market speculations that Deepak Phenolics may soon venture into MIBK production, with output expected to commence in Q3. This development could potentially shift market dynamics in the near future, according to a market observer.
- The primary end-use sectors for MIBK include bulk drugs, rubber, flavors and fragrances, and paints and coatings. Demand from the bulk drug and rubber processing sectors remains strong, driven by seasonal factors. However, the paints and coatings segment has seen subdued demand due to off-seasonality, although this is expected to improve after September.
Chemical News
- In the global chemical market, upstream crude oil (WTI) prices rose by 1.24%, reaching $68.51 per barrel. Natural gas prices, on the other hand, dropped by 4.96%, landing at $2.16/MMBtu.
- FOB Korea benzene prices stood at $964/MT, while FOB Korea propylene prices were $830/MT. Feedstock CFR China acetone prices were recorded at $930/MT.
- Offers for downstream MIBK cargoes arriving by the end of September are in the range of $1,460 to $1,560/MT, depending on volume and payment terms.
Expert Opinion
- MIBK prices are expected to remain mixed this week due to weak market sentiment, high port inventories, and lower replacement costs. However, strong seasonal demand from rubber processing and the bulk drug sectors could provide some price support in the short term.
- Buyers are advised to continue with just-in-time sourcing strategies rather than building up inventory, as the market trend may not reverse immediately.
Daily Market Report
%2Fhttps%253A%252F%252Fofbadmin.s3.ap-southeast-1.amazonaws.com%252Fnexizo%252Fproduction%252Fstrapi%252FChemicals_2282da2674.png&w=3840&q=75)
Weak Pharma Demand Keeps Methyl Amines Prices Mixed; Agro Demand Expected to Rebound
In the domestic market, Methyl Amines prices have decreased by ₹1/kg, despite an uptick in feedstock methanol prices. Current offers for Mono Methyl Amine (MMA) 40% stand at ₹52++/kg, Di Methyl Amine (DMA) at ₹59++/kg, on advance payment terms. Several traders observed that domestic manufacturers like Balaji Amines and Alkyl Amines offered more competitive prices compared to imports, making them a preferred choice for buyers.
Read Story
%2Fhttps%253A%252F%252Fofbadmin.s3.ap-southeast-1.amazonaws.com%252Fnexizo%252Fproduction%252Fstrapi%252FChemicals_1_07379aaddf.png&w=3840&q=75)
GNFC Cuts Aniline Prices - Feedstock Trends and Seasonal Demand Shape Future Outlook
Today, GNFC, a domestic manufacturer, reduced Aniline prices by INR 4/kg to INR 145++ for tanker load, while barrel pack prices were at INR 158++ ex-Bharuch on advance payment terms. Importer and trader offers were lower, at INR 140++ ex-Mumbai and Kandla.
Read Story
%2Fhttps%253A%252F%252Fd86af0gufpxog.cloudfront.net%252Funsafe%252Fadaptive-fit-in%252F105x89%252Ffilters%253Aformat(webp)%252Fhttps%25253A%25252F%25252Fofbadmin.s3.ap-southeast-1.amazonaws.com%25252Fnexizo%25252Fproduction%25252Fstrapi%25252FMethyl_Isobutyl_Ketone_99671420d4.png&w=3840&q=75)
%2Fhttps%253A%252F%252Fd86af0gufpxog.cloudfront.net%252Funsafe%252Fadaptive-fit-in%252F105x89%252Ffilters%253Aformat(webp)%252Fhttps%25253A%25252F%25252Fofbadmin.s3.ap-southeast-1.amazonaws.com%25252Fnexizo%25252Fproduction%25252Fstrapi%25252FMethanol_2_65e8980f77.png&w=3840&q=75)
%2Fhttps%253A%252F%252Fd86af0gufpxog.cloudfront.net%252Funsafe%252Fadaptive-fit-in%252F105x89%252Ffilters%253Aformat(webp)%252Fhttps%25253A%25252F%25252Fofbadmin.s3.ap-southeast-1.amazonaws.com%25252Fnexizo%25252Fproduction%25252Fstrapi%25252FFuel_removebg_preview_3_5781903070.png&w=3840&q=75)
%2Fhttps%253A%252F%252Fd86af0gufpxog.cloudfront.net%252Funsafe%252Fadaptive-fit-in%252F105x89%252Ffilters%253Aformat(webp)%252Fhttps%25253A%25252F%25252Fofbadmin.s3.ap-southeast-1.amazonaws.com%25252Fnexizo%25252Fproduction%25252Fstrapi%25252FStyrene_Monomer_1_f8b72a3209.png&w=3840&q=75)
%2Fhttps%253A%252F%252Fd86af0gufpxog.cloudfront.net%252Funsafe%252Fadaptive-fit-in%252F105x89%252Ffilters%253Aformat(webp)%252Fhttps%25253A%25252F%25252Fofbadmin.s3.ap-southeast-1.amazonaws.com%25252Fnexizo%25252Fproduction%25252Fstrapi%25252FAcetic_Acid_e26907494c.png&w=3840&q=75)
%2Fhttps%253A%252F%252Fnexizo.ai%252Fassets%252Fbg-png-msite.png&w=3840&q=30)