For the Quarter Ending June 2023

North America

In the second quarter of 2023, the market for Salicylic acid in the United States experienced fluctuations. During the initial two months of Q2, prices demonstrated a stable increase driven by the dynamic interplay of supply and demand. Following the abandonment of the zero-covid tolerance policy, trade between Asia and the US expanded. With escalating demand from end-user suppliers, there emerged a moderate scarcity of Salicylic acid on the shelves of domestic warehouses, consequently triggering price inflation. However, by the beginning of June, prices began to decline significantly, leading to a substantial downward shift in the trajectory of salicylic acid within the US market. The closing price for Q2 2023 settled at USD 3065 per CFR Houston, reflecting an average quarterly decrease of 5.11%. Notably, due to unusually low purchases from end-user industries, domestic suppliers amassed significant inventories of salicylic acid, resulting in ongoing cost reductions within the domestic market. Additionally, the strengthening of the euro against the US dollar throughout the second quarter of 2023 contributed to a pricier sourcing of salicylic acid from Europe for US buyers, further contributing to the downward price trend. This, in turn, led to reduced US imports as companies grappled with surplus inventories. Major US container ports also experienced a decline in import cargo volumes.

Asia

The Salicylic acid market in the Asia Pacific region exhibited a mixed trajectory during the second quarter of 2023. From the start of Q2 until its midpoint, the market saw a consistent price increase due to steady domestic and international orders. China's exports enjoyed a stronger-than-expected market scenario in April, with sustained inquiries from both local and international markets, surpassing the average. Production rates were increased to replenish inventories and cater to the growing demand, further bolstering the market's stability. The rise in raw material prices, particularly for Benzoic acid, contributed to the upward trajectory. In China, retail and producer inflation remained subdued, with both consumer and industrial sectors struggling to recover from the pandemic's impacts. While exports witnessed a 3.9% year-on-year decrease, imports saw a 1.9% increase, driven by government efforts to stimulate the Chinese economy and boost domestic demand. However, as mid-Q2 approached, prices began to fluctuate and eventually experienced a significant decline. By the end of Q2 2023, the price reached USD 2900 per MT FOB Shanghai, reflecting an average quarterly decline of 4.84%. The surplus inventory of Salicylic acid prompted suppliers to reduce prices to clear stocks. This trend was reinforced by diminishing sales in end-user sectors and a lack of new inquiries from both domestic and international sources. Additionally, the prices of raw materials used in Salicylic acid production declined during June, further contributing to the drop in prices.

Salicylic Acid Prices: https://www.chemanalyst.com/Pricing-data/salicylic-acid-1373

Europe

In the second quarter of 2023, the European salicylic acid market witnessed price fluctuations. As the quarter began, prices increased steadily, driven by a balance between supply and demand. Europe's inflation rate decreased to 7.4% according to data. The unexpected decision by OPEC+ members to cut oil output positively impacted the market environment. Rising energy costs, production expenses, and soaring shipping costs collectively bolstered the market's resilience. However, by the third month of Q2 (June), prices began to depreciate rapidly, resulting in a substantial decline in the market for salicylic acid. As Q2 2023 concluded, the settlement price for Salicylic acid dropped to USD 3000 per MT CFR Hamburg, representing an average quarterly decrease of 5.24%. Germany's inflation rate also fell to 7.4% in March 2023, as reported by the Federal Statistical Office. The decrease in consumer demand within the end-user sector and suppliers' ability to meet local demands with existing inventories were significant contributors to the decrease in Salicylic acid import prices. The rise in Salicylic acid API production due to new plant establishments and the increased output of existing plants led to a greater supply of Salicylic acid API in the market, subsequently putting downward pressure on prices.


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