Global Petrochemicals Industry to Witness Declining Prices
Published By : 19 Jan 2015 | Published By : QYRESEARCH
As per industry reports, the global petrochemicals industry which is valued at US$3 trillion fell by about 18% in December. This drop has been by far the biggest on a month-over-month basis since 2008 November. The main factors behind such a major decline are the continually falling prices of naphtha and energy. Also, the prices of petrochemicals spiraled from US$222 per metric ton in November 2008 to about US$984 in December.
In fact, this has been the lowest since 2009 June, a time which was witnessing recovery in the global markets from the global economic downturn. During the same month last year, the prices of petrochemicals were down by 30% on a year-on-year basis. It was also observed last month, that the prices of naphtha and crude had declined by more than 20%. An analyst also explained that the derivatives are most likely to follow when the prices of feedstocks fall so rapidly. He also stated that until the energy prices stabilize, the prices of petrochemicals are not likely to bottom out.
Between November and December, the monthly average naphtha prices and Dated Brent prices had declined by 23% and 21% respectively. Petrochemicals are generally used for manufacturing consumer products, and products like nylon, rubber, and plastic. These products are then utilized in the areas of aviation, construction, manufacturing, almost every commercial industry, electronics, and pharmaceuticals. A double digit decline in the prices of olefins was observed in the month of December. Olefins belong to that class of hydrocarbons which basically act as the building blocks to several petrochemical products that are utilized for manufacturing goods of daily use.