MDI and TDI tightness set to continue in the short term

The global isocyanates markets have been extremely bullish during the first quarter of 2017. This comes as a result of a series of both planned and unplanned outages in Europe and Asia, which have left the market very short of supply. As a result, prices have been continuously increasing throughout the year so far and the expectation is that the tightness is set to continue into the second quarter. Whether TDI buyers will continue to face such steep increases as they have seen in recent months is difficult to ascertain.

It has proved very tough for flexible foam producers to pass on increased costs downstream, and some buyers in China and the Middle East have taken a step back from the market. MDI buyers fully expect that the second quarter will prove very tough, and the supply squeeze seen over the past two months is unlikely to moderate until well into the third quarter. The upward trend in construction activity during the coming months will put further pressure on the system, as demand for MDI increases.

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Joyce Grigorey_web
Joyce Grigorey
Consultant – Polyurethanes & Intermediates, Olefins, Polyolefins
Phone: +44 207 924 3955

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