The Asian and European melamine markets have experienced downward pressure since the first quarter of 2012 as a result of supply disruptions and weak markets. In the US, however, tight supply and increasing demand have caused prices to rise.
Demand from the construction industry in the US has strengthened significantly as the economy recovers from recession. Demand in Europe, particularly in northern countries, has been steady while supplies have been tight. Asian demand has been soft through the second and third quarters of 2012.
US melamine prices have increased by about 10% between the first and fourth quarters of 2012. Further price increases are possible in the first quarter of 2013 as supplies remain tight while demand increases.
Spot prices in Europe have increased in recent months as supplies have tightened because of production outages. An improving supply situation in the fourth quarter of 2012 should help provide stability to the market.
Asian market players remain uncertain about the demand outlook and consider recovery dependent on the outcome of the eurozone crisis, as end-users often sell melamine products to Europe.
Updated to mid-November 2012