Paraffin wax Prices, markets & analysis
ICIS offers trusted and reliable market intelligence for those buying or selling Paraffin wax or related products in the global Paraffin wax market.
Our reporters across Asia, Europe and the US keep in touch with local markets, bringing you price assessments, in-depth news and analysis which you can rely on to guide you in your commercial decisions.
Our editor gives their expert view
Paraffin wax Overview Transcript
There are many uses for paraffin wax from cosmetics through to packaging. However the production of candles is by far the largest consuming sector for paraffin wax.
Paraffin wax is derived from slack wax, a by-product of Group 1 Base Oil production and is classified according to oil content, melting point and the amount of processing put in. There is little investment in Group 1 Base Oils production because of shifting global demand patterns.
Moreover paraffin wax faces challenges from possible natural alternatives such as soy and palm oil.
The price of paraffin wax can be influenced by upstream factors such as crude oil price fluctuations. In addition, demand for paraffin wax and candles can be influenced by wider economic concerns. These challenges along side the global nature of the business make it a complex market place.
Anyone involved in the paraffin wax business who wants to understand what is happening should read the ICIS report .
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Paraffin wax news and market information products from ICIS
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Paraffin wax: Market overview
Updated to Q2 2015
The US paraffin wax market continues to defy patterns in other global regions, with tightened supply a consistent factor in the US during the second quarter.
Tightening supply is the result of the exit of several wax production streams by the largest producer and also from production compression across the Group I base oils tier.
Production compression in Group I base oils is a result of greater presence of Group II, with the US now the dominant Group II supply region.
Low-meltpoint waxes, particularly fully refined 140F meltpoints, are in snug supply, while high-melt 150F fully refined are narrowly balanced to demand.
An influx of Chinese wax is taking place in the second quarter, but not expected to sustain itself going into the third quarter.
Demand for Chinese semi-refined slab wax will likely weaken as fully refined Chinese slab wax gains more favour among buyers in southeast Asia. Fully refined slab wax has a lower oil content, making it more suitable for the mass production of candles.
Prices for Chinese liquid wax will largely be stable-to-soft amid sluggish demand and thin trade. Demand for the material will be hit further if the euro continues to be weak.
The second quarter is expected to be quiet for the Indian domestic market, with demand only expected to pick up towards the end of the quarter. Wax prices are likely to be stable amid slow demand. Candle production will increase after the middle of the year and demand for candles is likely to remain strong until the major religious festival of Diwali in November 2015. The new wax refining unit at the Indian Oil Corp (IOC) Numaligarh refinery, due to open within the second quarter of 2015 in Assam state, may put pressure on the prices of Chinese material.
The outlook for European fully refined paraffin wax prices appears stable-to-firm. Reduced operating rates at Group I base oil refineries has tightened feedstock slack wax supply, while the weak euro has driven up the cost of imports. However, demand is seasonally low and any significant price increases may be delayed until around May, when the high season begins.
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Paraffin Wax Methodology
About Paraffin wax
Paraffin waxes are classified according to oil content, melting point, and the amount of processing put in. At room temperature paraffin wax can be found in a solid state, when it reaches 37°C and above the wax will begin to enter a liquid phase.
At the simplest level, slack wax, a byproduct of base oil refining, is the feedstock from which different grades of more sophisticated waxes are produced. Fully refined waxes are white, odourless and tasteless, and have less than 0.5% oil content.
They are widely used for candle making and in the packaging industry as wax coatings for paper, film and foil substrates including corrugated board, cups and container. Waxes are marketed in either liquid or solid state.
Other common uses are for corrugated boxes, waxed papers, frozen food cartons and wrappers, paper cups, candles, cosmetics, rubber antioxidants, lumber end seal, adhesives, protective coatings, food additives, cheese dipping, crayons, moisture barriers, polishes, modelling clay, plus many others.