LONDON (ICIS)--Demand in the European fully refined paraffin wax market remains below par for the time of year and the traditional seasonal price increase in September/October appears unlikely, sources said on Wednesday.
Sellers have been waiting for the pick-up in demand that would usually have emerged by late-August, but continue to be disappointed. In addition, supply is very healthy and all sources agree that prices are more likely to move down than up.
As well as high inventories that resulted from an abundance of low-priced Chinese imports in the first half of the year, the low demand may also be linked to availability of alternative feedstocks for candle making. A consumer said there is high availability of products such as palm-based waxes at attractive prices that may be impacting on paraffin demand.
Despite the apparent pressure on prices from weak fundamentals, most prices are holding steady. A refiner said it is discussing with customers material with a melting point of 56-58 at €995/tonne FD (free delivered) northwest Europe, although no deal had yet been done and the prospect of a lower price being agreed remains open.