The global demand for epoxy resin for the composites industry grew by 6% in Q1 2021, compared to Q4 2020, while it increased by 2.6% when compared to Q1 2020. The growth in first quarter 2021 in the epoxy resin market is due to the recovery in economic conditions and increase in demand across principal consumers. Epoxy resin prices on average grew by more than 80% in Q1 2021, compared to Q4 2020 due to the supply chain disruptions accompanied by increase in raw material prices. Epoxy is used in adhesives, paints and coatings, composites and other applications. In this section, we are covering the demand and price trends of epoxy in the composites industry only. The figure below depicts the change in demand and the price of epoxy in the past five quarters.
Figure 1: Global Quarterly Change in Epoxy Resin Shipment and Price Trends
The North American epoxy industry witnessed growth in Q1 2021 as compared to Q4 2020, due to increase in demand from major end use industries, and increase in wind energy installations generated demand for epoxy resin. Heavy snowfall and record breaking cold weather in Texas early in 2021 caused major companies like Olin and Hexion to shut their plants resulted demand supply imbalance and increase in price.
In Q4 2020, companies started normal production activities with a recovery in automotive production, aircraft deliveries, and wind energy installations. There was increased demand for epoxy resin as compared to Q3 2020. Prices were also increased primarily due to raw material price hikes.
The European epoxy resin market witnessed growth in Q1 2021, due to a growth across the primary markets like automotive and aerospace. The supply tightened significantly during Q1 2021, which was fulfilled from Asian suppliers. The various governmental, business and consumer responses to the post pandemic positively impacted the demand for several of the products, resulting in higher volumes and pricing.
In Q4 2020, the European epoxy resin market witnessed growth because of confidence gained in the economy, and a resumption of operational activities, such as aerospace deliveries and growth in automotive production. Business restructuring by corporates and government initiatives to the post pandemic helped companies to shift gears in order to align with the epoxy resin market. In Europe, there was a substantial increase in the demand for high-end premium cars / sports cars in Q4 2020.
The Asian epoxy resin market increased during Q1 2021, as Asian countries witnessed a growth in trade and production activities. Furthermore, the demand from different end use industries, such as automotive, electrical & electronics, and pipe & tank also increased, which created opportunities in the epoxy resin market. Explosions at epoxy resin plants in China resulted in a rise in the number of safety audits, interrupting the supply of resin which caused tension and anxiety in local enterprises, resulting in panic purchases and creating a demand-supply gap, while driving price increases.
In Q4 2020, the Asian epoxy resin market registered growth over Q3 2020, supported by growth in construction and infrastructure activities, increasing production of automobiles, and growth in other end use industries. In particular, domestic demand is speeding up the revival of damaged caused by COVID-19.
The price and demand analysis on above is published monthly for various regions. Lucintel analysts collect supply, demand and price data from various suppliers and consumers on a monthly basis and also analyzes news on supply and demand issues, production, and price trends. This allows Lucintel to publish unbiased assessments on price and demand movements to help you make confident business decisions on your negotiation or business issues.
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