Wholesale IPA Prices Soften Dramatically

June 4, 2020

Notice to Isopropyl Alcohol Customers:

In an ongoing effort to keep our customers informed, we are pleased to share that wholesale prices for Isopropyl Alcohol 99% have steadily softened over the past few weeks and recent supply/demand changes have only increased the rate of change. While we are making every effort to inform our customers of exact price changes in a timely fashion, we are also currently receiving an unprecedented volume of new quote requests.  If you have not yet heard from your account manager and would like to discuss current pricing for Isopropyl Alcohol, please don’t hesitate to let us know.  We will ensure your account manager follows up with you promptly.

COVID-19’s Impact On Chemical Supply Chains

April 8, 2020 COVID-19

The global COVID-19 pandemic has resulted in significant impact on chemical supply chains. Here we take a look at some of the chemicals that have been affected:

Isopropyl Alcohol (Isopropanol)

Sanitization products such as Isopropyl Alcohol have experienced skyrocketing demand. Unfortunately, manufacturers are simultaneously dealing with problems that are preventing them from supplying at full capacity. While two US producers are experiencing production issues, another is having trouble with raw material Acetone supply. A fourth US producer is scheduled to restart production of IPA, but this material will take a few weeks to come online. Meeting this unprecedented demand is proving to be a challenge, and prices have increased sharply.

A concerning trend has arisen in the IPA market in these unusual circumstances. IPA is in some cases passing through the hands of many distributors before it is finally delivered to the end user. At CORECHEM, our goal is to maximize the speed of product to the end user.

Ethyl Alcohol (Ethanol)

The Ethanol market essentially functions as two separate markets- Fuel Ethanol and Chemical, Food, and Pharmaceutical Grade Ethanol (Ethanol). These two markets are currently experiencing opposite extremes.

Most Ethanol plant startups in recent years have been tooled for Fuel Ethanol, creating an oversupply situation in the Fuel Ethanol market. Now, significantly reduced demand for fuel is compounding the oversupply problem.

Ethanol used for sanitization is experiencing record high demand. Prior to the COVID-19 crisis, Ethanol supply / demand was balanced. Now, prices are rising and supply is tight. Unfortunately, it is not easy for a Fuel Ethanol plant to switch over to creating Ethanol for other purposes.

Acetone

After years of a supply glut, the US Acetone market is tightening up. Acetone is a raw material used to produce Isopropyl Alcohol, now in high demand. Also, anti-dumping duty determinations have been finalized on Acetone being imported from five countries, resulting in imports from these countries stopping in November 2019.

Glycerin

Glycerin, a common ingredient in hand sanitizers and hand soaps, is also experiencing supply constraints and increased demand.  Glycerin is a co-product of bio-diesel fuel. Diesel fuel has experienced a significant decrease in demand, due to reduced travel and an overall slowed economy. As a result of less bio-diesel fuel being produced, less Glycerin is being produced. Also, fewer imports are entering the the U.S. market. Price increases are taking effect, and expected to continue for some time.

Medium-Chain Triglycerides (MCTs)

Medium-Chain Triglycerides (MCT’s) is another ingredient in hand sanitizers and hand soaps, and is experiencing significantly increased demand. Overseas plants that produce MCT’s have been shut down for employee safety, resulting in supply constraints.

Sodium Hypochlorite (Bleach)

Although Sodium Hypochlorite is experiencing increased demand due to usage as a disinfectant, reduced demand in other market sectors, such as downstream plastics, may more than offset the increase. CORECHEM continues to monitor the Chlor Alkali market (Sodium Hypochlorite and co-product Sodium Hydroxide) for noticeable supply / demand shifts.

Reach out to your CORECHEM sales representative to further discuss how these or other chemicals may have been impacted by the COVID-19 crisis.

UPDATE: ITC Deer Park Terminal Resumes Operations

June 6, 2019

A fire at the ITC Deer Park terminal in mid-March affected both supply and price of several commodity chemicals. Following a weeks-long cleanup process, in which over 20 million gallons of oily water were removed from the water and tank farm, the docks at ITC were approved for use in the first week of May. In addition, rail, truck & pipeline activity has resumed.

The reopening of shipping operations at the ITC Deer Park facility, a major storage facility for petrochemicals near Houston, TX, is normalizing supply chains of commodity chemicals such as Isopropyl Alcohol (IPA) and Methyl Ethyl Ketone (MEK).

CORECHEM looks forward to supplying your company! Contact your sales representative with questions about how this may affect you.

 

IPA On Hold While Houston Cleans Up

April 30, 2019

Oil Tanker Waits to UnloadA massive clean-up of the Houston Ship Channel has been underway since the fire event last month at the ITC – Deer Park terminal.

The Intercontinental Terminals Company is a major storage facility for petrochemicals, located on the Houston Ship Channel. Since the fire, waterways have resumed normal operations. However, according to a ‘Situation Report’ issued by the Coast Guard on April 19, ship and barge docks at ITC- Deer Park will remain closed until further notice.

What does all this mean for Isopropyl Alcohol?

Since no cargo can be offloaded until clean up is complete, both Isopropyl Alcohol (IPA) and the raw materials used to make IPA are in vessels waiting to unload. One IPA producer, Monument Chemical, has declared force majeure on IPA, stating that ‘delays will be inevitable’.

For the time being, the backlog in the Houston port has resulted in vessels being tied up, further reducing or delaying additional imports. Major U.S. IPA producers have announced price increases. The disruption could take a few months to resolve.

CORECHEM looks forward to making sure your company has the IPA supply you need! Contact your sales representative with questions about how this may affect you.

More information about IPA.