Episode 1123: Red Sea effects provide impetus for shifting sentiment in Europe and US epoxy markets, amid margin struggles

After a prolonged stagnant period, the Europe and US epoxy resins markets are showing some signs of a firmer sentiment, due to Red Sea shipping effects and the need to restore profitability, although there has been no fundamental recovery in demand so far.
The Red Sea shipping disruptions and spiking freight costs for Asian export cargoes have led to more domestic demand opportunities in Europe and the US, particularly in Europe which is more exposed to the structural flow of Asian imports. 

This increase in domestic demand due to import delays for the most part have led to a firmer tendency. Although underlying demand in both regions is still fragile for macro-economic reasons, but expectations of interest rate cuts bring some hope for demand, but it remains unclear when this demand support will come. 

Europe ICIS Europe and US epoxy Senior editors Heidi Finch and Tarun Raizada analyse trends in their respective regions and discuss near term outlooks.

• US and Europe markets mainly stable in January, some slight firming on logistic impacts, margin recovery needs
• US epoxy sentiment mixed for February in a still competitive market, amid shaky demand, but logistic pressures
• Europe epoxy price talks firmer for February on Red Sea effects, need to restore profitability
• Supply no concern in Europe or US markets so far, but closely watched, amid logistic issues
• Some demand uplifts, but no fundamental recovery so far.