Epichlorohydrin Price Trends and Market Analysis – Q2 2025

Regional Outlook: North America, Asia-Pacific, and Europe

Introduction

Epichlorohydrin (ECH), an essential chemical intermediate, plays a vital role in the production of epoxy resins, elastomers, water treatment chemicals, and surfactants. Its pricing is heavily influenced by feedstock dynamics (propylene and glycerol), demand from epoxy resin markets, freight rates, and global trade flows.

The second quarter of 2025 saw mixed regional performances across the North American, Asia-Pacific (APAC), and European markets. While North America registered a steady price increase, Asia-Pacific witnessed volatility with a late-quarter rebound, and Europe faced continued bearishness due to soft demand.

This article provides a detailed breakdown of the quarterly performance of Epichlorohydrin prices across regions, analyzing supply-demand dynamics, feedstock trends, logistical challenges, and trade movements shaping the market.

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North America Market Analysis

Quarterly Price Movement

• The Epichlorohydrin Price Index in North America increased by 3.2% quarter-on-quarter (Q2 2025).
• Prices settled at USD 2029/MT CFR USA by the end of June 2025.

This moderate upward movement was notable given the sluggish downstream epoxy resin market, weak demand fundamentals, and declining feedstock costs.

Demand-Side Dynamics

• Demand from epoxy resin producers remained subdued. The construction and automotive sectors, both heavy consumers of epoxy resins, showed only marginal recovery.
• Adhesives, coatings, and composite applications in the aerospace and electronics sectors continued to purchase selectively, preferring shorter-term contracts instead of bulk procurement.
• The slow recovery in North American housing starts and industrial output meant epoxy resin consumption did not support a stronger ECH price rally.

Supply-Side Factors

• Imports from South Korea surged during the quarter, providing adequate availability in the U.S. market. This created a buffer against local supply constraints and helped prevent sharper price hikes.
• Domestic producers operated at moderate rates, aligning production with downstream demand levels.

Feedstock and Cost Trends

• Propylene prices declined steadily across Q2 2025, reflecting lower crude oil costs and ample regional supply.
• However, freight and logistics expenses increased, offsetting some of the downward pressure from cheaper feedstocks. Rising container rates and congestion at U.S. ports contributed to higher landed costs.

Market Sentiment

• Despite the price rise, the overall market mood in North America remained bearish.
• Traders and buyers largely refrained from long-term commitments, instead waiting for clearer signals from epoxy resin demand.
• The 3.2% increase was more a reflection of import dynamics and freight-driven costs rather than strong demand growth.

Asia-Pacific (APAC) Market Analysis

Quarterly Price Movement

• The Epichlorohydrin Price Index in APAC increased by 1.9% in Q2 2025.
• Prices settled at USD 1220/MT FOB Ningbo by the end of June 2025.

This region showed volatility across the quarter, with early declines reversed by a late-quarter rebound.

Early Quarter Weakness

• In April and May, prices fell due to:
  • Weak demand from epoxy resin and coatings industries, particularly in China and Southeast Asia.
  • Declining feedstock costs, as both propylene and glycerol prices were on a downward trajectory.
  • Oversupply pressures, with regional producers maintaining steady operating rates despite lackluster demand.

Late Quarter Rebound

• By late June, prices recovered by about 1.4% compared to May.
• This rebound was driven by:
  • A rise in propylene and glycerol prices, providing cost-push support.
  • Reduced spot market availability as producers optimized inventories and diverted volumes to more lucrative export destinations.
  • Seasonal upticks in epoxy resin demand in South Korea, Japan, and parts of Southeast Asia.

Trade and Supply Considerations

• China remained the largest producer and exporter, although domestic consumption was under pressure from a slowing real estate sector.
• Export opportunities into India, South Korea, and Southeast Asia partially supported Chinese suppliers.
• Freight rate hikes across Asia-Europe and Asia-U.S. routes added further complexity, impacting arbitrage opportunities.

Regional Sentiment

• While the overall quarter showed only a modest 1.9% increase, the end-of-quarter firmness improved sentiment.
• Buyers, particularly in China and Japan, adopted a more cautious stance, balancing short-term needs with uncertainty about further feedstock-driven costs.

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Europe Market Analysis

Quarterly Price Movement

• The Epichlorohydrin Price Index in Germany declined by 2% quarter-on-quarter in Q2 2025.
• Prices settled at USD 1915/MT FOB Hamburg by the end of June 2025.

Unlike North America and APAC, the European market struggled with persistent bearishness, reflecting weak demand fundamentals and broader macroeconomic pressures.

Demand-Side Trends

• Demand from epoxy resin producers in Europe was soft.
• The construction industry, a key consumer of epoxy coatings, remained weak due to high borrowing costs and sluggish housing demand.
• Industrial manufacturing activity was subdued, while wind energy and automotive sectors offered only limited support.

Feedstock and Cost Pressures

• Similar to other regions, propylene prices declined, reducing production costs.
• However, logistical bottlenecks within Europe prevented sharper declines in ECH prices.
• Inland transport inefficiencies, river freight disruptions, and tight container availability all added extra costs to the supply chain.

Supply Availability

• European producers maintained steady operations but faced limited export opportunities, as Asian markets offered stronger arbitrage for ECH sellers.
• Imports from Asia remained competitive, further weighing on domestic price levels.

Market Sentiment

• The European market continued to face downward price pressure, but logistical challenges prevented prices from sliding further.
• Producers were caught between soft demand and higher logistical expenses, leading to narrower profit margins.

Comparative Regional Insights

Price Levels and Differentials

• North America: USD 2029/MT (highest among the three regions).
• Europe: USD 1915/MT (moderate, but under pressure).
• APAC: USD 1220/MT (lowest, reflecting abundant supply).

Market Drivers

1. North America: Import dynamics, freight costs, and relatively higher landed prices sustained values.
2. APAC: Feedstock volatility and late-quarter supply tightening pushed prices upward after earlier weakness.
3. Europe: Weak demand and declining feedstock prices pulled values down, though logistical hurdles limited deeper declines.

Demand Outlook

• Epoxy resin demand across regions remained lackluster, with limited short-term upside.
• While Asia is expected to lead eventual demand recovery, Europe continues to lag, and North America sits in a balanced but cost-sensitive position.

Outlook for Q3 2025

North America

• Prices may remain stable to slightly bearish if epoxy resin demand fails to recover.
• Import levels and freight rates will continue to be key influencers.
• A sharper rebound is unlikely without a significant recovery in construction and automotive industries.

Asia-Pacific

• APAC prices could experience further volatility, closely tied to feedstock propylene and glycerol movements.
• If China’s downstream epoxy resin sector stabilizes, spot market tightness may support higher prices in Q3.
• Export demand will remain a crucial balancing factor.

Europe

• The European market outlook remains cautiously bearish.
• Without a rebound in epoxy resin demand or improved macroeconomic conditions, prices may face continued downward pressure.
• Logistical constraints, however, could again prevent a free fall.

Conclusion

The second quarter of 2025 highlighted the regional disparities in Epichlorohydrin price movements.

• North America registered a moderate 3.2% increase, largely sustained by imports and freight costs rather than demand growth.
• Asia-Pacific witnessed volatility, with prices rebounding late in the quarter due to feedstock cost increases and supply tightening.
• Europe lagged behind, posting a 2% decline, pressured by weak demand and declining feedstock costs, though logistics prevented steeper falls.

Looking ahead to Q3 2025, the global Epichlorohydrin market will remain shaped by feedstock trends, regional demand recovery, and international trade dynamics. While North America may maintain stability, Asia-Pacific could see stronger volatility, and Europe may continue struggling with weak fundamentals.

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