On the 11th, domestic phenol factories raised their listing prices one after another, and Sinopec’s phenol price rose to 7850 yuan/ton. According to data monitored by Shengyi Society, the domestic phenol market price was 7750 yuan/ton on February 9th, and the market was quoted at 7850 yuan/ton on February 11th, with a two-day increase of 1.29% or 100 yuan/ton.

Supported by cost, the price of pure benzene has risen to a reference range of 7650-7750 yuan/ton. The expectation of large-scale equipment maintenance in the long term, coupled with tight supply in Shandong, has driven up prices. Supported by the upward trend of raw materials, the market has a positive attitude and increased participation in operations, resulting in an increase in phenol prices.

Supply expectations are tight. The second phase phenol ketone plant of Zhejiang Petrochemical is planned to shut down, and the operating rate of the phenol industry is only 80%. The enthusiasm for market inquiries has increased, and phenol enterprises have raised their listing prices. Sinopec’s phenol price has been implemented at 7850 yuan/ton.

On February 11th, the phenol offers in various mainstream markets across the country were as follows:

Region/ Quotation on February 11th/ Daily fluctuations

East China region/ 7800./ 50

Shandong region/ 7850./ 80

Surrounding areas of Yanshan Mountain/ 7850./ 100

South China region/ 7900./ 100

The downstream bisphenol A market remains stable with little market volatility. The upward trend of raw materials phenol and acetone has put pressure on the spot market of bisphenol A, resulting in less active shipping intentions and a decline in transactions. Other downstream products are gradually resuming production, and there is a stable replenishment of essential needs.

From the perspective of Shengyi Society, there is not much pressure on the short-term market supply side, and market prices may maintain a slight upward trend under the current upward trend. The terminal pays attention to downstream procurement strength and market transaction situation.

According to the Commodity Market Analysis System of Shengyi Society, as of February 10th, 85% formic acid in China was priced at 2950 yuan/ton, unchanged from the beginning of the year.

From an upstream perspective, with the gradual recovery of logistics after the Spring Festival, freight rates in various regions will further decline and tend towards normal levels; At the same time, considering the demand for inventory and replenishment in some traditional downstream areas after the Yuanxiao (Filled round balls made of glutinous rice-flour for Lantern Festival) Festival, it will further support the methanol market in the mainland.

On the demand side, after the Spring Festival, due to weak downstream market demand, the operating rate of compound fertilizer factories did not rebound quickly. Most factories are still executing preliminary orders and are not in a hurry to take on new orders. The factory’s shipment situation is average. At the same time, downstream distributors and grassroots growers are still in a wait-and-see attitude, and the sales atmosphere for formic acid is average.

The formic acid data analyst of Shengyi Society believes that the formic acid market is basically stable, and upstream products provide good support for the temporary storage of formic acid costs. The downstream pesticide industry has relatively stable demand for formic acid, and the sales situation is average.

After the Spring Festival, the market price of epichlorohydrin continued to rise. According to the monitoring and analysis system of Shengyi Society, as of February 7th, the benchmark price of Shengyi Society’s epichlorohydrin was 9050 yuan/ton, an increase of 0.56% compared to the beginning of this month.

Price influencing factors:

On the raw material side, the prices of propylene and glycerol have increased, leading to a rise in costs and providing strong support for the price of epichlorohydrin, resulting in a continuous increase in epichlorohydrin prices. According to the market analysis system of Shengyi Society, as of February 7th, the benchmark price of propylene in Shengyi Society was 6975.75 yuan/ton, an increase of 2.24% compared to the beginning of this month (6823.25 yuan/ton).

Supply side: During the Spring Festival, the market supply has decreased slightly. Some manufacturers, such as those in Fujian, Hubei, and Hebei regions, have installed devices to reduce production load or shut down, with a operating rate of about 37% during this period.

Downstream demand side: After the holiday, most of the downstream epoxy resin market has not yet resumed production, and some units have been shut down for maintenance or are in a reduced load state. Overall, there is a cold demand for epichlorohydrin, making it difficult to form favorable support. The price remains relatively stable, with a focus on stocking up for essential needs. It is expected to gradually resume normal operation next week, with an increase in demand for epichlorohydrin.

Market forecast: Analysts from Shengyi Society believe that the high prices of raw materials support the demand for epichlorohydrin. As downstream operations gradually return to normal after the holiday ends, there will be an increase in demand for epichlorohydrin. It is expected that the market price of epichlorohydrin may rise in the near future, with a range of around 100-200 yuan. More attention still needs to be paid to changes in market supply and demand.

The price of isooctanol fluctuated and rose in January

According to the Commodity Market Analysis System of Shengyi Society, as of January 31st, the price of isooctanol was 7800 yuan/ton, a fluctuating increase of 2.63% compared to the price of 7600 yuan/ton on January 1st at the beginning of the month. The construction of new equipment and the high level of equipment construction in isooctanol enterprises have led to sufficient supply of isooctanol. With stocking before the Spring Festival, the demand for isooctanol has rebounded, resulting in a double increase in supply and demand. In January, the price of isooctanol fluctuated and rose. After the holiday, the demand for isooctanol replenishment briefly rebounded.

Double increase in supply and demand of isooctanol in January

Isooctanol enterprises are operating at a high level, coupled with the continuous production of new octanol capacity, resulting in an increase in the supply of isooctanol. Before the Spring Festival, downstream manufacturers replenished their inventory, leading to an increase in demand for isooctanol and a greater driving force for its price increase.

Downstream plasticizer DOP prices fluctuate and rise in January

According to the Commodity Market Analysis System of Shengyi Society, as of January 31st, the DOP price was 8576.25 yuan/ton, a fluctuating increase of 4.25% compared to the DOP price of 8226.25 yuan/ton on January 1st at the beginning of the month. The rise in raw material prices has led to an increase in the cost of plasticizer DOP. Stocking up before the Spring Festival has led to an increase in demand for plasticizers. Supported by rising costs and demand, there is a significant driving force for the increase in plasticizers. After the holiday, the demand for plasticizers briefly rebounded due to restocking.

Future expectations

According to the data analyst of Business Society’s octanol product, in the future, the high equipment production of isooctanol enterprises, coupled with the production of new equipment, will alleviate the shortage of isooctanol supply and ensure sufficient supply of isooctanol; After the Spring Festival, the replenishment of stocks has ended, and the expected demand for isooctanol has weakened. The strong supply and weak demand of isooctanol are expected to lead to a weak and stable price trend in the future market.

Market Review of Maleic Anhydride in 2024

According to the Commodity Market Analysis System of Shengyi Society, the market price of maleic anhydride in China will fluctuate downward in 2024, with an average market price of 7860 yuan/ton at the beginning of the year and 6520 yuan/ton at the end of the year, a year-on-year decline of 17.05%. The highest point of the year occurred on January 2nd at 7890 yuan/ton, and the lowest point of the year occurred on November 18th at 6260 yuan/ton, with a maximum amplitude of 21.55%. The domestic maleic anhydride market will experience a significant decline in 2024.

According to the monthly K-bar chart data of the maleic anhydride market from Shengyi Society in 2024, the market experienced more fluctuations than gains, with 4 months of upward movement and 8 months of downward movement. The highest increase was in May, up 4.45%, and the highest decrease was in January, down 8.4%.

There will be two significant upward trends for maleic anhydride in 2024: temporary parking by Wanhua in the second half of May, coupled with maintenance by Dafeng Jiangning, resulting in a decrease in the supply of maleic anhydride spot goods, limited factory shipments, limited market circulation, and continuous price increases; In mid December, the Wanhua maleic anhydride production plant in Yantai unexpectedly shut down, resulting in a significant decline in the supply of liquid anhydride in the market. At the beginning of the week, the price of the main maleic anhydride factory increased by 1000 yuan/ton, and dealer quotes followed suit. However, after the resumption of production, the overall market situation of maleic anhydride is in a downward trend, mainly due to the continuous increase in domestic maleic anhydride market supply and the weak demand for unsaturated resins in the downstream market.

Market forecast for maleic anhydride in 2024

Cost aspect:

Raw material n-butane: In 2024, the n-butane market fluctuated widely, with a range of 5050-5400 yuan/ton. The n-butane market is mainly affected by significant fluctuations in the international crude oil market, coupled with the domestic naphtha market rising first and then falling, which provides limited cost support for the n-butane market.

Supply side: The production capacity of maleic anhydride in 2024 is 3.546 million tons, a year-on-year increase of 94.19%., The n-butane oxidation method has gradually replaced the benzene oxidation method as the main development trend. 2025 is a year of concentrated release of new production capacity for maleic anhydride, with an expected increase in capacity of over 2.33 million tons. The total effective production capacity of butane method will exceed 5 million tons per year.

Demand side: Maleic anhydride is commonly used in the production of unsaturated polyester resins (UPR), BDO (1,4-butanediol), curing agents, organic acids (including succinic acid, tartaric acid, malic acid, etc.), water treatment agents, and other products.

The unsaturated resin industry is still one of the largest demand areas for maleic anhydride, accounting for nearly 50%. In 2024, the situation of oversupply of UPR will continue, and most production enterprises will maintain a low operating state. The unsaturated resin market in 2024 will mainly fluctuate within a certain range. The main consumption areas of domestic UPR in 2024 are fiberglass composite materials, artificial stone, coatings, handicrafts, buttons, coatings, etc. According to data from the National Bureau of Statistics, from January to November, the investment in real estate development in China decreased by 10.4% year-on-year, with the decline expanding by 0.1% compared to the period from January to October. The cumulative area of newly started housing construction from January to November decreased by 23.0% year-on-year, and the decline expanded by 0.4% month on month; The completed area decreased by 26.2% year-on-year, and the decline continued to expand by 2.3%. The sales area of commercial housing from January to November decreased by 14.3% year-on-year, narrowing by 1.5% compared to January to October. Real estate investment continues to decline significantly, with a severe shortage of new construction projects. The demand for glass in the real estate sector continues to decline significantly, and the demand for unsaturated resin industry in traditional terminal industries has limited growth. According to data from the China Association of Automobile Manufacturers, from January to November, the production and sales of passenger cars reached 23.904 million and 20.257 million respectively, an increase of 4.4% and 4.7% year-on-year; The production and sales of new energy passenger vehicles reached 10.727 million and 9.594 million respectively, an increase of 37% and 41.2% year-on-year. This year, the average penetration rate of new energy vehicle production reached 44.9%, an increase of 10 percentage points compared to last year. With the continuous expansion of the new energy vehicle market, the demand for unsaturated resins in the automotive industry has increased.

In 2024, the domestic BDO market price experienced narrow fluctuations in the first half of the year and a rebound after a decline in the second half. The average price at the beginning of the year was 9535 yuan/ton, and the average BDO price at the end of the year was 8471 yuan/ton, a decrease of 11.16%. Overall, the domestic BDO trend showed weak fluctuations in the first half of the year, followed by a rebound after a decline in the second half. The overall price center of gravity and fluctuation range have both shifted downward, mainly due to fierce market competition under industry overcapacity pressure, with prices falling below the average cost line. The overall price trend is weak, and the volatility has decreased compared to previous years. The price difference between high and low ends is only 2200 yuan/ton, and the fluctuation range has further narrowed. In recent years, the BDO capacity in Chinese Mainland has shown a sustained and rapid growth trend. Looking back at the past, the initial BDO production capacity was only 76000 tons per year. However, after years of development and project construction, the existing BDO production capacity will be 4.821 million tons per year by 2024, and it is expected to reach 9 million tons per year by 2027, with an astonishing increase. The newly added production capacity has significantly exceeded the average level of the previous three years. This has greatly improved the market supply capacity, but also brought potential pressure of overcapacity to the market.

Market forecast: Currently, China’s real estate investment continues to decline significantly, and there is a serious shortage of new construction projects. The demand from traditional terminal industries has limited impact on the unsaturated resin industry; The implementation of the policy of scrapping and replacement in 2024 has played a significant role in boosting the automotive market. It is expected that the subsidy policy for the automotive market will continue to be implemented in 2025, which will continue to boost the automotive market and increase the demand for unsaturated resins in the automotive industry. In recent years, BDO, as an important basic chemical raw material for industries such as biodegradable materials, new energy vehicles, and thermoplastic elastomers, is expected to usher in new growth points in the industry. At present, the domestic maleic anhydride market is in a state of oversupply. In 2025, there will still be new production capacity for maleic anhydride in China. In addition, the maleic anhydride market is still in a loss making state. However, downstream demand for maleic anhydride is limited, and the imbalance between supply and demand in the market will continue to exist in 2025. It is expected that the domestic maleic anhydride market will mainly fluctuate widely in 2025.