In May, the epoxy chloropropane market showed a “climbing” trend due to factors such as the rise in raw material glycerol prices, with prices continuing to rise. According to the monitoring and analysis system of Shengyi Society, as of May 30th, the benchmark price of Shengyi Society’s epichlorohydrin was 9700 yuan/ton, an increase of 7.78% compared to early May. By the end of May, approaching holidays, downstream market stocking had ended, and the epichlorohydrin market showed a stable to declining trend.
Price influencing factors:
Raw material side: In May, the market price of glycerol raw material increased, the low-priced supply decreased, and the supply was tight, which provided strong support for glycerol based epichlorohydrin enterprises and led to an upward trend in prices. As of May 27th, the price of 99.5% glycerol in East China was 7050 yuan/ton, an increase of 11.2% compared to May 6th. The market price of raw material propylene fluctuated weakly, and after mid May, the price of raw material propylene rose, coupled with some equipment being negatively charged, resulting in a short-term shortage of market supply. Overall, the tight supply of raw materials and the significant cost pressure caused by price increases have led to a continuous rise in the market price of epichlorohydrin. According to the monitoring and analysis system of Shengyi Society, as of May 30th, the benchmark price of propylene in Shengyi Society was 6538.25 yuan/ton, a decrease of -0.49% compared to the beginning of this month (6570.75 yuan/ton).
Supply side: Qingdao Bay glycerol plant or start-up, some factories are planned to restart after maintenance, and the market supply is sufficient. Overall, the operating rate remains at around 50-60%, with slightly loose supply.
Downstream demand side: In May, the downstream epoxy resin market showed weak demand, with rigid procurement being the main focus and a strong wait-and-see sentiment in the market. In addition, the pre holiday stocking has ended, overall inquiries have decreased, the trading atmosphere is cold, and the market has shown a downward trend, which has limited support for epichlorohydrin.
Market forecast: Analysts from Shengyi Society believe that with the end of pre holiday stocking and insufficient support from market demand, the high price of glycerol on the raw material side is under pressure, but demand follow-up is not smooth, and there may be expectations of a decline in market prices, which will limit support for epichlorohydrin. Overall, there is a lack of favorable supply and demand conditions, and it is expected that the focus of the epichlorohydrin market may decline in June. More attention still needs to be paid to changes in market supply and demand, as well as the dynamics of the raw material market.