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The traditional peak season is approaching, and market speculation in the chemical industry is gradually picking up.

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2020-12-23

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　　With the traditional peak season approaching, the chemical market posted a modest rebound last week. The Chemical Price Index (CCPI) published by Chemical Online closed at 3,537 points, up 0.8%.

　　Among the 160 key chemical products monitored, 55 saw price increases, accounting for 34.4%; the top three products with the largest gains were butadiene, acetone, and methanol. Fifty products experienced price declines, representing 31.2%, with isopropyl alcohol, acetic acid, and naphthalene ranking as the three largest drops. The remaining 55 products remained stable, making up 34.4% of the total.

　　Looking at the price‑rise rankings, butadiene prices surged last week, climbing 9.7% over the course of the week and hitting a four‑month high. Gains in the international market bolstered domestic confidence, prompting Sinopec to raise its quotations. Although Liaoning Baolai has commissioned a new production unit, it has yet to begin output, and recent shipments from other producers have also been limited, keeping butadiene supply relatively tight. However, amid expectations of increased supply going forward, downstream inquiries remain subdued, suggesting that upside for butadiene prices will be constrained in the near term.

　　Recently, the acetone market has staged a modest rebound, ending a two-and-a-half-month downtrend. With the peak season approaching, downstream buyers have been replenishing their inventories, driving a narrow upward move in prices. Traders are quoting higher offers, but acetone prices remain relatively elevated compared with previous years, suggesting limited room for further gains in the near term. Downstream bisphenol A has also risen by 5%. At present, Sinopec’s Mitsui plant is undergoing maintenance, while Changchun Chemical’s unit is operating at reduced capacity, and Nantong Xingchen is shipping only modest volumes overseas, resulting in constrained BPA supply and upward price pressure.

　　Methanol prices at ports have edged higher. Recently, inbound shipments have tapered, leading to a decline in port inventories, while the futures market has rebounded, providing support to the spot market. Additionally, rising transportation costs have pushed prices up in some domestic regions. However, with numerous methanol plants resuming operations and downstream demand remaining relatively subdued, there is limited room for further price increases going forward.

　　Looking at the list of biggest decliners, isopropyl alcohol has once again topped the rankings. Despite the ongoing downward trend, plant operating rates remain relatively high, keeping supply fairly ample. With the easing of the pandemic, overseas downstream demand has stayed robust; however, rising international supply has constrained domestic exports. Looking ahead, prices have now approached the post‑holiday support level, and with demand still underpinned by the pandemic, the downside for the isopropyl alcohol market is expected to be limited.

　　Recently, the acetic acid market has surged before retreating. With plant maintenance now complete, industry operating rates have rebounded, easing earlier supply constraints. Market sentiment remains bearish, prompting a rational downward correction. Downstream, with the exception of PTA, other sectors such as acetic esters are posting production losses, resulting in low utilization and weakening demand. Meanwhile, export performance has been lackluster, and traders have been offering discounts to offload inventory, further weighing on acetic acid prices.

　　Following a modest uptick, the industrial naphthalene market reversed course and declined. Downstream phthalic anhydride producers operating via the naphthalene route are posting losses, with plant utilization rates falling and demand for raw materials weakening, leading to widespread bearish sentiment in the industrial naphthalene market. Meanwhile, coking‑tar prices have edged lower, eroding cost support. However, with deep‑processing facilities currently undergoing maintenance and industrial naphthalene inventories remaining relatively low, the outlook for the near term is expected to remain weak but broadly stable.

　　Overall, recent typhoon-related weather has constrained the availability of imported supplies for certain chemical products, leading to a decline in inventories. Meanwhile, with the traditional peak season of “Golden September and Silver October” just around the corner, downstream restocking is picking up, stoking speculative sentiment and driving a modest rebound in market prices. However, the end‑user export market remains sluggish, and demand growth remains relatively muted; as a result, the market is expected to trade within a narrow range this week.

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