Phthalic anhydride prices fluctuated and fell in July 

According to the SunSirs’ commodity market analysis system, as of July 29th, the price of OX method phthalic anhydride was 6,650 RMB/ton, a 3.16% decrease from the 6,866.67 RMB/ton on July 1st. In July, OX prices and industrial naphthalene prices fluctuated downward, weakening the cost support for phthalic anhydride. Phthalic anhydride equipment maintenance in July led to a slight decrease in the operating rate of phthalic anhydride plants. Phthalic anhydride supply was sufficient, while downstream plasticizer prices fluctuated downward. Plasticizer plant operating rates decreased, weakening demand for phthalic anhydride. With sufficient supply and declining demand, phthalic anhydride prices fluctuated downward in July.

Phthalic anhydride costs were falling and supply was sufficient

As of July 29th, Sinopec's OX price quote was 6,800 RMB/ton, down 2.86% from 7,000 RMB/ton at the beginning of the month. Industrial naphthalene prices fluctuated downward, and so did OX prices, reducing the cost support for phthalic anhydride and increasing downward pressure on phthalic anhydride prices. Phthalic anhydride equipment continued maintenance in July, with plant operating rates between 65% and 69%, ensuring ample phthalic anhydride supply. This ample supply coupled with lower costs intensified downward pressure on phthalic anhydride prices in July.

Demand Side: Downstream production capacity declined, and  DOP prices fluctuated and fell

DOP plant operating rates dropped significantly in July, falling from 60% in June to around 40% in mid-June, with a slow recovery in the latter half of the month. According to the SunSirs’ Commodity Market Analysis System, as of July 29, the DOP price was 7,967.50 RMB/ton, a 3.53% decrease from the July 1 price of 8,259.17 RMB/ton. The decline in DOP operating rates in July, coupled with a decrease in plasticizer production, led to a volatile decline in plasticizer prices. This decline in plasticizer production, coupled with weak demand for phthalic anhydride, reduced support for phthalic anhydride price increases.

Future outlook:

Analysts of phthalic anhydride product data from SunSirs believe that on the demand side, plasticizer plant operating rates declined, plasticizer production decreased, and phthalic anhydride demand weakened. However, plasticizer plant operations resumed at the end of July, leading to an increase in DOP demand. On the supply side, phthalic anhydride plants continued to undergo equipment maintenance, resulting in sufficient phthalic anhydride supply. Regarding costs, OX prices declined, while industrial naphthalene prices fluctuated downward, reducing phthalic anhydride costs. Looking ahead, phthalic anhydride plant operating rates remain relatively stable, phthalic anhydride supply is sufficient, and downstream plants are resuming operations, leading to a rebound in phthalic anhydride demand. With this recovery in demand and lower costs, phthalic anhydride prices are expected to stop falling and rebound in the future.

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