Price trend

According to the SunSirs commodity market analysis system, the domestic East China TDI market saw its gains reversed in August, continuing its downward trend. The average TDI price at the beginning of the month was 16,666 RMB/ton, and on August 29th, it was 14,700 RMB/ton, a monthly decrease of 11.8% and a year-on-year increase of 2.44%.

Influencing Factors

The TDI market was quite mixed in August. On the one hand, supply remained tight. On the other hand, high prices discouraged downstream investors from entering the market, leaving only rigid demand as support. A major TDI plant in Hebei Province scheduled a temporary shutdown for approximately seven days in mid-August for maintenance. Due to tight supply, a major plant in Shanghai wa not accepting new orders. Wanhua's new Phase II TDI plant (360,000 tons/year) at its Fujian Industrial Park recently completed construction and began production, producing qualified products. Force majeure at a German TDI plant lasted longer than expected, prompting a major Shanghai plant to reduce its China supply by 10% this month to support the European market. Suppliers remained willing to maintain prices, but downstream investors were cautious, resulting in a lack of firm orders. Intermediaries were rapidly profiting, and as a result of the supply-demand dynamics, the center of TDI transactions continued to shift downward.

On the supply side: Yantai Wanhua's TDI unit began shutting down for maintenance on August 19th, expected to last approximately 40 days.

Upstream toluene prices weakened in August due to oil prices and supply and demand. From August 1st to 29th, the domestic toluene market price fell from 5,570 RMB/ton to 5,489 RMB/ton, a 1.42% decrease over the period. Toluene's weak performance was driven by the negative macroeconomic environment of crude oil.

Market outlook

TDI data analysts of SunSirs believe that after a period of decline, the TDI market has gradually narrowed its decline. As the end of the month approached, it should pay close attention to the settlement prices of major manufacturers. It is expected that the TDI market will fluctuate narrowly in the short term.

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