Price trend

According to the SunSirs's commodity market analysis system, the price of polyaluminum chloride (PAC) in February was consolidating. On February 28th, the main price for solid PAC (industrial grade, content ≥28%) in China was around 1,720 RMB/ton, unchanged from February 1st. The water treatment market in China's main producing areas had ample supply, with downstream procurement based on immediate needs. The price of raw material hydrochloric acid and fuel prices declined, leading to a decrease in PAC costs. Demand was low around the Spring Festival, with municipal/industrial projects slowing down procurement and reducing inventory. In the initial post-holiday period after work resumption, demand gradually recovered, but overall procurement volume was limited, mainly consisting of small orders.

Market analysis

Raw material hydrochloric acid: In February, the domestic hydrochloric acid market declined, and as of February 28, the price of hydrochloric acid was 75 RMB/ton.

Liquefied natural gas (LNG) for production. Domestic LNG market prices fell sharply in February. As of February 28, the average price of LNG was 3,118 RMB/ton, a decrease of 13.63% from 3,610 RMB/ton on February 1. The LNG market was showing an overall situation of supply exceeding demand.

Market outlook                                            

In February, the prices of raw material hydrochloric acid and fuel liquefied natural gas declined, leading to a decrease in the cost of polyaluminum chloride (PAC). On the supply side, China had ample PAC inventory; on the demand side, downstream industries fully resumed operations in March, and demand gradually recovered. Supply increased with the rise in operating rates, resulting in a weak supply-demand balance. It is expected that the PAC market will mainly consolidate in the near term.

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