On April 1, the Business Society’s benchmark price for acetic acid stood at RMB4,140.00 per ton, representing a 48.03% increase compared to early March (RMB 2,796.67 per ton). This surge was primarily driven by the combined impact of four key factors: soaring raw material costs, tightening supply, low inventory levels, and strong downstream demand.

I. Raw Materials (Methanol): Soaring Costs Provide Strong Support

The mainstream process for acetic acid production is methanol carbonylation (accounting for over 90% of production), with methanol costs comprising approximately 65%–70% of total costs. Methanol prices directly determine the cost floor for acetic acid.

1. Methanol Prices Surge

On April 1, the SunSirs acetic acid benchmark price stood at 4,140.00 RMB /ton, a 48.03% increase compared to early March (2,796.67 RMB /ton).

Key Drivers: Geopolitical Tensions in the Middle East (Iran + Saudi Arabia)

Iran (the world’s largest methanol exporter) has a plant shutdown rate exceeding 80%

Force majeure shutdown at Saudi Arabia’s Jubail (the world’s largest single methanol production base)

China’s March imports plummeted, with port inventories declining continuously (East China inventories fell by 84,700 metric tons in a single week)

Cost Pass-Through: A rise in methanol prices per ton → Theoretical acetic acid costs increase, providing strong cost support for price hikes.

II. Supply and Inventory: Tight Spot Market, Low Inventories, Strong Will to Maintain Prices

1. Supply Side: High Operating Rates, but Unexpected Maintenance/Shutdowns Exacerbate Tightness

Industry Operating Rate: 85%–88% (High)

Key Disruptions:

Jiangsu Suopu unexpected shutdown

Sinopec Great Wall temporary maintenance for 3 days

Central China plant auction price rose from 4,100 to 4,440 RMB /ton (significant premium)

April Maintenance Forecast: Jingmen Qianxin (25-day maintenance starting April 15), Zhejiang Petrochemical (maintenance in mid-April) → Further supply contraction.

2. Inventory: Continued Drawdown, Operating at Low Levels

Enterprise Inventory: Down to historic lows (main plant inventories <140,000 tons)

Market Conditions: Tight spot supply, no excess inventory, manufacturers reluctant to sell, and firm price support

Logic: With low inventories, there is no incentive to lower prices; even slight fluctuations in demand trigger rapid price increases.

III. Downstream Sector: Strong Essential Demand, Smooth Price Transmission, and Active Restocking

The primary downstream products of acetic acid include PTA, vinyl acetate monomer (VAM), ethyl acetate, and acetic anhydride. Essential demand remains robust, and exports have exceeded expectations, so the market continues to absorb high prices.

1. PTA (Accounts for ~40%, Anchor)

PTA capacity continues to expand (5 million metric tons added by 2026), with stable essential demand.

Acetic acid accounts for an extremely low proportion of PTA costs (0.04 metric tons per metric ton of PTA), allowing price increases to be fully passed on without resistance.

PTA operating rates remain high, ensuring stable consumption of acetic acid.

2. Vinyl Acetate Monomer (VAM, ~18%–20% share, growth engine)

Benefiting from strong demand for solar EVA films and VAE emulsions

Export arbitrage opportunities have opened up; domestic supply is tight, and sellers are reluctant to sell at low prices

This drives up acetic acid procurement, leading to coordinated price increases across the supply chain.

3. Ethyl Acetate and Acetic Anhydride (~12%–15% share)

Driven by cost pressures and strong domestic demand, prices have surged significantly.

With low industry inventories and favorable export conditions, restocking by end-users is active.

Procurement of acetic acid remains stable, and the market has strong capacity to absorb high prices.

4. Export Demand (Additional Growth)

Numerous plant maintenance shutdowns in the Asia-Pacific region have led to tight global supply.

China’s March exports exceeded 130,000–140,000 metric tons, significantly diverting domestic supply.

Imports by end-users in India and other markets are supporting high prices.

By late March, as market prices rose, transactions became scarce and few offers were made, with the market adopting a cautious wait-and-see stance; April export volumes are projected to increase significantly compared to March. However, demand expectations remain high. While there have been reports of partial production cuts and single-line shutdowns in the PTA sector, most plants are operating normally. Operating rates for vinyl acetate and ethyl acetate are expected to remain high in April and may even increase further, resulting in robust demand. Therefore, even if raw material prices decline in late April and during the second quarter, glacial acetic acid prices are expected to remain at elevated levels due to supply-demand fundamentals, with no significant short-term correction anticipated.

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