Last week, the price of the plasticizer DOP halted its upward trend and declined
According to the SunSirs Commodity Market Analysis System, as of April 10, the price of DOP stood at 10,275.83 RMB/ton. This represents a net increase of 0.16% compared to the price of 10,259.17 RMB/ton recorded on April 1—a period characterized by an initial rise followed by a decline—and a decrease of 0.96% compared to the price of 10,375.83 RMB/ton recorded on April 8. Driven by geopolitical crises in the Middle East, crude oil prices surged; this impact rapidly cascaded down the industrial chain to downstream sectors, triggering substantial price hikes for isooctanol and phthalic anhydride. Consequently, the production costs for DOP rose, leading to a significant increase in the market price of the plasticizer DOP. Subsequently, following a two-week ceasefire agreement between the U.S. and Iran, crude oil prices retreated. Downstream product prices responded immediately to this shift, with prices for octanol and phthalic anhydride falling; this resulted in reduced production costs for DOP and a subsequent decline in DOP market prices.
Crude oil market trended ripple through to the downstream sector
As the deadline set by the Trump administration expired on April 8, the United States and Iran announced a two-week ceasefire agreement, brokered by Pakistan. Under the terms of the agreement, the ceasefire took effect immediately, and Iran agreed to temporarily reopen the Strait of Hormuz to ensure the safety of global shipping. Delegations from both the U.S. and Iran are scheduled to hold negotiations in Islamabad, the capital of Pakistan, on April 10. This news triggered violent fluctuations in global commodity markets, causing crude oil prices to halt their upward trend and plummet. However, due to damage to energy infrastructure in the Middle East and the slow pace of supply chain recovery, oil prices are unlikely to revert to their pre-conflict lows. As crude oil serves as the primary feedstock for the chemical industry chain, the decline in oil prices has rippled downstream, leading to price drops for isooctanol and phthalic anhydride.
The price of the raw material isooctanol had Shalted its rise and begun to decline
According to the SunSirs Commodity Market Analysis System, as of April 10, the quoted price for isooctanol stood at 9,200 RMB/ton. Compared to the price of 9,266.67 RMB/ton on April 1, the market experienced an initial rise followed by a decline, resulting in a decrease of 0.72%; compared to the price of 9,533.33 RMB/ton on April 7, the price fell by 3.50%. Following the ceasefire agreement reached between the U.S. and Iran, crude oil prices declined. This trend subsequently filtered down to the downstream sector, leading to a drop in propylene prices; consequently, the reduction in production costs drove down the price of isooctanol.
Phthalic Anhydride Market Reversed Course, Declining After Rally
According to the SunSirs Commodity Market Analysis System, as of April 10, the quoted price for o-xylene-based phthalic anhydride stood at 9,333.33 RMB/ton. This represents a fluctuating decline of 0.89% compared to the price of 9,416.67 RMB/ton recorded on April 1. The sharp plunge in crude oil prices—triggered by the ceasefire between the U.S. and Iran—has rippled down to downstream sectors, intensifying the downward pressure on phthalic anhydride prices. However, numerous upstream o-xylene producers have currently suspended operations for maintenance; specifically, Yangzi Petrochemica’s o-xylene facility underwent maintenance in April, while Jinling Petrochemical has scheduled maintenance for its o-xylene facility in May. This has resulted in a severe reduction in o-xylene supply, leaving little room for further price declines in the feedstock market. Consequently, cost-side support for phthalic anhydride remains intact, mitigating the downward pressure on its prices and continuing to provide cost support for the downstream plasticizer sector.
Market outlook
According to the plasticizer product data analyst at SunSirs, regarding cost factors: the downward trend in crude oil prices has filtered through to the market, leading to a decline in isooctanol prices and, consequently, a reduction in the production costs for the plasticizer DOP. Looking ahead, however, crude oil prices are unlikely to revert to the lows seen prior to the recent conflict; as this trend propagates downstream, the potential for further declines in isooctanol prices is limited. Furthermore, the price of phthalic anhydride—another key raw material—continues to find support from upward market pressures. Consequently, the scope for further reductions in the raw material costs for DOP is restricted, placing minimal downward pressure on DOP prices themselves. The market is therefore expected to see DOP prices undergo a period of weak consolidation in the near term.
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