Price trend: Stabilized after a period of sideways fluctuation, with the overall price level shifting downward.

According to data from SunSirs, the benchmark price of melamine recently (July 9–15) exhibited a trend of "initial slight fluctuation followed by stabilization." As of July 16, the benchmark price stood at 6,012.50 RMB/ton, representing a 0.62% decrease compared to the beginning of the month (6,050.00 RMB/ton).

Cost-side support had weakened, and raw materials continued to weigh on the market.

Urea, the key raw material for melamine, has also weakened; recently, the SunSirs benchmark price for urea stood at 1,770 RMB/ton—a 2.41% drop from the 1,813.75 RMB/ton recorded at the beginning of the month—indicating a continued easing of cost support from the raw material side:

1. Urea is currently in the off-season for agricultural demand; with factory inventories accumulating and shipments facing pressure, urea prices have trended downward, directly lowering the cost floor for melamine.

2. The decline in raw material prices has undermined the industry's confidence in maintaining price levels. Upstream melamine producers struggle to leverage costs to drive price hikes, and even with prices at lows, there are no cost-side bullish factors to trigger a rebound.

Analysis of Supply and Demand Fundamentals

Supply Side

Industry operating rates remain stable, and manufacturers show no significant signs of inventory drawdown, resulting in ample spot market supply. A decline in the cost of the raw material—urea—has slightly reduced production costs for some facilities; however, enterprises have not engaged in concerted maintenance, production cuts, or voluntary volume control to support prices, and the abundant supply is limiting the potential for price increases.

Demand Side

Downstream sectors for panels and adhesives have entered the traditional off-season characterized by high temperatures; orders for home renovation and building materials remain sluggish. Downstream factories are purchasing strictly on an as-needed basis, with no signs of concentrated restocking. Traders are largely adopting a wait-and-see approach and show little interest in stockpiling at low prices; transaction volumes remain limited to meeting immediate, small-scale needs, and there are no positive drivers for demand growth.

Market Outlook:

Recently, the melamine market has remained generally stable but with a bearish undertone; following a slight price pullback, the market has settled into a period of low-level consolidation. With weakening urea feedstock prices and sluggish demand during the off-season, market sentiment is decidedly bearish. Current market activity relies solely on essential demand, and the lack of bullish drivers suggests the weak trend will persist in the short term; close monitoring of urea price trends and the recovery of operating rates in the downstream panel industry is required.

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