SunSirs: Domestic Acetic Acid Prices Trended Downward in July

Price trend

According to the commodity market analysis system of SunSirs, the price of acetic acid fell first and then rose in July. As of July 30, the price was 2,400 RMB/ton, a decrease of 90 RMB/ton compared with the price of 2,490 RMB/ton at the beginning of the month, a decrease of 3.61%.

Analysis review

Acetic acid prices were primarily weak in July. In mid-early July, acetic acid production capacity utilization remained high on the supply side, leading to a continuous accumulation of market inventories and considerable pressure on companies to ship goods. On the demand side, downstream markets were weak, with the focus on depleting inventory and limited demand for acetic acid. This created a significant supply-demand imbalance and led to a continuous decline in acetic acid prices. In late July, policy news boosted sales, leading to increased shipments, but downstream demand was limited, and inventory pressure persisted, hindering the upward trend in acetic acid prices. This supply-demand dynamic led to an overall downward trend in acetic acid prices throughout the month.

The methanol market, a raw material, was experiencing weak and volatile conditions. As of July 30th, the domestic market average price was 2,416.67 RMB/ton, a 4.48% decrease from 2,530.00 RMB/ton at the beginning of the month. Methanol prices continued to decline in the first half of the month, constrained by weak end-user demand, accumulated methanol inventories at ports, and cautious purchasing by downstream methanol suppliers in mainland China to meet demand. This lack of upward momentum in the methanol market led to a rebound in the second half of the month, buoyed by macroeconomic policies. However, weak demand from traditional downstream suppliers weighed on the market, pushing methanol spot prices downward again.

Future outlook:

Analysts of SunSirs believe that the acetic acid market was experiencing a partial decline, with supply pressure remaining. Downstream demand was generally supportive, and companies were shipping only limited units, leading to weak short-term prices. Some companies on the supply side are planning maintenance in August. Due to the supply-demand dynamics, acetic acid prices are expected to fluctuate and consolidate in the future, with specific attention being paid to downstream market developments.

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