SunSirs: Costs Fell, and Phthalic Anhydride Prices Fluctuated Downwards

Phthalic anhydride prices fluctuated and fell last week 

According to SunSirs’ Commodity Market Analysis System, as of August 8, the price of OX based phthalic anhydride was 6,550 RMB/ton, a 1.50% decrease from the price of 6,650 RMB/ton on August 1. The fluctuating decline in OX and industrial naphthalene prices in August increased downward pressure on phthalic anhydride prices. Phthalic anhydride equipment load decreased in August, leading to a slight drop in the operating rate of phthalic anhydride manufacturers. Phthalic anhydride supply was sufficient, and downstream plasticizer prices fluctuated downward. Plasticizer manufacturers increased their equipment operating load, providing increased support for phthalic anhydride demand. Reduced supply, rebounding demand, and lower costs led to a fluctuating decline in phthalic anhydride prices last week.

Phthalic anhydride costs fell and supply was sufficient

As of August 8, Sinopec's OX price was 6,600 RMB/ton, down 2.86% from 6,800 RMB/ton at the beginning of the month. Industrial naphthalene prices fluctuated and stabilized, while OX prices fell. Declining phthalic anhydride costs put increasing downward pressure on phthalic anhydride prices, leading to falling prices. Naphthalene-based phthalic anhydride prices ranged from 6,100 to 6,300 RMB/ton, while OX-based phthalic anhydride prices ranged from 6,300 to 6,400 RMB/ton. Phthalic anhydride equipment operating rates decreased in August, reaching 60% of capacity, reducing phthalic anhydride supply. This reduction in supply, coupled with recovering demand and lower costs, led to a volatile decline in phthalic anhydride prices last week.

Demand side: Downstream production declined, and DOP prices fluctuated and fell

Last week, DOP plants, previously shut down, mostly resumed normal operations, with DOP plant operations slightly increasing, with operating loads increasing by 3%. According to SunSirs’ Commodity Market Analysis System, as of August 8, the DOP price was 7,834.16 RMB/ton, a 1.53% decrease from the August 1 price of 7,955.83 RMB/ton. Last week's increase in DOP production, coupled with rising plasticizer production and recovering demand for phthalic anhydride, provided further support for the price increase.

Market outlook

Analysts of phthalic anhydride product data of SunSirs believe that on the demand side, plasticizer plant operating rates increased, leading to an increase in plasticizer output and a rebound in phthalic anhydride demand. On the supply side, phthalic anhydride plant equipment operating rates decreased, reducing phthalic anhydride supply. Regarding costs, falling phthalate prices also reduced phthalic anhydride costs. Looking ahead, with reduced phthalic anhydride supply and recovering demand, coupled with falling costs, phthalic anhydride prices are expected to fluctuate downward.

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