SunSirs: Raw Material Costs Remained High, and Melamine Prices Slightly Increased

Price trend

Recently, the melamine market has shown a slight upward trend. As of January 27th, SunSirs' benchmark price for melamine was 5,637.50 RMB/ton, an increase of 0.44% compared to last week (5,625.50 RMB/ton).

Prices have risen slightly recently, mainly supported by the following factors:

Cost rigidity provided support: The price of urea, the main raw material, remained high in January, significantly squeezing the profit margins of manufacturers and strengthening their willingness to maintain prices. As of January 28th, the SunSirs' benchmark price for urea was 1,747.50 RMB/ton, an increase of 1.30% compared to the beginning of the month (1,725.00 RMB/ton).

Supply tightening: In January, many domestic production companies scheduled plant shutdowns for maintenance or reduced operating rates, leading to a decrease in overall industry operating rates and a tightening of market spot supply.

Demand-driven procurement and export supported: Domestic downstream industries such as panel manufacturing and coatings generally adopted a demand-based procurement strategy. At the same time, export demand remains at a healthy level, acting as a "stabilizer" for the domestic market.

Short-term market outlook

Currently, the market is influenced by a mix of bullish and bearish factors, and prices are expected to remain volatile at high levels before the Spring Festival. High production costs and relatively tight supply provide fundamental support for market prices. Whether downstream industries will begin concentrated stockpiling before the Spring Festival is crucial in disrupting the current market balance and driving price increases. If plants that were shut down for maintenance during the holiday resume production quickly and in large numbers after the festival, it could increase supply pressure.

In summary, the melamine market has recently experienced a slight price increase, primarily driven by cost pressures and tightening supply. Whether prices will rise further depends on closely monitoring downstream inventory levels before the Chinese New Year.

If you have any inquiries or purchasing needs, please feel free to contact SunSirs with support@sunsirs.com.