SunSirs: Demand in the Formic Acid Market Was Insufficient, and Prices Were Trending Downward

Price Trends

According to the commodity market analysis system of SunSirs, the domestic market for 85% industrial-grade formic acid has recently maintained a weak, fluctuating downward trend. As of June 22, the benchmark price for 85% industrial-grade formic acid stood at 2,080 RMB/ton, a decline of 5.45% compared to the previous week.

Market Fundamentals: Weakness on both the supply and demand sides; lack of bullish support.

Demand Side: Traditional off-season for consumption; follow-through on essential demand was sluggish.

The downstream market for formic acid has entered its traditional off-season; operating rates across key application sectors—such as leather, pharmaceuticals, pesticides, and rubber—remain generally low. With downstream factories holding high inventories of finished goods, purchasing is largely limited to small, essential orders, and there is minimal willingness to stock up in bulk. Although upstream shipments saw a slight month-on-month improvement following the price drop, this merely reflects sporadic restocking driven by low prices rather than a genuine recovery in end-user demand. Consequently, the market remains fundamentally weak, with sluggish demand continuing to constrain any upward movement in formic acid prices.

Supply side: High inventory levels combined with delayed maintenance resumptions kept market supply pressure high.

On one hand, overall inventories in the domestic formic acid industry remain at the upper end of the medium range; stocks accumulated steadily during the earlier period of normal plant operations, and the pace of inventory destocking by manufacturers has been sluggish. With ample spot supply available, upstream producers lack the leverage to push for higher prices. On the other hand, plans for plant maintenance resumptions—previously anticipated by the industry—are highly likely to be delayed. Consequently, expectations for a contraction in market supply have failed to materialize, further intensifying the pressure of spot supply within the market.

Market Outlook:

Data from the SunSirs spot market platform indicates that, given current supply-demand fundamentals and industry conditions, the domestic formic acid market is unlikely to shake off its weak trend in the short term; the recent period of sideways movement represents merely a brief pause, and prices are expected to decline further. Future market trends will depend largely on the extent of concentrated restocking by downstream sectors and the actual progress of maintenance work at domestic formic acid production facilities.

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