SunSirs: Amid the Tug-of-War Between Supply and Demand, the Acrylic Acid Market Was Fluctuating and Consolidating

The acrylic acid market experienced a continuous downward trend last week; as of July 6, the benchmark price tracked by SunSirs stood at 7,116.67 RMB/ton, marking a cumulative drop of 7.38% for the month compared to the 7,683.33 RMB/ton recorded at the beginning of July.

In contrast, the price trend of its key feedstock, propylene, has moved in the opposite direction; the benchmark price for propylene stood at 7,694.33 RMB/ton, marking a 3.82% increase since the beginning of the month. This creates a clear divergence between rising raw material costs and falling product prices, with the interplay of supply and demand driving current market trends.

Divergence between costs and supply-demand: Rising prices for the raw material propylene support costs, while weak downstream demand suppresses market performance.

Cost-side factors are providing counter-support: Last week, the price of propylene feedstock rose against the trend by 3.82%, increasing cost pressures on acrylic acid producers. Manufacturers have shown a stronger inclination to hold firm on prices, thereby limiting the scope for further declines in acrylic acid prices.

Supply-demand fundamentals remain weak: On the supply side, operating rates at production facilities have remained stable, and market supplies are plentiful, exerting downward pressure on prices. Downstream enterprises are cautious in their purchasing, limiting orders to small volumes for immediate needs and showing little willingness to build up large inventories; sluggish demand is failing to drive a price rebound. The interplay between cost support and weak demand constitutes the central dynamic of the current market.

Market Outlook:

In the short term, the acrylic market is unlikely to break out of its pattern of low-level fluctuation. Two key factors—cost support derived from the feedstock propylene and product prices currently at historical lows—will prevent any further sharp decline in prices.

Market attention going forward will focus on two key factors: first, whether essential downstream procurement will see a periodic surge in volume to alleviate the current sluggish demand; and second, whether the price of propylene feedstock will continue to rise, thereby strengthening cost support. If there is no significant improvement in demand, acrylic acid prices are likely to remain range-bound at low levels, hovering around 7,100 RMB/ton.

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