SunSirs: Driven by Rising Costs, the MDI Market Remained Stable Initially and Then Trended Upward

Price trends:

According to the commodity market analysis system of SunSirs, the domestic MDI market saw a significant rise between September 7 and 11. The average price stood at 17,366 RMB/ton at the start of the week and reached 18,066 RMB/ton by September 11, marking a weekly increase of 4.03% and a year-on-year rise of 20.44%. Early in the week, market inquiries were relatively sluggish and demand remained tepid, with middlemen maintaining steady shipments. Subsequently, driven by a sharp surge in crude oil prices and strengthened cost support, major MDI manufacturers raised their quotes; traders followed suit, and market activity was dominated by small-volume transactions.

Market analysis

Supply side: Japan's Tosoh plans to shut down its 200,000-ton/year MDI unit for maintenance in early September, with the process expected to last approximately 45 days. Wanhua's Yantai Industrial Park 1.1-million-ton/year MDI unit is scheduled to halt production for maintenance starting August 10, 2026, with the work expected to take around 45 days.

Cost side: Benzene prices saw a significant rise last week. Geopolitical risks continued to drive up crude oil prices, while port inventories of benzene declined and expected future arrivals remained low; additionally, with the approach of the Mid-Autumn Festival and National Day holidays fueling expectations of increased demand, the basis spread and trading price levels for benzene continued to climb.

Demand side: Downstream inquiries have been moderate; while inquiries for small orders increased following the price rise, actual transaction volume remained low, indicating insufficient support from the demand side.

Market Outlook:

Currently, the MDI market is seeing high prices underpinned by costs, yet demand-side support remains weak; amidst the tug-of-war between bullish and bearish factors, the market is expected to fluctuate in the short term in line with raw material price movements, necessitating close monitoring of supply-demand dynamics and market news.

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