C5 petroleum resin market sales declined slightly, while prices remained firm due to cost support

Introduction: Feedstock C5 and isoprene prices continued to rise. Downstream adhesive manufacturers maintained rigid demand for C5 petroleum resin, while hot-melt coating demand continued to weaken. However, due to cost pressures, sporadic price increases persisted.

1. Cracked C5 and Isoprene Prices Rose

Cracked C5 prices in North China rose by RMB 100/ton to RMB 7,600/ton; East China rose by RMB 200/ton to RMB 7,600/ton. Northeast prices ranged from RMB 7,250–7,650/ton, and South China prices were quoted at RMB 7,450–7,600/ton. Some private enterprises raised prices to RMB 7,350–8,003/ton. Domestic isoprene prices remained stable within a range, with minor localized increases; ex-factory quotes ranged from RMB 9,200–10,900/ton.

2. Weekly Supply of C5 Petroleum Resin Remained Low

Table 1: Status of C5 Petroleum Resin Units

Data Source: Chempricehub Information

This week, the production volume of industrial cracked C5 decreased by 0.2% compared to last week, reaching 73,100 tons. Last week's production dropped by 400 tons, with a capacity utilization rate of 71.85%. Meanwhile, the weekly supply of C5 petroleum resin was 8,000 tons, with an operating rate of 61.71%. The operating rate has continued to decline recently, falling below the year-to-date average. Raw material cracked C5 prices rose to RMB 7,500–7,600/ton, while the national average price for cracked C5 residual liquid remained around RMB 7,100/ton. The price inversion persists. Furthermore, the sharp drop in international oil prices during the week led to significant reductions in the production, sales, and inventory of cracked C5 residual liquid. Consequently, resin manufacturers face substantial cost pressure, and some units have not yet restarted, keeping production volumes low.

From an inventory perspective, overall supply remains low. Production of road marking paint resin has fallen to its lowest level in recent years, with downstream buyers maintaining only rigid demand procurement, resulting in a basic balance between production and sales. Regarding adhesive resin, rigid demand persists. Additionally, October saw concentrated exports, making it difficult to accumulate inventory. Inventory levels fluctuated slightly around current levels, mostly remaining below safe stock thresholds and near their lowest points in the past two years.

Table 2: C5 Petroleum Resin Production-Sales Balance Sheet

Data Source: Chempricehub Information

In terms of consumption, demand for hot-melt coatings declined slightly, and downstream factory inventories fell to low levels, with rigid demand maintained at 2,750 tons. For label adhesives, rigid demand remained robust. Given the uncertain international situation, some overseas orders were placed ahead of schedule, keeping downstream consumption at 5,170 tons. Overall, downstream demand decreased slightly, with phased declines in both hot-melt coatings and label adhesives.

Looking ahead, domestic cracked C5 prices are expected to dip slightly next week. Isoprene supply remains tight, supporting its prices. Manufacturers continue to face high cost pressures. The gradual restart of some units may lead to increased supply. Downstream inventories are low, suggesting that buyers will soon enter a new restocking cycle. However, volatility and downward trends in international oil prices are exacerbating end-user caution, potentially leading to insufficient market purchasing activity. Market transactions may remain stagnant. Combined with expectations of a pullback in feedstock C5 prices, this could put pressure on local C5 petroleum resin prices.