① Domestic phthalic anhydride (PA) industry inventories stayed low, and downstream players carried out concentrated restocking.
② The re-escalation of geopolitical conflict in the Middle East drove international crude oil prices up, leading to a rebound in commodity futures market prices.
Table 1 Monthly Price Overview for o-Xylene and Phthalic Anhydride (Unit: RMB/ton)
| Product | Region/Category | Current-Period Avg. | Previous-Period Avg. | Year-Ago Avg. | MoM Change | YoY Change |
|---|---|---|---|---|---|---|
| o-Xylene | Jiangsu | 8,579 | 8,060 | 6,438 | 6.44% | 33.26% |
| Phthalic Anhydride | Jiangsu (o-Xylene Route) | 9,179 | 8,393 | 6,174 | 9.36% | 48.67% |
| Hebei (Naphthalene Route) | 8,003 | 7,693 | 5,976 | 4.03% | 33.92% |
Data source: Chempricehub
In August, the domestic PA market price showed a "V"-shaped rebound, with cost and demand-side factors playing decisive roles. At the beginning of the month, persistently weak end-user demand kept the capacity utilization of the main downstream plasticizer industry low. Under negative feedback transmitted from the demand side, domestic PA prices came under pressure and moved downward. However, domestic PA industry capacity utilization also remained low, and downstream inventories were likewise lean. Supply of naphthalene-route PA remained tight. With the re-escalation of Middle East geopolitical tensions, crude oil lifted commodity futures markets, creating strong bullish speculation. Against this backdrop, domestic PA prices surged substantially given the low industry inventories. Toward the end of the month, however, expectations of a reopening of a key waterway/strait triggered a decline in crude oil and heightened market caution, leaving PA prices under pressure at elevated levels.
(Figure caption omitted per instruction.)
① Domestic PA industry inventory levels.
② o-Xylene maintenance/turnaround schedules.
③ Price spread between o-xylene-route and naphthalene-route PA.
The tight supply of feedstock o-xylene is likely to ease gradually. Domestic o-xylene-route PA capacity utilization is expected to pick up, and new o-xylene-route PA capacity is also expected to come into production, increasing supply-side pressure and potentially becoming the main factor restraining the market. With higher operating rates anticipated among o-xylene-route PA producers, supply of o-xylene-route PA will increase, while imports remain negligible, further weighing on the market. Meanwhile, naphthalene-route PA plants previously under maintenance are expected to resume operations, adding to naphthalene-route supply and easing the earlier supply tightness to some extent. On the demand side, demand is likely to recover, showing an incremental trend. As a result, the market supply–demand gap may widen. It is expected that the overall price center of domestic PA may move downward in September, while the price spread between o-xylene-route and naphthalene-route PA is likely to narrow.
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