Introduction: During the holiday period, the domestic n-butanol market remained largely flat. Production plants maintained low-price operations, while overall downstream demand was limited, resulting in a sluggish trading atmosphere. However, with raw material prices remaining at elevated levels, high costs provided strong price support, leading to increased market wait-and-see sentiment.
As of October 7, the price in Shandong region was CNY 8,100/ton, representing a decrease of CNY 150/ton from September 30, a decline of 1.82%.
In the early stage of the National Day holiday, the overall trading atmosphere in the domestic n-butanol market cooled down. Some production plants lowered their ex-factory prices to facilitate sales, causing high-end market prices to disappear. Due to the holiday factors, downstream demand declined, leading to reduced inquiries and transactions. While plant shipments were limited, inventory levels gradually rose. However, propylene (the key raw material) prices remained high, providing strong cost support for n-butanol. Throughout the holiday, the domestic n-butanol market primarily consolidated at low prices. Supply remained relatively stable as maintenance units had not yet resumed operation, limiting overall supply. Prior to the holiday, production plants actively offered discounts to boost sales, keeping inventories at low levels and reducing sales pressure during the break. Combined with high-cost support, market prices remained flat throughout the holiday period.
Supply Side: As of October 7, the daily domestic n-butanol output was approximately 8,110 tons, unchanged from September 30. Units that shut down for maintenance prior to the holiday remained offline, including those at Jilin Petrochemical, Daqing Petrochemical, and Shaanxi Yanchang Petroleum. Due to pre-holiday discounting by production plants to clear inventory, stock levels continued to operate at low positions.
Demand Side: During the holiday, the operating rates of major downstream industries remained relatively stable. Downstream players conducted limited pre-holiday stocking and primarily consumed existing raw material inventories. Considering that some n-butanol maintenance units are scheduled to restart after the holiday, leading to an expected gradual increase in supply, market inquiries and purchasing intentions were low during the break. Consequently, transaction prices centered around the lower end of the range.
From a supply perspective, it is anticipated that some previously shut-down maintenance units will restart after the holiday, leading to a gradual increase in overall market supply. Additionally, inventories accumulated by production plants during the holiday will enter the market, ensuring ample overall supply. From a demand perspective, downstream industries are entering the traditional off-season, with operating loads expected to decline after the holiday, potentially weakening terminal procurement demand.
Overall, the post-holiday domestic n-butanol market is shifting toward oversupply. As supply increases slowly, downstream buyers are expected to maintain rigid demand, purchasing only at lower prices. The general trading atmosphere will remain subdued at the lower end of the price spectrum. However, given that propylene prices remain high, cost pressures will continue to provide support for n-butanol prices. Therefore, it is predicted that the domestic n-butanol market will experience fluctuating consolidation upon return from the holiday.
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