Raw material-driven cost declines pull DBP market prices into a weak, gradual downward adjustment.

Overview: Raw material prices have peaked and turned lower, weakening cost support for DBP. Combined with persistently sluggish off-season downstream demand showing no signs of improvement, overall market trading remained subdued, and transaction prices drifted downward in a fluctuating pattern. However, DBP operating rates stayed at moderate levels with limited spot supply, so price declines were gradual.

1. DBP Market Prices Retreat from Highs

As feedstock prices continued to climb—particularly phthalic anhydride—DBP cost pressures intensified, keeping market prices elevated. However, toward the end of the month, geopolitical instability triggered frequent swings in international crude oil prices, which nevertheless trended downward overall. This weighed on both DBP feedstocks, n-butanol and phthalic anhydride. In addition, with downstream industries still in the off-season, operating rates and DBP demand remained constrained. Market inquiry and transaction sentiment weakened, with transactions gravitating toward the lower end of the price range. As a wait-and-see mood intensified among market participants, the market price center began to drift downward.

Table 1 Domestic DBP Industrial Chain Price Summary (Unit: CNY/ton)

Source: Chempricehub Information

2. Dual Feedstocks Drive Costs Down from Highs; DBP Price Center Shifts Lower

The most influential factor on DBP prices this time was the feedstock phthalic anhydride market. Affected by Middle East geopolitical tensions, international crude oil prices plunged, and overall market sentiment turned bearish. The o-xylene-based phthalic anhydride sector held low inventories, and with relatively low capacity utilization, this pushed the market center higher. However, follow-through buying at high prices weakened. Meanwhile, high-priced naphthalene-based phthalic anhydride encountered sales resistance, and domestic naphthalene-based PA prices surged before retreating into a slow, steady decline. n-Butanol also began to retreat from highs, but the overall decline was limited, mainly because planned maintenance at some units constraining spot supply lent support to n-butanol prices.

Table 2 DBP Cost-Profit Comparison (Unit: CNY/ton)

Source: Chempricehub Information

3. DBP Operating Rates Languish at Low Levels

Terminal downstream industries remained in the off-season, with subdued DBP demand centered on low-level rigid procurement. Combined with rising feedstock prices and mounting high-cost pressure, DBP margins at one point slipped into losses, prompting producers to cut operating rates or increase maintenance shutdowns. However, some units that had previously been under maintenance gradually resumed operations. As of July 31, domestic daily DBP output had fallen to around 1,290 tons/day, with the daily operating rate at approximately 47.56%. Although output ticked up slightly, the increase was marginal.

4. Market Outlook

Cost side: For n-butanol, the feedstock, intensifying high-cost pressure and imminent planned maintenance shutdowns will provide support to its market price. Costs for o-xylene-based phthalic anhydride are expected to remain stable, but cost-side support from that segment remains strong. Weekly average prices of industrial naphthalene are expected to decline, pointing to a modest weakening in costs for the naphthalene-based phthalic anhydride industry.

Supply-demand side: The terminal market is performing lackluster overall and remains in the off-season phase, so demand is expected to stay centered on rigid procurement, offering insufficient support.

With naphthalene-based phthalic anhydride slowly declining from highs—though high costs continue to support prices—and downstream end-users mainly purchasing on dips for essential needs, DBP operating rates are expected to remain stable at moderate levels. The domestic DBP market is likely to consolidate in a fluctuating range going forward.