What are the key demand drivers and price outlook for 1-butanol in 2026?

Entering 2026, China's 1-butanol market shows a cyclical upturn. Prices rose 24.7% from Q4 2025 lows to March 2026, supported by propylene costs climbing above 9,000 yuan/ton and robust downstream demand. Major producers like Luxi Chemical reported Q1 2026 net profit up 475.9% quarter-on-quarter, with butanol prices rising 23.4% sequentially. Supply-side discipline is evident—no major new capacity additions are expected in 2026 for key derivatives like caprolactam-nylon 6, while downstream sectors including coatings, plastics, and chemical intermediates are recovering. This supply-demand tightening, combined with cost-push from propylene, suggests sustained price strength through 2026.