Supply-Demand Tug-of-War Intensifies, Acrylic Market Remains Strong

September 09, News

This week, the acrylic acid market in China has been struggling to balance between "weak demand" and "high costs." Although overall demand is weak, producers are strongly willing to maintain prices near the cost line. Additionally, supply tightening in some regions has pushed market prices slightly higher.

Market Price: On September 9, the benchmark price of acrylic acid in China was 6,316.67 CNY/ton, an increase of 1.07% compared to the beginning of this month (6,250.00 CNY/ton).

Industry Capacity Utilization Rate: On September 8, the average capacity utilization rate in China's acrylic acid industry stood at 72.84%, unchanged from the previous business day. This indicates that supply remains stable, with no significant increase in output.

Production Profit: The industry's profit margin continues to be squeezed. As of August 28, data shows that the production profit margin for the acrylic acid industry in China is 5.43%, a decrease of 2.26 percentage points from 7.69% in the previous week (August 21). Some factories are already near or below the break-even point.

Supply side:

The industry operating rate is maintained at a median level of 72.84%, with factories prioritizing stability, and the overall supply remains stable.

Social inventory is at a moderately high level, and inventory pressure continues to exist. However, factories and cargo holders in China have a strong sentiment for maintaining prices, and they are flexible in their offers, adjusting according to the market.

Notably, in the second half of 2025, China's acrylic acid industry still has plans to commission more than 600,000 tons—or even up to 740,000 tons—of new production capacity (e.g., facilities like Shandong Lanwan and Tianjin Bohua), which could once again intensify supply pressures in the industry.

On the demand side:

The main downstream sectors in China (such as coatings, adhesives, and textile auxiliaries) show insufficient purchasing enthusiasm, generally holding a bearish or cautious attitude. They mainly focus on replenishing inventory based on rigid demand, and price-cutting behavior is widespread.

The export market is equally unpromising. In the first half of 2025, China's butyl acrylate export volume decreased by 13.42% year-on-year, failing to effectively alleviate the supply pressure in China.

Traditional demand sectors (such as oil extraction, water treatment, papermaking, etc.) are being dragged down by the weak global economy, making it difficult to see significant growth in China.

Cost Support:

Recently, the price of propylene, a key raw material, has experienced some volatility. As of September 9, the benchmark price for propylene stood at 6,605.75 CNY per ton, representing a 0.86% decrease compared to the beginning of this month (6,663.25 CNY/ton). Although cost-side support has become slightly weaker than earlier levels, producers have very limited room to offer discounts—given that profit margins for acrylic acid production are already quite low (5.43%), with some plants even operating near their break-even points. This leaves manufacturers with a strong willingness to maintain prices, providing significant support to market dynamics.

Future Outlook

In the short term (within September), the acrylic acid market in China is expected to continue its fluctuating but relatively strong trend, although both upward and downward movements are limited. The main theme of the market remains the tug-of-war between cost support and weak demand. If there is no significant improvement in downstream demand (such as large-scale concentrated purchasing by major downstream players or a substantial increase in export orders), prices will struggle to sustain a significant rise. It is expected that the market may see a slight upward trend.

In the medium to long term, the acrylic acid industry in China is undergoing a transition from "scale competition" to an "era of technology premium." Leading companies are building barriers through technological iteration and industrial chain integration (such as Satellite Chemical, Huayi Group), while small and medium-sized enterprises, due to insufficient investment in technology, struggle to meet high-end demands (such as medical-grade and electronic-grade acrylic acid), thus facing increased survival pressure.

Overall, the acrylic acid market in China remained firm this week amid supply and demand dynamics, with prices edging up slightly. Cost support and producers' price-holding sentiment are the main supports for the current market, but weak demand and high inventories have also constrained the upside potential of prices.