BDO Market Remains Stable Amidst Caution

September 19, News

According to the commodity market analysis system, from September 12 to 19, the average price of BDO in China remained at 7,542 CNY/ton, a 2.22% decrease week-over-week and a 0.75% decrease year-over-year. The BDO market in China operated steadily with some plants undergoing maintenance or reducing production, leading to a decrease in supply. The industry is experiencing losses, and suppliers are considering tightening policies in October to support the market. Downstream buyers are maintaining contract follow-ups, but spot purchases are limited due to cost pressures. The market remains balanced with negotiations between supply and demand.

Supply Side: In terms of facilities, the first phase of Wuheng Chemical has been shut down for maintenance, while Heima and Hengli's facilities are operating at reduced capacity. This has led to a decrease in the overall capacity utilization rate of the industry, resulting in a reduction in the supply of goods. At the same time, due to long-term losses in the industry, suppliers' intentions to support the market have increased. Some factories plan to tighten their sales policies in October, while others are currently taking a wait-and-see approach. The BDO supply side is expected to see positive factors influencing it.

Statistics on the operational status of equipment at selected manufacturing facilities:

Cost Perspective:
Regarding raw material calcium carbide, China's calcium carbide market continues its upward trend, with production companies maintaining a steady pace of shipments. Overall, supply remains tight across the market. As for raw material methanol, prices in China continue to remain weak. As of 10:00 AM on September 19, the reference price for methanol at Taicang, China, stood at 2,270 CNY per ton. While calcium carbide prices have edged higher, methanol prices remain sluggish and are consolidating. Consequently, the cost impact on BDO is mixed—showing both positive and negative influences.

Demand Side: Downstream PTMEG operating rates saw a slight decline, while capacity utilization rates in industries like PBAT increased—yet this did not lead to any significant change in raw material consumption. As the settlement period approaches, downstream sectors are either following up on contract orders or working through existing inventories, resulting in only moderate purchasing activity in the market. Meanwhile, cost pressures continue to weigh on spot market dynamics, keeping buyer interest subdued. Overall, BDO demand remains under downward pressure due to these bearish factors.

Market Forecast: Some facilities that have been operating at reduced capacity will increase their load, leading to a slight rise in BDO supply. The industry's loss-making situation is expected to continue, and suppliers plan to tighten sales policies to support the market. Downstream users will maintain contract follow-ups or digest inventories. BDO analysts predict that with both supply and demand increasing, the Chinese BDO market will remain in a stalemate.