China's Phenol Market in September Rises First Then Falls

September 29, News

In September, the Chinese phenol market first rose and then fell. According to the monitored data, from the perspective of the East China market, on September 1st, the price of phenol in China was 6800 CNY/ton, and by September 29th, the price of phenol in China had changed to 6846 CNY/ton. Major mainstream markets across the country experienced fluctuations of similar magnitude.

In the first ten days of the month, the market experienced a rapid upward trend. During the first ten days, the East China region mainly replenished domestic trade with ship cargo, and in operations, there was a significant delay, leading to a clear shortage in port inventory. By the 15th, the port inventory in Jiangyin was only 0.50,000 tons, remaining at a low level for the previous week. In the first ten days, the phenol market quickly rose, breaking through 7,000 CNY per ton.

In the middle to late part of the month, after a rapid rise, considering the terminal's acceptance of high prices and the negative impact on costs, the market experienced a rational correction. Although the supply side was still relatively tight at that time, the high prices could no longer be supported, and with the higher average monthly price in the late part of the month, the market showed a downward trend, and Sinopec also promptly adjusted its listed prices.

As of September 29, the benzene phenol quotation situation in major markets across China is as follows:

In terms of facilities: During the month, Shenghong Refining, Jiangsu Ruiheng, Longjiang Chemical, and Sinopec Mitsui phenol and ketone facilities all had shutdowns for maintenance of varying durations. As a result, China's phenol and ketone facility utilization rate dropped to a low point of 66%. Shandong Fuyu Chemical plans to start a 30-day maintenance on September 28, and Ningbo Formosa plans to begin a maintenance period of around 40 days starting mid-October.

It is expected that before the National Day, more attention will be paid to the inventory preparation of downstream customers. Currently, the inventory pressure at Jiangyin Port is not significant. As the shutdown facilities gradually restart, the inventory preparation of downstream customers before the holiday will also be influenced by the industry's operating rate, mostly preparing according to demand. After the holiday, it may also mainly follow the demand. Overall, while the phenol market supply side has some support in the short term, the market pressure is greater in the later period, and the market trend will mainly be weak operation.