Cost Decline, Weak Demand: October Phthalic Anhydride Prices Continue to Fall

October 31st, according to reports

October Phthalic Anhydride Prices in China Experienced Fluctuations and Decline

According to the commodity market analysis system, as of October 31, the price of o-xylene phthalic anhydride in China was 5950 CNY/ton, a fluctuating decline from the price of 6293.33 CNY/ton on October 1, marking the lowest price for phthalic anhydride since March 2021. The price of phthalic anhydride has fallen for seven consecutive months, with a significant drop of 5.46% in October, representing the largest monthly price decrease of the year in China.

In October, the price of raw material orthoxylene fell, and the price of industrial naphthalene weakened and declined, leading to a decrease in the cost of phthalic anhydride. The operating load of phthalic anhydride equipment in China slightly increased, and the operating rate of phthalic anhydride enterprises improved, resulting in a sufficient supply of phthalic anhydride. The market for downstream plasticizers fluctuated and declined, and the operating load of plasticizer production equipment in China decreased, weakening the demand support for phthalic anhydride. With the decrease in costs and weak demand, the price of phthalic anhydride in October fluctuated and declined.

October Phthalic Anhydride Costs Decreased in China

On October 31, Sinopec's ortho-xylene quote was 6,300 CNY/ton, a decrease of 100 CNY/ton from the price of 6,400 CNY/ton on October 1, with a price decrease of 1.56%. The industrial naphthalene price fluctuated and fell, the ortho-xylene price dropped, and the cost of phthalic anhydride decreased. The operating load of phthalic anhydride equipment slightly increased, and the overall operating rate of phthalic anhydride enterprises rose, ensuring ample supply of phthalic anhydride.

Demand Side: Downstream Plant Starts Decline, Driving DOP Prices to Fluctuate and Fall

According to the commodity market analysis system, as of October 31, the DOP price was 7009.16 CNY/ton, a volatile decrease from the DOP price of 7367.50 CNY/ton on October 1, with a price decrease of 4.86%. In October, the DOP price showed a volatile downward trend, with DOP production enterprises operating at less than 60% capacity, and the operating rate declined. The demand for phthalic anhydride was weak, increasing the pressure for phthalic anhydride prices to fall.

Future Market Prediction

Phthalic anhydride product data analysts believe that, in terms of demand, the operating load of plasticizer enterprises' DOP equipment has dropped to less than 60%, leading to a decrease in plasticizer production and a decline in the support for phthalic anhydride demand; in terms of supply, the operating rate of phthalic anhydride enterprises has slightly increased, resulting in ample supply of phthalic anhydride, with insufficient support for price increases. In terms of costs, the price of ortho-xylene has fallen, and the price of industrial naphthalene has also weakened, leading to a decrease in the cost of phthalic anhydride. Overall, in October, the cost of phthalic anhydride in China decreased, with weak demand and ample supply, leading to a fluctuating and declining trend in the price of phthalic anhydride.

In late October, the operating rate of DOP enterprises in China slightly increased, leading to an increase in DOP production. The demand for phthalic anhydride (PA) slightly improved, and the operating rate of PA enterprises also increased, with an expected rise in PA production and sufficient supply. Looking ahead, both supply and demand are strong, but there is insufficient cost support. Given that the price of PA is already low, the room for further decline is limited. It is expected that the price of PA will remain weak and consolidate at a low level.