Essential Demand Drives Acrylic Market to Trade Sideways

November 04, News

Since November, the Chinese acrylic acid market has generally shown a "stable but slightly weak" trend, with the fundamental driving force being "terminal rigid demand purchasing." The market lacks strong momentum for either upward or downward movement. Under the interplay of bullish and bearish factors, prices have fluctuated narrowly, with transactions mainly consisting of small, rigid-demand orders.

Overall market performance: "Stability" remains the dominant theme.

Price level: As of November 4, the benchmark price for acrylic acid in China was 6,500.00 CNY/ton, unchanged from the beginning of the month.

Transaction Level: The "essential purchasing" characteristic is evident. Downstream factories and traders generally remain cautious, with most entering the market primarily to meet short-term production needs—large-scale orders or bulk stockpiling are rare. Market activity remains tepid, and the "one deal, one negotiation" approach prevails across transactions.

1. Demand Side:

Mainstream downstream performance is lackluster:

Acrylate esters (such as butyl acrylate): The downstream industries, including adhesive tapes and coatings, are in the traditional off-season in China, with limited order increments. The consumption rate of raw materials is stable, making it difficult to form a concentrated purchasing trend.

SAP (Super Absorbent Polymers): Primarily used in the hygiene products sector, demand remains relatively stable, though there’s a lack of growth opportunities exceeding expectations.

Polymer emulsions: Demand is moderate in the construction and textile sectors.

Buy high, not low mentality: Due to a cautious outlook on the future market, end-users in China generally do not have a strong desire to stock up. When prices are stable or even slightly easing, they tend to "purchase as needed," waiting for lower prices or clearer market signals.

2. Supply side:

Operating rates remain at moderate to high levels: Since November, the overall operating rate in the acrylic acid industry has stayed steady between 65% and 70%. Although some units have undergone routine maintenance, this hasn’t significantly impacted market supply, ensuring a plentiful availability of goods.

Inventory pressure is manageable: The production facility’s overall inventory levels remain at a moderate point, with no significant buildup of excess stock. This gives the factory confidence in price negotiations, making it reluctant to slash prices aggressively—thereby providing solid support for pricing from the bottom end.

3. Cost side:

Raw material propylene prices have weakened: After November, the price of the main raw material, propylene, has shown a certain degree of decline. As of November 4, the benchmark price for propylene was 6018.25 CNY/ton, a decrease of 0.66% compared to the beginning of the month (6058.25 CNY/ton). This has weakened the cost support for acrylic acid, providing room for its price to fall. The easing of costs has somewhat relieved the profit pressure on acrylic acid plants, but at the same time, it has also reduced the market's acceptance of high-priced acrylic acid.

Future Outlook:

Short term (through the end of November): The market will likely continue its "stable yet weak, demand-driven" pattern. In the absence of significant positive or negative news, prices are expected to fluctuate within a narrow range. If raw material propylene continues to weaken, acrylic acid prices may see a slight downward shift in their price center.

Summary:

For "terminal rigid demand purchasing," the acrylic acid market since November has been a typical "buyer's market." Buyers have significant bargaining power and a wide range of choices, allowing them to purchase according to their own production schedules without worrying about supply shortages or sudden price hikes. In summary, behind the "stable operation" is the full manifestation of the "rigid demand purchasing" logic under a weak balance between supply and demand. The market is waiting for new driving factors to break this balance.