Supply-side Contraction, Inventory Supports Stable Price Operations

December 5th News

According to the commodity market analysis system: The recent formic acid market in China has been stable. As of December 5, the benchmark price of formic acid is 2,910 CNY per ton, compared to the same period last week (November 28), on a week-on-week and year-on-year basis.

The supply side is experiencing a noticeable contraction.

In Liaocheng, some facilities of a large production enterprise are already under maintenance, which is expected to last for one month. Meanwhile, a major manufacturer in Feicheng has implemented production reduction measures, leading to an overall decrease in the market supply.

High inventory levels coupled with weak demand

The current market inventory is at a moderately high level, with shipment volumes relatively lower than before. Demand is characterized by "essential demand dominance and limited growth." End-users generally adopt a strategy of purchasing according to their needs, resulting in a flat overall market demand and a lack of significant growth momentum.

Formic acid data analysts believe that in early December, the formic acid market prices in China will remain stable. Although the supply side has contracted due to maintenance and production cuts by companies, ample industry inventory has become an important support for price stability, keeping the supply and demand balance. In the short term, if there are no significant changes in the supply-side maintenance and production cuts, and the inventory level remains at its current state, it is expected that the formic acid market prices in China will continue to maintain a stable trend.