Acrylic Acid Market "Hovers" Between Rise and Fall, When is This Temporary Calm Expected to End in China?

January 12 news

The current acrylic acid market in China is experiencing a "difficult to rise or fall" situation. As of January 12, the benchmark price of acrylic acid is 5866.67 CNY/ton, which is a 0.28% increase from the beginning of the month (5850.00 CNY/ton).

Cost side:

The price of the main raw material, propylene, remained relatively firm against the backdrop of winter demand and fluctuating international oil prices. As of January 12, the benchmark price of propylene was 5871.00 CNY/ton, an increase of 2.68% compared to the beginning of the month (5717.67 CNY/ton). This also sets the cost floor for acrylic acid. The profit margins of producers have been squeezed, and they are not willing to lower prices proactively.

Supply Side:

Despite 2025-2026 being a period of new acrylic acid capacity additions in China, since the beginning of the year, some major factories have conducted unplanned or extended shutdowns for maintenance, offsetting some of the supply increase from the new capacities. The overall industry operating rate has been maintained at 75%-80%, with inventory levels at a moderate level, not creating significant pressure.

Demand Side:

January and February traditionally mark the off-season for downstream industries such as coatings and adhesives, during which procurement is primarily driven by rigid demand. The end-consumer markets—such as real estate and textiles and apparel—are recovering slowly, prompting downstream companies to adopt a strategy of “procuring on demand and maintaining low inventory levels.” Large-scale stockpiling is rare, which has curbed upward price momentum. However, this also means that the market has not accumulated significant speculative inventory risks. Meanwhile, overseas markets—especially in Southeast Asia—continue to demonstrate a degree of resilience, providing China’s suppliers with alternative channels for distribution and helping to prevent a full-blown impact from overcapacity.

"Stable" status, how long can it last?

The current weak balance is fragile and is expected to be broken by the end of the first quarter to the beginning of the second quarter of 2026. Specifically, it depends on the following key variables:

1. The Strength and Pace of Demand Recovery

After March, downstream industries will enter the traditional peak season of "Golden March, Silver April" for inventory preparation. If the effects of real estate policies in China become apparent and the consumer market recovers, driving demand for butyl acrylate (used in coatings) and super absorbent resins (SAP, used in hygiene products) to rebound beyond expectations, the market will quickly clear inventory, and prices are expected to break upward. Conversely, if the peak season demand is "lacking in substance," the market will lose support due to disappointment.

2. Supply-side variables

After the end of the first quarter, previously shut-down units will gradually resume production, while output from newly commissioned capacity will be fully released. As a result, supply pressure will significantly increase in the second quarter. If prices remain stubbornly flat for an extended period, leading to a sustained deterioration in industry profits, some high-cost facilities may be forced to reduce output or even shut down, thereby once again adjusting supply levels.

3. Macro and Cost Environment

The trend of international energy prices will directly reshape the cost line. If there is a trending increase or decrease in crude oil prices, it will disrupt the current balance at the cost end. The actual implementation effect of China's policies to stabilize growth and promote consumption will determine the fundamental direction of terminal demand.

Conclusion: The current "stable" state of the acrylic acid market in China is a dynamic and fragile balance, which is expected to be difficult to sustain beyond the first quarter of 2026. The second quarter will be a critical period for direction selection, with its trend highly dependent on the actual demand performance during the "traditional peak season" and the competition with the supply increment.

For market participants, it is currently not advisable to have excessive expectations for one-sided market movements. Flexible operations and strict inventory control remain the best strategies, and preparations should be made for potential trend-driven market conditions that may appear in the second quarter.