January China Phenol Market Experiences a Significant Price Increase

January 29 news

In January 2026, the Chinese phenol market overcame its initial weakness at the beginning of the month and showed a broad upward trend characterized by "reaching the bottom and then continuously rising," becoming a highlight in the chemical market at the start of the year. According to monitoring, the mainstream quotation in the East China region rose from 5,750 CNY/ton on January 1st to 6,250 CNY/ton on January 29th, with a cumulative price increase of about 8.7% for the entire month. Significant changes in supply and demand, costs, and industrial chain linkage pushed prices to achieve a phased breakthrough.

This month, the phenol market in China followed the main theme of "inventory digestion—cost-driven—tight supply-demand balance," with an overall gradual strengthening. At the beginning of the month, the inventory at Jiangyin Port exceeded 21,000 tons, and a large amount of imported goods arrived, leading to concessions from suppliers and a slight decline in the market. After mid-month, the prices of raw materials, such as pure benzene and propylene, increased, raising costs. Led by adjustments from major players like Sinopec, coupled with reduced production capacity, lower-than-expected imports, and pre-holiday stockpiling by downstream buyers, quotations climbed to 6,000-6,250 CNY/ton, indicating a shift toward a tight supply-demand balance. Factories continued to raise prices, and downstream bisphenol A also strengthened, with active trading and accelerating price increases.

Cost support: Both pure benzene and propylene, as raw materials, have shown a strong upward trend, providing firm support. The price of pure benzene, influenced by high and volatile international crude oil prices, unexpected destocking of styrene plants in China, and a recovery in demand, has risen from 8,800 CNY/ton at the beginning of the month to over 9,500 CNY/ton by the end of the month. Propylene prices have also increased due to the maintenance of multiple PDH plants in Shandong, leading to a temporary supply shortage. To alleviate production cost pressure, phenol and acetone manufacturers have continuously raised the ex-factory prices of phenol, becoming the core driver for the rise in market prices.

The supply-demand dynamic has reversed: shrinking supply and a rebounding demand are providing mutual support, driving the supply-demand balance from loose to tight. On the supply side, China’s leading phenol-ketone producers have scheduled maintenance ahead of the Spring Festival, with some plants operating at reduced capacity, thereby reducing the release of effective production capacity. Coupled with lower-than-expected arrivals of imported supplies, the overall market supply continues to contract. On the demand side, downstream bisphenol A and phenolic resins are being driven by pre-holiday restocking demand for epoxy resins, resulting in a steady increase in rigid demand procurement volumes. Additionally, traders’ temporary stockpiling activities have further amplified demand, laying a solid foundation for price increases.

The decline in port inventories coupled with a growing willingness to hold prices has helped solidify the upward price trend. As shipments continue, port inventories have fallen from 21,000 tons at the beginning of the month to below 15,000 tons, establishing a tight balance between supply and demand. Consequently, sellers’ willingness to offer lower prices has significantly weakened, and there’s a strong sentiment among suppliers to hold prices and be reluctant to sell. The pricing adjustments made by leading enterprises continue to boost market confidence, while pre-holiday stocking demand from end-users is being released in stages. Strong, rigid demand continues to support the market, and combined with traders’ hoarding behavior that amplifies market sentiment, this creates a virtuous cycle that steadily propels prices higher.

As of January 29, the phenol quotations in major markets across China are as follows:

In the short term, the phenol market in China will maintain a high level of fluctuation from late January to before the Spring Festival. The tight supply and demand of benzene, high crude oil prices, and low inventory levels provide supportive factors, making it difficult for prices to fall significantly. However, the decrease in terminal operations, shrinking demand, and expectations of post-holiday imports and plant resumptions pose potential pressures, with a risk of price correction after the holiday. It is recommended that traders prioritize realizing profits and controlling inventory, while downstream enterprises should replenish stocks as needed in small quantities without blindly stockpiling, and pay attention to the opportunity for price corrections after the holiday.