Price Increase Announcements Concentrated, Chinese Polymeric MDI Market Pushes for Rise

February 28 news

According to the commodity market analysis system, from February 23 to 28, China's polymer MDI market prices showed a generally strong upward trend. The average price at the beginning of the week was 14,000 CNY per ton, rising to an average of 14,400 CNY per ton by February 28—a weekly increase of 2.86% and a year-on-year decrease of 22.16%. During the week, BASF, Covestro, and Huntsman successively announced price hikes for MDI in North America and ASEAN regions. Major Chinese manufacturers also raised their March quotes one after another, prompting traders to quickly follow suit. Downstream buyers entered the market only as needed, and a wait-and-see attitude is gradually becoming more pronounced.

Supply side: Chinese MDI plants are operating normally. The 650,000 tons/year MDI plant of BASF in Belgium is running at low capacity and is expected to continue until March. Kumho in South Korea has a maintenance plan in April.

Cost Perspective: Recently, the price of raw material pure benzene has closely followed crude oil fluctuations. Downstream buyers are procuring materials on a demand-driven basis, primarily taking advantage of lower prices. Inventory levels at major ports in East China continue to rise, putting overall downward pressure on spot prices and limiting the extent of price increases. Since the holiday period, aniline prices have continued to climb: on February 23, the market price for aniline was 8,845 CNY per ton, and by February 28, the price had risen to 9,145 CNY per ton—a gain of 3.39% over the period.

Demand Side: Downstream demand is entering the market on an as-needed basis, and the market is gradually recovering after the holiday period; however, demand still has room for improvement.

Looking ahead, the current polymeric MDI market is supported by relatively strong news on the supply side; however, demand trends remain to be seen in terms of market feedback. It is expected that, in the short term, the polymeric MDI market will continue to run on a relatively strong note.