Both Supply and Demand Weak, Plus Prices Falling Below the Moving Average—Isooctanol Prices Fluctuate and Decline in April

April 27 News

April iso-octanol prices fluctuated and declined in China.

According to the commodity market analysis system, on April 27, the price of isooctanol was 8,933.33 CNY/ton, down from 9,233.33 CNY/ton at the beginning of this month—a decrease of 3.60%. However, compared to the price of 6,700 CNY/ton at the beginning of March, the cumulative price increase still reached 36.32%, placing it within the overheat alert range for the past year. Throughout April, the isooctanol market exhibited an overall pattern of "high-level fluctuations—strong initially, then weakening." At the start of the month, prices continued the strong upward trend from March, reaching the year's peak; subsequently, affected by declining costs and a stalemate between supply and demand, prices gradually retreated. For the entire month, prices fluctuated around the 9,000–9,500 CNY/ton range, remaining at relatively high levels for the year. The market dynamics were primarily driven by the linkage between crude oil and propylene prices, as well as changes in supply-demand conditions. Meanwhile, starting from mid-April, the moving average of prices began to shift downward, making the downward trend in isooctanol prices clearly evident.

SpotCom system signal shows: the strengthening of bearish forces is limited.

The difference (10-day moving average - 20-day moving average) is a core indicator for judging trends. Looking at the moving average trend of isooctanol prices in China: starting from April 17, the 10-day moving average crossed below the 20-day moving average, and the difference turned from positive to negative, indicating the arrival of a downward signal. After that, the 10-day moving average continued to run below the 20-day moving average, and the gap between the two moving averages remained stable, with the difference entering a stalemate range, indicating that the downward momentum already exists, but the strength of the bears has limited increase.

On April 26, the price range of 2-ethylhexanol in China remains high over a one-year period, but within a 30-day period (at 10-day, 20-day, and 30-day positions), the price range is at a low level. The price has shown a short-term decline, approaching the spot price, indicating a signal for a price correction. Given the high prices over the past year, there is still a desire for a decrease in the market price of 2-ethylhexanol. The market trend for 2-ethylhexanol is weak and stagnant, with a high risk of further declines.

Cost Side: Crude Oil + Propylene Linked, Supporting Initially Strong Then Weakening

According to the commodity market analysis system, from April 1 to April 7: propylene futures prices were at a high level. On April 7, the closing price of the main propylene contract reached 9,447 CNY/ton. Coupled with the support of crude oil prices due to geopolitical factors, the cost support for 2-ethylhexanol was strong, driving prices up. With the ceasefire agreement between the United States and Iran taking effect, crude oil prices plummeted, and propylene prices adjusted downward in tandem. By April 27, the closing price of the main propylene contract had dropped to 8,360 CNY/ton, a decrease of 11.51% compared to April 7. The cost support for 2-ethylhexanol weakened, leading to a pressured price adjustment. Moreover, the propylene to 2-ethylhexanol price ratio index remained high, further increasing the downward pressure on 2-ethylhexanol.

2-Ethylhexanol supply and demand are both weak in China

In April, isooctanol production in China remained high, but the operating load of isooctanol plants decreased, with the operating rate dropping to around 80% by the end of the month, leading to a reduction in isooctanol supply. Downstream demand was mainly characterized by rigid demand procurement. The operating rate of plasticizer enterprises in China decreased in April, with DOP operating load falling from 66% in March to 55% in April. As a result, the demand for isooctanol from plasticizers decreased, weakening the upward momentum of isooctanol prices. Both the supply and demand for isooctanol showed weakness.

Outlook for the Future

The analyst specializing in octanol product data believes that, on the cost side, crude oil prices are unlikely to rebound significantly due to the impact of the U.S.-Iran ceasefire. Propylene prices will probably remain volatile, and the cost support for isooctanol continues to weaken. On the supply-and-demand side, both isooctanol producers and plasticizer manufacturers have seen a decline in plant operating rates, resulting in weak supply and demand that make it difficult to sustain price increases. Overall, with declining costs and weak supply and demand, we expect isooctanol prices to experience slight fluctuations and a downward trend in the near future.