Construction Starts Decline, Isocyanide Prices Surge After the Holiday

May 9th News

Post-holiday prices of isooctanol fluctuated and rose in China

According to the commodity market analysis system, the price of 2-ethylhexanol on May 9 was 9066.67 CNY/ton, an increase of 3.03% from the beginning of the month at 8800 CNY/ton, and a decrease of 2.16% from April 1 at 9266.67 CNY/ton. After the holiday, the price of 2-ethylhexanol has risen compared to the end of April, but it is still lower than the beginning of April. In 2026, the Chinese 2-ethylhexanol market is in a critical period of tight supply-demand balance and structural transformation, with multiple factors such as new capacity, cost fluctuation risks, and increased exports affecting the wide-ranging adjustments in 2-ethylhexanol prices. After the holiday, the operating load of 2-ethylhexanol enterprises decreased, leading to a temporary tightening of 2-ethylhexanol supply, and the price of 2-ethylhexanol rebounded and rose.

Propylene cost high support weakens

According to the commodity market analysis system, as we enter May, more propylene production facilities in China are resuming operations, increasing propylene supply. However, weak demand has led to a fluctuating decline in propylene prices after the holiday. The uncertainty of the geopolitical situation in the Middle East may support raw material costs, preventing prices from falling further, and propylene prices remain at a relatively high level historically. The price decline after the holiday is more like a technical correction following a rapid rise, rather than a trend reversal. High propylene prices support the bottom price of 2-ethylhexanol, and producers' willingness to hold prices firm has increased, providing support to the bottom price of 2-ethylhexanol. However, the decline in propylene prices after the holiday has weakened the cost support for high-priced 2-ethylhexanol.

2-ethylhexanol production load decreases in China

At the end of April, the operating load of 2-ethylhexanol enterprises in China increased to 98%. After the holiday, the operating load of 2-ethylhexanol facilities decreased to 88%, leading to a reduction in 2-ethylhexanol supply. Some facilities still have maintenance plans after the holiday, with "the first phase of the 330,000-ton facility at Shuguang scheduled for maintenance in mid-to-late May." The supply side may subsequently experience further contraction. This supply tightening will support the increase in 2-ethylhexanol prices.

2026 will see a peak period for the commissioning of new capacity in the isooctanol industry. The concentrated introduction of this new capacity will significantly impact the balance between supply and demand in the market, intensifying pressure from overcapacity. In the short term, influenced by changes in market supply and demand as well as enterprise maintenance schedules, the industry’s operating rate will experience substantial fluctuations. However, in the medium to long term, the volatility of the industry’s operating rate will narrow. It is expected that throughout 2026, the operating rate will fluctuate within a narrower range of 80% to 85%. Affected by the commissioning of new facilities, temporary environmental production restrictions, and adjustments in corporate profits, the supply side will become less flexible. Overall, the pattern of overcapacity in isooctanol will further intensify, and market competition will become even fiercer.

Outlook for the Future Market

The analyst specializing in octanol product data believes that, on the cost side, propylene prices have fallen after the holiday, weakening the cost support for isooctanol. However, due to geopolitical factors affecting crude oil prices, there is strong upward pressure on propylene, limiting the room for further declines in propylene prices and thus reducing downward pressure on isooctanol in the near term. On the supply side, significant new capacity has been added for isooctanol, increasing supply pressure. Although post-holiday plant operating rates among isooctanol producers have declined, tightening supply conditions are providing some support for isooctanol price increases. On the demand side, downstream plasticizer manufacturers maintain stable operating rates, providing solid fundamental support for isooctanol demand. Additionally, rising exports offer some upward momentum for isooctanol prices. Looking ahead, while costs remain high and supply is tight in the short term but expected to become oversupplied in the medium to long term, overall demand for isooctanol lacks structural growth. As a result, the market situation of oversupply is unlikely to change. Consequently, there is insufficient upward momentum for isooctanol prices in the future. Nevertheless, given the impact of geopolitical factors, the downside potential for isooctanol prices is limited. Therefore, we expect isooctanol prices to fluctuate weakly but tend toward stabilization in the coming period.