Bearish Factors Exhausted, Hydrogen Peroxide Prices Still Have Room to Rise in Late May

May 12th, news:

According to SpotCom data: In early May, the hydrogen peroxide market plummeted, but demand improved, leading to a steady rise in the hydrogen peroxide market. At the beginning of the month, the average market price of hydrogen peroxide in China was 1,223 CNY/ton. By May 12, the average market price had dropped to 916 CNY/ton, a decrease of 25%.

Reasons for the decline in hydrogen peroxide prices

On the supply side: After the May Day holiday, hydrogen peroxide manufacturers have resumed operations, with the national operating rate approaching 80%. Earlier maintenance periods have largely concluded, leading to increased sales of supporting facilities (propylene oxide/caprolactam). As a result, supply is gradually easing, and supply pressure is mounting in southern regions.

On the demand side: The downstream peak season is gradually coming to an end. End-users show only moderate acceptance of high-priced hydrogen peroxide, putting pressure on profit margins. Some manufacturers have reduced production and are now purchasing only as needed, leading to a decline in overall procurement volumes. New-energy manufacturers remain cautious at higher price levels, resulting in fewer orders. As demand weakens, buyers are opting to purchase when prices rise rather than when they fall, leaving the market with sluggish trading activity.

On the cost side: With raw materials becoming more flexible and support weakening, prices of liquid chlorine and hydrogen have declined, pushing production costs lower and increasing companies' willingness to offer price concessions.

Technical analysis forecast for hydrogen peroxide spot market: From the price trend chart of hydrogen peroxide, key indicators show that in early May, the 10-day moving average of hydrogen peroxide crossed below the 20-day moving average. In the first half of May, the spot market for hydrogen peroxide plummeted, with prices continuously falling. The probability of a price decline for hydrogen peroxide is higher in the latter part of the month.

Auxiliary Indicator: In early May, the price of hydrogen peroxide reached a low on the 10th, another low on the 20th, and a mid-to-low level on the 30th, indicating that, in the long term, there is still room for hydrogen peroxide prices to rise.

To sum up: In late May, the fundamentals of China’s hydrogen peroxide market saw a tug-of-war between bullish and bearish forces. Supply pressure remained persistent, while terminal demand was moderate. From a technical perspective, the hydrogen peroxide market was at a low point in early May, but in late May, it experienced broad-range fluctuations overall, with a relatively high probability of rising prices. We expect prices to range between 750 CNY/ton and 900 CNY/ton.