June 16 news
I. Price Trends
This week, the spot price of acrylic acid in China has shown a trend of stopping the decline and rebounding. Monitoring data shows that as of June 16, the benchmark price of acrylic acid was 8,516.67 CNY/ton, an increase of 2.00% compared to the beginning of the week (8,350.00 CNY/ton). The market focus has slightly shifted upwards.
II. Supply, Demand, and Cost Fundamentals
1. Cost Side
Upstream raw material propylene prices have fallen, and the production cost of acrylic acid lacks strong support. The space for restoring production profits in the industry is limited, and factories are not very willing to significantly increase the price of spot goods. This round of price increases is not driven by costs. As of June 16, the benchmark price of propylene in China was 8,667.67 CNY/ton, a decrease of 5.11% compared to the beginning of the month (9,134.33 CNY/ton).
2. Demand Side
This round of price increase is mainly driven by the downstream rigid demand. Previously, downstream acrylic ester and specialty ester companies were mainly consuming goods from long-term contracts. Some end-users replenished their stocks at low prices, leading to a recovery in spot market transactions. As a result, holders adjusted their offers upward, lifting the overall market price. However, there was no large-scale concentrated restocking by the downstream sector, and the increase in demand was limited, making it difficult to drive a significant surge in prices.
3. Interpretation of the Spotcom Moving Average Difference Index and Price Position Signals
1. Equal Difference Indicator: Decline Slows Down, Signaling an Upward Rebound in the Short Term
This week, after the price hit bottom and rebounded, the downward speed of the 10-day moving average significantly slowed down, and the difference with the 20-day moving average continued to narrow. The negative average difference continued to decrease, indicating a significant weakening of the previous downward momentum. On June 15, the spot price surged, crossing above both the 10-day and 20-day moving averages. The moving average system is about to see the average difference turn from negative to positive (the moving average crossover), which is a signal for the start of a short-term rise in the spot price.
2. Cycle price position: It has temporarily moved away from the absolute low, but there are still constraints on the upside potential.
After the price increase on June 15, the 10-day cycle shifted directly to a high position, while the 20-day cycle returned to the median range. The 30-, 60-, and 90-day cycles remain in the mid-to-low or low range.
The short-term oversold rebound is now being realized, but in the medium to long term, prices remain at historically low levels. The medium- and long-term moving averages above are exerting significant downward pressure. This round of rebound is a bottom-level correction, and its sustainability and magnitude of price increase are both constrained.
4. Future Market Outlook
In the short term, the benefits of downstream rigid demand restocking are still ongoing, coupled with a bottom reversal signal appearing in the moving average, acrylic acid spot prices may continue to show a slightly strong trend; however, there is no support from the raw material end, and there is no significant increase in overall downstream production, so the market lacks the core driving force for sustained substantial growth.
From a medium to long-term perspective, the 60-day and 90-day cycle prices are still at a low level. If subsequent downstream demand is further released and the raw material end stabilizes after stopping the decline, there will be room for a sustained recovery in the market; conversely, after the rigid restocking demand ends, the market may return to a phase of fluctuation and consolidation.
