June 7th news
The commodity market analysis system shows that the recent Chinese formic acid market has exhibited a "first stable then rising, continuously climbing" phase, overall breaking away from the previous weak situation, completing a market reversal from weak equilibrium to steady upward trend. The supply and demand structure of the market continues to optimize, and the trading atmosphere in the industry continues to warm up. As of July 6, the benchmark price for industrial-grade 85% formic acid in China was 2,300 CNY per ton, an increase of 13.86% from the end of June.
Phase 1: Sideways Consolidation
From June 29 to 30, the formic acid market in China continued its previous sluggish trend, with the mainstream average price remaining stable at 2,020 CNY/ton, showing no significant fluctuations. The overall market is in a state of weak equilibrium, and the industry's mainstream expectations are bearish, with the downward pressure from the previous market trend still present. However, there are signs of a market recovery, as some producers have slightly increased their quotations. Additionally, news of delayed resumption of production facilities has had an impact, leading to a slight improvement in the purchasing mentality of downstream buyers and an increase in procurement enthusiasm. This has contributed to a steady decline in manufacturers' inventories, laying the foundation for future price increases.
Phase 2: Continuous Uptrend
During the consecutive upward phase from July 1 to 3, the market kicked off a three-day rally, with price increases showing steady and even performance. On July 1, the market reached an inflection point, triggering a sharp rise in prices; the average price climbed to 2,100 CNY per ton, with a single-day price increase of 4%. As shipment trends continued to improve and downstream end-users’ restocking demand kept rising, coupled with manufacturers’ inventories steadily declining, multiple positive factors came together to provide strong support, driving the market to remain robust. The upward momentum continued over the following two days, and on July 3, prices rose once again, with the average price climbing to 2,300 CNY per ton—a single-day price increase of 9.52%.
Market Forecast: Prices "break out," supported by supply and demand, and may continue to rise.
The commodity market analysis system shows: Recently, the formic acid curve has shown a "crossover" (short-term moving average crossing above the long-term moving average), indicating an upward trend.
Moreover, prices are at a long-term low, leaving considerable room for upward movement.
Combining the fundamentals: The industry inventory has fallen back to the mid-range, with some companies limiting shipments to tighten spot supply. At the same time, concentrated restocking by downstream sectors has driven a surge in trading activity. The convergence of supply and demand benefits has completely reversed the weak market situation. The formic acid market in China is likely to continue its strong operating trend.
