August 4th, according to news,
According to the commodity market analysis system: Recently, the overall formic acid market in China has shown a significant decline and a weak trend, with obvious pressure on the overall market situation and a significant month-on-month price decrease. As of August 4th, the benchmark price for 85% industrial-grade formic acid in China was 1,800 CNY per ton, showing a noticeable drop from previous price highs. The overall market atmosphere is cool, with insufficient trading activity, and the industry as a whole is in a weak off-season. The imbalance between supply and demand is the core factor driving this round of price declines.
The oversupply on the supply side is the core factor behind the continuous weakening of formic acid prices this week. This week, the operating rates of formic acid production enterprises in China have remained stable overall, with mainstream factories running smoothly. The overall supply of goods in the industry is sufficient, and there is a significant accumulation of spot inventory in the market. Most companies had ample stockpiles earlier, and with the continuous release of new supplies into the market, the industry's inventory pressure has been gradually increasing. To quickly clear inventory and recover funds, most producers and traders have proactively reduced their ex-factory quotes, and price concessions for sales are widespread, further lowering the overall quotation level in the market and driving the continuous decline in spot prices. The supply side of the market is completely in a state of oversupply.
Downstream demand remains persistently weak, making it difficult to support price stabilization and recovery. Currently, it is the traditional off-season for chemical consumption in China. The operating rates of terminal industries such as leather, dyeing, pharmaceuticals, and rubber additives, which are downstream of formic acid, are generally low. Terminal enterprises lack orders, leading to insufficient production enthusiasm. Downstream manufacturers mainly engage in small-scale, just-in-time purchases, with little intention to stock up. Overall, the market transaction volume is low, lacking the support of concentrated procurement. The continuous weakness in demand has led to a cold market atmosphere, exacerbating the mismatch between supply and demand, and completely losing the momentum for price increases. This is an important reason for the ongoing weakening of the market.
The cost and market sentiment have further intensified the weak trend of the market. The price of methanol, a key raw material for formic acid, has been relatively weak recently, leading to insufficient cost support at the production end. This has alleviated the cost pressure on enterprises, providing room for price reductions to sell products. At the same time, influenced by the continuous price reduction trend, there is a strong bearish sentiment in the market. Traders generally operate cautiously, reducing prices to follow the market, and the wait-and-see attitude of end-users has increased, forming a weak cycle of "price reduction - observation - further price reduction." Overall, the market trading sentiment is low.
Overall, in the past week, the formic acid market in China has seen a continuous decline in prices due to a combination of ample supply, weak demand during the off-season, and a generally pessimistic market sentiment. In the short term, there are no clear signs of recovery in terminal demand, and the industry still faces inventory pressure. It is expected that the formic acid market will likely continue to experience a weak and volatile trend, with significant difficulties in stabilizing and rebounding prices. The market may continue to operate at low levels, and specific developments will depend on changes in supply and demand.
