October 1st News
In September, the Chinese ABS market showed fluctuating trends, with spot prices for various grades experiencing fluctuations, but generally increasing. According to Spotcom data, as of September 30, the average price of sampled ABS products was 11,316.67 CNY/ton, a 5.43% increase from the beginning of the month.
Fundamental Analysis
Supply Level: Entering September, the plant load in China's ABS industry remained largely stable with minor fluctuations. The overall operating rate within the range fluctuated and fell to around 55%, with the current weekly production volume within 120,000 tons. The finished goods inventory is at a manageable level, having decreased to less than 190,000 tons. The shipment situation from polymer plants within the range was average, and profitability was poor. Polymer plants are expected to continue cost reduction operations, leading to a supply contraction. Overall, the supply side of ABS in September provided moderate support for the spot price.
Cost Factors: In mid-September, geopolitical tensions in the Middle East remained volatile, with ceasefire agreements proving difficult to implement, thereby pushing international crude oil prices higher. In the second half of the month, Iran conveyed clear conditions to mediators for resuming negotiations, and the U.S. and Iranian presidents engaged in direct talks. At the same time, multiple signals indicated that the escalating U.S.–Iran standoff was beginning to yield tangible diplomatic breakthroughs. As a result, market attention shifted from “supply‑disruption fears” to “de‑escalation and supply restoration,” causing styrene prices to reverse course from strength to weakness. However, recent traffic through the Strait of Hormuz has remained at single-digit levels, with no substantial improvement in risks, leaving market concerns about global crude oil supplies intact. Meanwhile, robust benzene prices continue to provide support to styrene.
The acrylonitrile market, although supported by the rise in crude oil prices mid-month, was weighed down by high operating rates and low consumption, which suppressed spot prices. In the first ten days of the month, new production capacities of 660,000 tons from Zhejiang Petrochemical and 130,000 tons from Sino-British Petrochemical will be put into operation, leading to an oversupply in the acrylonitrile market. After the initial decline at the beginning of the month, the cost side has stabilized. Currently, demand remains weak, making it more likely for acrylonitrile prices to fall than to rise in the future.
Butadiene saw a trend of initial decline followed by an upward fluctuation in September. The core drivers of the monthly market volatility were the phased adjustments in the supply and demand landscape, combined with fluctuations in raw material costs, concentrated plant maintenance, and a seasonal recovery in downstream demand. At the same time, changes in market sentiment and trading psychology further amplified the market fluctuations, breaking away from the previously weak operating pattern. In the future, it will be important to closely monitor the price fluctuations of upstream raw materials, changes in the operation of Chinese facilities, and the follow-up of downstream terminal demand.
Demand Side: In September, there were only limited changes in the operating rates of downstream ABS producers. Profitability in the key end‑use appliance sector improved only marginally, and buyers remained reluctant to pay premium prices, opting instead for a just‑in‑time purchasing approach. Market participants showed little appetite for chasing higher prices, with sellers adjusting their pricing to match prevailing market conditions in order to accelerate cash recovery. Overall, demand in September was somewhat subdued, with no clear signs of a significant volume boost typical of the traditional peak season.
Future Market Prediction
In September, the ABS market in China experienced a wide fluctuation after a rise. During this period, the three types of raw materials showed mixed increases and decreases, but overall, the cost side remained relatively strong. The production load of polymer plants changed slightly, with low inventory, but the supply within the market still remained relatively abundant. ABS consumption was average during this period, and the profitability per unit did not improve. The current upward momentum in the market is mainly driven by the cost at the far end, and it is recommended to closely monitor the crude oil market for future trends.
