October 30th, news
In October, the phenol market in East China showed an overall upward trend with continuous price increases, continuing the upward momentum from September. The fluctuations within the month intensified, and there was fierce competition between bulls and bears. At the beginning of the month, the market price for premium phenol in East China was around 8,900 CNY/ton. After a small initial decline to around 9,200 CNY/ton, prices rebounded and reached nearly 9,900 CNY/ton by the end of the month. The price increase was significant, and the overall pattern was characterized by "fluctuating increases and strengthening at higher levels."
From the supply side, the concentrated maintenance of phenol plants in China is gradually coming to an end, but the recovery of some plant loads is slow. Coupled with limited imports arriving at ports, port inventory remains low, and the available spot supply is tight, providing strong support to the market. Upstream pure benzene is operating at high levels due to support from crude oil prices and refinery maintenance, continuously underpinning phenol prices. The production costs for phenol and acetone enterprises remain high, and manufacturers have a strong intention to maintain high prices, with offers continuing to rise.
On the demand side, downstream industries such as bisphenol A and phenolic resins have seen a month-on-month increase in operating rates, with BPA producers actively fulfilling essential procurement needs, thereby supporting phenol demand. However, end‑use sectors like plastics and electronic circuit boards have shown limited follow‑through; most downstream players rely primarily on contract purchases, and amid elevated price levels, speculative buying remains subdued, with buyers adopting a cautious stance toward chasing higher prices. This reluctance to pay premiums is a key driver of the frequent pullbacks observed during the market’s upward move. Each time prices surge rapidly, downstream sentiment turns more resistant, transaction activity slows, and the market experiences a brief setback for consolidation.
On the market sentiment front, at the start of the month, expectations for the outlook remained cautious. As inventories continued to decline and spot supplies tightened, bullish sentiment gradually strengthened, with traders holding back sales and raising their asking prices, driving prices to repeatedly hit new intraday highs. However, as prices climbed to elevated levels, divergences over the sustainability of these high price levels widened, prompting some traders to exit for profits and tempering the pace of further gains.
It is expected that, in the short term, phenol prices will continue to be supported by cost factors and low inventory levels, keeping the market in a high‑range trading pattern; however, there is limited room for further sharp gains. On the one hand, high benzene prices remain a key support, making substantial downside on the feedstock side unlikely in the near term. On the other hand, as maintenance‑shut units gradually ramp up production, expectations of increased domestic phenol supply are steadily emerging, while downstream terminal demand is unlikely to experience explosive growth. Consequently, the upward pressure on prices will gradually ease, with the price center of gravity likely to drift slightly lower, within a trading range of 9,000–9,700 CNY per ton. Ongoing monitoring of benzene and crude oil trends, phenol plant operating rates, and changes in bisphenol A downstream demand remains essential, with vigilance required to guard against downside risks stemming from a concentrated release of supply.
