In September, formaldehyde experienced a cost driven surge, rising in the second half of the month and then trading sideways at a high level, with the increase narrowing. As of September 28th, the average price of formaldehyde in Shandong Province was reported at 1755 yuan/ton, an increase of 1.59% from mid month and 69.16% from the beginning of the year, setting a new high in prices in nearly five years.
Driving factor analysis
Cost side: The strong rise of methanol is the core driving force of this round. Upstream methanol spot prices rose by over 36% in September, while futures strengthened simultaneously. The closure of the strait and tight supply from Iran led to a significant decrease in port volume, and methanol port inventories hit a 13 year low, providing strong support for formaldehyde costs.
Supply side: Some devices reduce load and contract supply. In early September, some formaldehyde units underwent maintenance and load reduction, coupled with a low inventory pattern, resulting in a gradually tight supply of goods.
On the demand side: Golden September peak season provides temporary support, but the strength is limited. As the small holiday approaches, the downstream artificial board industry in the main production and sales area coincides with the replenishment cycle, and market transactions remain smooth. There is a phased replenishment support under the mentality of buying up and not buying down. However, the overall production of downstream sheet metal enterprises is average, with limited acceptance of high prices, and insufficient sustained driving force from the demand side for prices.
Market forecast:
Taking into account both fundamental and technical factors, formaldehyde is expected to maintain a pattern of high-level fluctuations and consolidation in the short term, with overall strength but limited upward potential. There is a risk of a pullback in the medium term.
Positive supporting factors: The current port inventory of methanol is at a historical low. If overseas supply disruptions continue, methanol will continue to operate at a high level, providing a strong cost bottom support for formaldehyde; The overall inventory of formaldehyde enterprises is not high, and coupled with the expectation of a round of replenishment in the board industry after the holiday, it will form a certain buffer for spot prices, and the probability of a deep decline is not high.
Main risk points: Firstly, methanol is the biggest uncertainty. If overseas shipping risks ease, imported goods return to ports, port inventories begin to accumulate, and methanol prices may fall from a high level, formaldehyde cost support will rapidly weaken; Secondly, the downstream demand gap persists, and there has been no substantial improvement in the real estate chain terminal. Under the pressure of high raw material costs for sheet metal enterprises, profitability is under pressure. Continued high prices will further suppress procurement. Once the post holiday replenishment ends, downstream demand will return to immediate use and procurement, and there is a lack of relay on the demand side; Thirdly, the formaldehyde industry has sufficient production capacity. If high profits continue, the early load reduction maintenance equipment will gradually resume production, and the increase in supply will suppress spot prices.

In September, the PTA market emerged from a trend of first rising and then falling. At the beginning of the month, it was driven by the cost of crude oil and PX, coupled with tight supply caused by previous equipment maintenance, and spot prices fluctuated upwards. After a mid month surge, with the concentrated restart of multiple maintenance equipment, supply pressure rebounded. However, the downstream “Golden September” peak season did not meet expectations, and prices fell back, maintaining an overall range oscillation pattern.
In early September, PTA spot prices strengthened due to cost support, leading to an increase in spot prices. Starting from the middle to late of the month, multiple sets of PTA plants have been restarted and the operating rate of the industry has continued to rise. The market supply has gradually increased, and the market has shifted from destocking in the early stage to slightly accumulating inventory. Spot prices have fallen from high levels. As of September 24th, the benchmark spot price of PTA in East China was 7147 yuan/ton, an increase of 11.86% from the beginning of the month.
The international crude oil market trend first rose and then fell. As of September 23, the settlement price of the November WTI crude oil futures contract in the United States was $92.16 per barrel, and the settlement price of the December Brent crude oil futures contract was $95.41 per barrel. The ongoing geopolitical conflicts have led to a continuous decline in the efficiency of cross-strait navigation, and the tightening of physical supply has provided solid bottom support for oil prices, resulting in an upward trend in crude oil prices. Starting from mid month, with the optimistic expectations of the market for the easing of the conflict in the Middle East and the restoration of crude oil supply, the trading logic of the previous supply panic has been completely reversed. The two benchmark crude oil prices have fallen sharply in sync, both hitting their lowest points since September 9th, and the energy sector as a whole has weakened.
From the perspective of PTA supply, the maintenance equipment was basically restarted in September, and the domestic PTA production steadily released. The processing gap remained at a relatively reasonable level, further stimulating the production enthusiasm of enterprises. The subsequent supply side increment still exists, which suppresses prices.
In addition, the demand side has become the core factor restricting the upward trend of the market. The traditional textile “Golden Nine” peak season has seen weak performance, causing downstream polyester enterprises to suffer losses. Multiple factories have implemented production cuts and maintenance, and the comprehensive operating rate has remained around 74%. The order follow-up of weaving enterprises in Jiangsu and Zhejiang is limited, and downstream purchases are mainly for essential needs. The willingness to actively replenish inventory is not strong, and there has been no obvious outbreak of end consumption. The demand side is difficult to drive PTA to continue to rise, and downstream stocking efforts are also relatively limited before National Day.
In the future, PTA will continue to experience a volatile pattern of cost bottoming out and supply and demand suppression. The cost of crude oil and PX raw materials provides support, but the supply continues to recover and demand falls short of expectations, resulting in insufficient momentum for a significant upward trend. Without the stimulation of a significant increase in crude oil prices, it is difficult to break out of a unilateral surge.

price trend
Recently, the domestic PC market has experienced a decline at a high level, and spot prices of various brands have been lowered. As of September 23rd, the PC mixed benchmark price was around 14950 yuan/ton, with a price increase of 1.70% compared to the beginning of the month and a month on month decrease of 2.71%.
Root cause analysis
Supply side: Since early September, the operating rate of domestic PC aggregation enterprises has been average. The overall industry load rate is around 75%. The production loss gap remains stable, with an average weekly output of nearly 60000 tons. The smoothness of shipments from the aggregation plant is still acceptable. Overall, the supply side’s support for PC is still acceptable.
In terms of raw materials, it can be seen from the above chart that the domestic bisphenol A market has seen a broad upward trend since early September. However, the cost of crude oil at the far end has recently plummeted. The Iranian President will attend a meeting in the United States on September 22, and US President Trump has publicly expressed his willingness to meet with the Iranian President. At the same time, Iran has conveyed clear conditions to the mediator to restart negotiations, marking a substantial diplomatic breakthrough signal in the ongoing US Iran confrontation. The focus of market trading has shifted from “supply interruption panic” to “situation cooling and supply recovery”, with phenol falling synchronously. Although the supply of genuine goods on site tends to be tight and balanced, and the inventory of factories and holders is healthy, the spot price of bisphenol A is high and market expectations are negative. It is expected that the spot price of bisphenol A may experience a decline, and the overall support for PC cost value will weaken.
In terms of demand: As we enter late September, there is still no significant peak season signal for PC downstream factory procurement, and the load position of terminal enterprises continues to operate at a low level. The demand for sheet metal shells and other materials is average. Although the tight supply and demand balance of PC in the early stage supported high quotes from merchants, buyers have strong resistance to high priced goods. In addition, there is no stock available before the holiday, and on-site trading is quiet. The market has a strong wait-and-see atmosphere, and buyers are cautious in stocking up. Overall, the demand side has poor support for PC spot prices.
Future forecast
Recently, the domestic PC market has experienced a high decline. Upstream bisphenol A prices are consolidating at a high level, but the support for PC from remote cost values has fallen sharply, resulting in a bearish outlook in the future. The load of domestic PC aggregation plants is still acceptable, but there will be limited changes in future supply. On site trading is dominated by weak demand, and pre holiday stocking operations are rare. At present, the supply and demand of PC are relatively balanced, and the bearish trend of remote raw materials is gradually spreading. Business analysts believe that PC may fall upstream in the short term and suggest closely monitoring the crude oil and demand sides.

Market trend
In the past week (September 16-22), the PA6 spot market has shifted from a strong consolidation at a high level to a downward trend. At the beginning of the week, the market remained at a high level, and mainstream PA6 slicing enterprises generally lowered their quotes by 500-700 yuan/ton during the week. The focus of market negotiations continued to shift downwards, and the bargaining space for actual orders increased, leading to a loosening of traders’ shipping mentality. At the technical indicator level, the 5-day, 10 day, and 20 day moving averages have all turned negative, forming a clear downward signal; From the perspective of cycle position, the 60 day cycle price is at a medium high level, while the 3-month and 1-year cycles are both in the high range, indicating a relatively high price.
influencing factors
Cost end
Upstream pure benzene oscillation weakened, and although the weekly closing price of caprolactam remained high, the driving force for further upward movement of raw materials weakened, resulting in a marginal weakening of cost support for PA6 chips. After the significant increase in slicing prices in the early stage, the processing profits of aggregation enterprises have been compressed, and it is difficult for the raw material side to continue driving slicing prices upward. The support of costs for the market has weakened.
Supply and demand side
On the supply side, domestic PA6 polymerization plants are operating at a medium to high level, with sufficient supply of spot goods. After the initial price increase, the factory inventory gradually accumulated, and the mentality of raising prices in the early stage loosened. Mainstream factories voluntarily lowered their quotations, and the market circulation of goods is abundant. There is currently no substantial reduction support brought about by centralized maintenance. On the demand side, the actual fulfillment of the “Golden September” peak season fell short of expectations. Although downstream spinning and modified injection molding industries have urgent orders, there are limited new orders at the end. Downstream consumers have a strong resistance to high-level slicing, mostly maintaining a “buy as you go” model. They lack the willingness to actively replenish inventory in large quantities, resulting in significant resistance to high priced goods transactions. The demand side is unable to bear the high prices in the early stage, which has become the main drag on the market downturn.
Future forecast
The short-term PA6 market is expected to be weak and volatile in the future. The raw material caprolactam still has a certain cost to support the bottom, but the current full cycle price is at a high level, and downstream acceptance capacity is limited. The conditions for a significant rebound in the market are not yet met, and there is short-term room for correction and release. Focus on the price fluctuations of pure benzene and caprolactam, factory quotation adjustments, downstream terminal order landing, and pre holiday stocking progress.

On September 21st, the domestic epoxy propane market experienced a weak downward trend. The mainstream negotiated price in Shandong has dropped to 11070-11100 yuan/ton, a decrease of 500 yuan/ton from the previous trading day; The Northeast region has synchronously decreased by 400 yuan/ton. As of September 21st, the benchmark price of epoxy propane in Shengyi Society was 11233.33 yuan/ton, an increase of 17.01% compared to the beginning of this month.
On the raw material side, cost support has weakened. Previously, the price of propylene was strongly supported by the rising costs of crude oil and propane, but after entering this week, there were signs of a decline in crude oil and propylene prices, and the cost side’s support for epoxy propane weakened, leading to a bearish market sentiment. As of September 21st, the benchmark price of propylene in Shengyi Society was 9641.00 yuan/ton, an increase of 7.39% compared to the beginning of this month (8977.67 yuan/ton).
Supply side: Early maintenance devices are gradually being restarted. The device has resumed operation, and the market supply has significantly increased compared to the previous period, easing the tight spot situation. The domestic capacity utilization rate has rebounded from around 64% to around 70%, and the expected increase in supply is gradually being implemented.
On the demand side, the peak season of “Golden September” has shown mild performance, and the overall operating rate of downstream polyether enterprises is not high. There is a clear resistance to high priced raw materials, and they mainly purchase small orders for essential needs, with limited increase in new orders. Other downstream products such as propylene glycol also show a stalemate pattern of cost support and weak demand, with insufficient follow-up on epoxy propane procurement.
Comprehensive forecast: Loose cost support combined with increased supply realization, coupled with weak downstream demand follow-up, may lead to a weak consolidation trend in the short-term epoxy propane market. It is necessary to focus on the pace of device restart and volume increase, as well as changes in downstream stocking willingness.