1、 Price trend

According to data from Business Society, as of April 14th, the reference average price of 85% thermal phosphoric acid in China was 7137 yuan/ton, which is 7450 yuan/ton compared to the reference average price on April 10th. This week, the domestic price of thermal phosphoric acid decreased by 4.19%.

According to data from Business News Agency, as of April 14th, the reference average price of 85% wet process phosphoric acid in China was 7350 yuan/ton, which is 2.22% lower than the reference average price of 7516 yuan/ton on April 10th.

2、 Market analysis

Phosphoric acid prices continued to decline this week. At present, the phosphoric acid market continues to operate weakly. Raw phosphorus ore and yellow phosphorus continue to have a weak market, with prices falling and cost support weak. Downstream demand remains weak, with a strong bearish sentiment in the market. As of April 14th, the factory quotation for 85% thermal phosphoric acid in Sichuan region is around 6850-7200 yuan/ton, the factory quotation for 85% thermal phosphoric acid in Yunnan region is around 7600 yuan/ton, and the factory quotation for 85% thermal phosphoric acid in Hubei region is around 6900-7200 yuan/ton. The domestic market quotation for 85% wet process phosphoric acid is around 6750-8000 yuan/ton.

In terms of raw material yellow phosphorus, the price of Yunnan Guizhou yellow phosphorus market fell this week. At present, the overall market trading situation of yellow phosphorus is not good, and there is light demand on the market. Some enterprises are parking, and the operating rate of yellow phosphorus is slowly decreasing. The on-site inventory is still acceptable, and the supply and demand are still relatively stagnant. The enterprise will not provide external quotations for the time being, and the actual order will be discussed in detail. Downstream procurement is more cautious, with moderate stocking and a focus on immediate demand. As of now, the mainstream quotation is around 26000-29000 yuan/ton, and the actual transaction is negotiable.

In terms of raw phosphorus ore, the overall domestic phosphorus ore market this week was slightly weak and moving downwards. The overall downstream demand side of the domestic phosphorus ore market is showing a weakening trend. Due to the weak and downward trend of the downstream yellow phosphorus market, the trading atmosphere in the yellow phosphorus market is light, and the demand support for phosphorus ore from below has become loose. Therefore, some phosphorus ore enterprises in Yunnan region continue to lower the price of whole phosphorus ore this week, with a decrease of around 10-50 yuan/ton.

3、 Future Market Forecast

Phosphoric acid analysts from the business community believe that the current market trend of phosphoric acid raw materials is not good, and downstream demand is weak. It is expected that the price of phosphoric acid market will continue to be weak in the short term due to the uncertainty. It is suggested to wait and see the trend of raw materials.

According to the bulk commodity list data of Business Society, the recent market price of formaldehyde in Shandong has fluctuated and declined. At the beginning of the week, the average price of formaldehyde in Shandong was 1223.33 yuan/ton, and at the end of the week, the average price of formaldehyde in Shandong was 1200.00 yuan/ton, a decrease of 1.91%. The current price has decreased by 15.94% compared to last year.

formaldehyde

Recently, the price of formaldehyde market in Shandong has fluctuated and dropped. It can be seen from the figure above that the recent market of formaldehyde mainly fluctuates slightly, and this week’s market has declined. As of April 6, the mainstream market value price in Shandong was 1130-1280 yuan/ton. This week, the price of raw material methanol fell weakly, and the market trading sentiment was average. Formaldehyde manufacturers showed a high willingness to maintain inventory and controllable shipments, resulting in a volatile market trend.

Upstream methanol situation: The domestic methanol market is fluctuating and declining, with the main focus on the consolidation of raw material coal market. The cost side lacks positive support, and the performance of spot gas buying is weak, resulting in a weak consolidation of methanol market. The factory quotation of enterprises in the central and eastern parts of Shandong is stable at 2480-2530 yuan/ton; The delivery price for Dongying and surrounding areas is around 2430 yuan/ton. The mainstream production of methanol in the southern Shandong market is around 2420 yuan/ton; The delivery price in Linyi area is around 2450-2470 yuan/ton.

Recently, the methanol market has been weak and declining, with poor cost support and weak demand from downstream sheet metal factories. Therefore, formaldehyde analysts from the Chemical Branch of the Business Society predict that the price of formaldehyde in Shandong will mainly fluctuate and decline in the near future.

1、 Price trend

According to data monitoring from Business News Agency, the domestic NMP market experienced a significant decline in March, exceeding expectations. At the beginning of the month, the average price of electronic grade NMP was 22500 yuan/ton, while at the end of the month, the average price was 18333 yuan/ton, a monthly decrease of 18.52%.

2、 Analysis and Review

As of March 31, the mainstream prices of NMP bulk water in different regions in China are as follows:

Region/ March 31st

East China region/ 16000-16500 yuan/ton

Central China region/ 15500-16000 yuan/ton

Southwest region/ 15500-16000 yuan/ton

In March, the domestic NMP market experienced a broad decline, making it difficult for downstream demand to increase. Enterprise inventory was high, and shipping pressure was high. It is understood that the lithium battery industry chain has been continuously “cold” since 2023. Due to various factors such as the slowdown in terminal demand for new energy vehicles, discounts and promotions for fuel vehicles, and the decline in international oil prices, the prices of lithium salts and related products have been declining, and NMP prices are no exception. There is a strong atmosphere of observation on the market, and NMP prices have been constantly falling in an atmosphere of buying up or not buying down.

The price of raw material BDO continued to decline in March. According to data monitoring by Business News Agency, from March 1st to 29th, the average price of domestic BDO dropped from 13816 yuan/ton to 10820 yuan/ton, with a 21.69% decrease in price during the cycle and a 60.32% year-on-year decrease in price. Downstream demand is not expected to improve, and the future market continues to be bearish. Raw materials are dragging down, further suppressing NMP prices.

3、 Future Market Forecast

According to NMP analysts from Business Society, the lithium battery industry may start to improve in April, and if demand is effectively followed up, NMP prices are expected to stop falling and stabilize.

In March, the butyl acetate market experienced a slight decline, with the trading center moving down by around 100 yuan compared to the previous month. According to monitoring by Business News, the monthly decline of butyl acetate was 1.52%. Although the cost side shows that the prices of acetic acid and n-butanol have rebounded to varying degrees, they are double suppressed by prominent supply pressure and relatively weak demand.

Market analysis: Most of the quotes from major manufacturers remained stable this month, and the operating rate of enterprises has not changed much compared to last month. Overall, it remains at 40-50%, but due to oversupply, enterprises are still in the process of accumulating inventory, and supply and demand remain in a weak balance. The price of raw material acetic acid rebounded, mainly due to the release of the shutdown news of Hebei Jiantao Plant, resulting in a decrease in acetic acid supply. In the latter half of the year, due to the weak market, acetic acid failed to continue its upward trend. The price of another raw material, n-butanol, has increased by 9.5% on a monthly basis. The cost of butyl ester is mixed, and the positive side of the cost has not driven the market for butyl ester. On the one hand, it is difficult to increase the transaction volume due to the fact that downstream suppliers often purchase on demand, and manufacturers often take and use as needed. Furthermore, export orders fell short of expectations, making it difficult to boost overall social demand.

Future forecast: It is expected that the butyl ester market will maintain a weak and volatile pattern in the short term. It is recommended to pay attention to the operation status of raw material acetic acid, n-butanol, and butyl acetate manufacturers. At present, the mainstream transaction price in the market is between 7200 to 7400 yuan/ton.

According to the data from the previous stock exchange, Shanghai Rubber continued to fluctuate slightly during the week of March 27th, fluctuating around 11850-11990 yuan/ton, with a relatively empty atmosphere. According to data from the Business News Agency, the spot market of natural rubber in China fluctuated slightly following the trend of futures. As of March 31, the domestic full latex market in East China was 11526 yuan/ton, a slight increase of 0.4% compared to 11480 yuan/ton on Monday, 27th.

Supply side

Arrival volume continues to increase: As of March 26, 2023, the total inventory of Tianjiao Bonded and General Trade in Qingdao was 628000 tons, an increase of 15000 tons compared to the previous period, with a month-on-month increase of 3.23%. China’s bonded port areas and social areas continue to accumulate stock of spot glue, and the market impact continues to be short.

New rubber production starts: Southeast Asia and Thailand are in the production reduction season. According to information from domestic production areas, at present, the phenological conditions in Hainan production area are normal, and the production of new rubber starts, but the amount is not large; Affected by powdery mildew in Yunnan, the cutting is delayed, which is initially expected to be delayed until mid next month to around May. Overall, at present, domestic new rubber has just begun to produce a small amount, which has no significant impact on the supply side. However, from the perspective of trading in the investment market, natural rubber continued to decline in February and March, coupled with long-term imbalances in supply and demand, and unfavorable market transactions. In addition, with the gradual increase in new rubber production, in the current economic environment and industry demand situation, the market trend of natural rubber may become more difficult in the future, with strong bearish sentiment.

Demand side

Year-on-year increase in operating rate: As of March 23, the operating rate of the all-steel tire production line was 73.29%, an increase of about 11 percentage points year-on-year; The operating rate of the semi steel tire production line was 79.21%, a year-on-year increase of 14 percentage points. Currently, under the premise of weak trends in natural rubber and carbon black procurement, downstream enterprises have downward expectations for future prices, and terminal orders are mostly placed in the form of on-demand procurement.

Tire Product Price Increase: It is reported that since March, due to the short-term increase in the prices of raw materials such as natural rubber and carbon black after the year, tire companies have generally chosen to increase the prices of tire products by specification and pace in order to absorb the phased cost pressure. Enterprises in Qingdao, Shandong Province said that their orders have improved since the first quarter; Some companies are also expected to start raising prices for certain tire products in the second quarter. The point recovery of demand, which extends to the entire industry, will have a more significant impact on the market.

Aftermarket Forecast

Regarding the future market, with the gradual increase in the production of natural rubber and new rubber next month, the pressure on the supply side will continue to increase. The pressure on the spot inventory of finished tire products at the downstream end continues to digest, and there are signs of a “point wise” improvement in demand expectations. It will take time for orders to fully improve. In summary, the natural rubber market in the second quarter is expected to be dominated by small fluctuations in the range, with the possibility of large fluctuations in the short term.