The epoxy chloropropane market showed a “V” trend in August, with an overall shift in focus compared to July. According to the monitoring and analysis system of Business Society, as of August 29th, the benchmark price of epichlorohydrin was 11600 yuan/ton, an increase of 1.75% from the beginning of the month.
Price influencing factors:
Raw material side: In the first half of the month, the price of raw material glycerol remained high and firm, while propylene showed slight fluctuations, which provided some support for the cost of epichlorohydrin. However, the support was limited, and epichlorohydrin fluctuated downward. In the second half of the month, the market prices of glycerol and propylene remained high, and there was significant pressure on production costs for enterprises. Most of them continued to raise prices in response to rising costs. According to the market analysis system of Shengyi Society, as of August 28th, the benchmark price of propylene in Shengyi Society was 6633.25 yuan/ton, an increase of 3.11% compared to the beginning of this month (6433.25 yuan/ton).
Supply side: In early August, new production capacity was released and some equipment maintenance was completed in Shandong region, and market supply expectations showed an increasing trend. The supply side showed a relaxed state, and the support for epoxy chloropropane supply side was insufficient, causing the price center to shift downward. In late August, some facilities in Zhejiang and other regions underwent maintenance, resulting in a tight supply of spot goods in the market. Despite the release of new production capacity and an increase in some spot sales in the Shandong region, the overall tight supply situation has not fully eased, and the market price of epichlorohydrin has hit the bottom and rebounded.
On the demand side, the downstream epoxy resin industry had a production capacity utilization rate of about 50% in August. Downstream enterprises mainly focus on essential procurement, with an average trading atmosphere and few live ammunition. In late August, as the price of epichlorohydrin hit rock bottom, some companies had urgent small orders to fulfill their previous contracts. But as the price of epichlorohydrin rises to a high level, downstream acceptance of high prices is weak, resulting in poor shipments for enterprises. Currently, high-level transactions are not smooth, and the trading atmosphere is relatively average. It is expected that the market price of epichlorohydrin will remain stable in the later stage.
Market forecast: Analysts from Shengyi Society believe that the high and firm prices of glycerol and propylene on the cost side have not completely eased the tight supply situation. Overall, the raw material and supply sides provide some support for the epichlorohydrin market. However, downstream demand is weak and the trading atmosphere is not smooth, which may limit the continuous price increase. It is expected that the epoxy chloropropane market price will remain stable in the later stage, and more attention still needs to be paid to changes in raw material prices and market supply and demand.