Glacial Acetic Acid Industry Weekly Report

China Glacial Acetic Acid Weekly Market Analysis

This week, Glacial Acetic Acid prices saw a slight rebound in some areas. At the beginning of the week, enterprise inventories continued to decline, and in East China, the restart of plants fell short of expectations, resulting in low capacity utilization rates throughout the week.

Around mid-week, factory shipments generally improved. Downstream users were mainly fulfilling contracts and long-term agreements, leading to moderate sales for traders. However, with factories slightly raising prices, market sentiment improved slightly, and prices in some local markets gradually increased.

Supply Analysis

This week, the recovery of previously shut-down glacial acetic acid plants fell short of expectations. Thorpe restarted and increased its operating rate, while Shunda operated at a reduced rate. Anhui Huayi, INEOS, and Guangxi Huayi continued their maintenance shutdowns, resulting in a continued decline in operating rates. Glacial acetic acid production this week was 218,700 tons, a decrease of 8,100 tons from last week, with a capacity utilization rate of 67.13%.

Main Downstream Capacity Utilization Rates

The capacity utilization rates of major downstream glacial acetic acid producers showed mixed trends this week. During the week, some PTA plants adjusted their operating rates, leading to a re-optimization of the supply side. As a result, the overall domestic PTA capacity utilization rate declined week-on-week.

Ethyl acetate Jiangsu Suopu plant operated normally, Qianxin Jingmen plant adjusted its operating rate, and Guangxi Jinyuan and Ningxia Ruiyuan plants were shut down. The losses from plant shutdowns exceeded the recoveries, hence the decline in ethyl acetate capacity utilization this week. Butyl acetate: Yankuang Lunan and Zhuhai Qianxin plants resumed normal operation, Jiangsu Baichuan plant experienced a short shutdown, and Lier'an plant was shut down. Butyl acetate capacity utilization increased significantly this week. Vinyl acetate: Shenghong restarted, leading to a rise in capacity utilization.

Butyl Acetate

Butyl acetate prices fell this week. In East China, the lowest price was 4925 yuan/ton (cash only, ex-factory), and the highest was 4975 yuan/ton (cash only, ex-factory). The weekly average was 4935 yuan/ton, a decrease of 98 yuan/ton from the previous week, a drop of 1.95 percentage points.

The butyl acetate market generally trended weakly this week, with supply-side pressure becoming prominent. Previously shut-down plants restarted, and all factories reported stable operating rates, leading to a significant increase in spot market circulation and a continued loose supply situation. However, the continued weakness in the price of raw material n-butanol negatively impacted the market. Downstream buyers maintained a "buy high, sell low" mentality throughout the week, resulting in insufficient willingness to purchase. After a period of restocking, many traders withdrew from the market to deplete their existing inventory, and new orders were weak, leading to generally sluggish sales for manufacturers.

Towards the end of the week, although cost support remained weak, manufacturers had limited willingness to further reduce prices significantly due to prices being close to factory cost lines. Most opted for stable offers, which to some extent mitigated the downward trend in the market.

Looking ahead to next week, both supply and demand remain weak. Although current prices are finding slight support near the cost line, without substantial improvement in demand and continued weakness in raw material prices, Longzhong believes the butyl acetate market will maintain a weak and volatile pattern in the short term, with the possibility of further declines.

Next Week's Market Outlook

The glacial acetic acid market is expected to see increased supply and decreased demand next week. However, due to relatively low overall inventory pressure and a large number of pending orders, Longzhong Information predicts that market prices may remain firm next week.

Key Focus Areas:

1. Supply Side: Next week, the Thorpe plant is expected to resume normal operation, Anhui Huayi and INEOS are expected to restart, and Yanchang has maintenance plans, leading to a rise in capacity utilization.

2. Demand Side: A PTA plant in East China has maintenance plans, while other plants remain stable, resulting in a slight decrease in overall output next week. Ethyl acetate: Anhui Huayi's ethyl acetate plant will resume operation next week, increasing ethyl acetate operating rates. Butyl acetate: Qianxin Jingmen has shutdown plans next week, leading to a decrease in butyl acetate operating rates. Vinyl acetate: Overall fluctuations are not expected to be significant.

3. Methanol Costs: Based on theoretical calculations of upstream and downstream plant start-up and shutdown, overall supply and demand data are expected to show a positive expansion. The methanol market in the next period is expected to see increased supply pressure, with more plants scheduled to resume operations and fewer plants scheduled for maintenance or production cuts. Demand is expected to recover slightly, but the overall oversupply situation will negatively impact methanol prices. The port spot price of methanol is expected to fall to 2050-2070 yuan/ton next week.