Raw Material Costs Rose While Finished Product Prices Fell—Melamine Caught in a Tug-of-War Between Bulls and Bears

Upstream and Downstream Cost Hedge Analysis

On the feedstock side, urea prices have bucked the broader direction; as of June 23, the benchmark price stood at 1,838.75 RMB/ton—a 1.03% increase from the 1,820 RMB/ton recorded in early June. While this slight rise in raw material costs provides a floor to melamine prices, demand from downstream sectors—such as wood-based panels and impregnated paper—remains in a traditional off-season slump. With insufficient essential procurement at the end-user level and persistent pressure on manufacturers to move inventory, cost support has failed to translate into upward price momentum; consequently, the market remains locked in a stalemate at low price levels amidst the tug-of-war between bullish and bearish forces.

Market outlook

Recently, melamine spot prices have edged down, weighed down by the off-season to demand, though cost support has emerged from a slight rise in the price of the raw material, urea. With bullish and bearish forces relatively balanced, significant market fluctuations are unlikely in the short term, and a wait-and-see stalemate prevails.