With Supply Tightening, the Vinyl Cyanide Market Halted Its Decline and Consolidated

Market Overview:

Market quotes remained generally stable throughout the week, with buying interest driven by immediate needs and the downward direction in prices temporarily easing. sector capacity utilization declined further, leading to continued supply contraction; meanwhile, persistent cost pressures and the gradual absorption of low-priced spot inventory—supported by buying to both export and low-level restocking—have alleviated sales pressure on suppliers and reduced stock levels, resulting in overall price stability. However, while the market appears to be hitting a temporary bottom, there remains insufficient momentum to a rebound.

Supply Side:

During the week, Jilin Petrochemical reduced its operating rate to 80%, and Zhejiang Petrochemical cut its unit load to 60%, resulting in a continued contraction in supply. Statistics show that the weekly capacity utilization rate of domestic vinyl cyanide vegetation to the week of June 5–11 was 66.67%, down 4.37 percentage points from the previous period; weekly output stood at approximately 77,800 tonnes, a decrease of 5,100 tonnes. Supply tightened further as vegetation in both the north and south lowered operating rates; meanwhile, buying interest picked up, leading to inventory declines at some companies. As of June 11, total inventory stood at approximately 46,000 tonnes, down 2,000 tonnes from the previous week.

Demand Side:

Last week, capacity utilization rates across key downstream industries showed mixed trends. Specifically, the utilization rate to ABS stood at 58.1% (down 0.9% week-on-week); to acrylic fiber companies, it was 74% (up 13.37% compared to the week before last); and to acrylamide, it was 53.28% (down 0.9% compared to the week before last). Overall, operating rates in the ABS and acrylamide sectors declined, and aggregate downstream demand remained weak.

Cost Side:

During the week, the price of the feedstock propylene fluctuated downward, while vinyl cyanide prices stabilized, leading to some improvement in the profitability of vinyl cyanide production. Statistics show that as of June 12, the market price of propylene in Shandong stood at 8,840–8,850 RMB/ton—a drop of 210 RMB/ton from the 9,050–9,060 RMB/ton recorded the week before last. The average production cost to vinyl cyanide was 11,156 RMB/ton (down 1.96% month-on-month), while the average production profit was -905 RMB/ton (an improvement of 54 RMB/ton month-on-month).

Market Outlook:

Overall downstream demand remains weak. While operating rates in the acrylic fiber sector have recently risen, operating rates in other downstream areas—such as ABS and acrylamide—continue to decline due to sluggish demand. Given the lackluster overall consumption, the market is primarily experiencing a temporary bottoming-out phase, with insufficient momentum to a rebound.