1. overall market core pattern
this week china Isopropyl Alcohol the market completely reversed the logic of rising costs in the early stage, switching demand-led, weak downside trend, ranked among the top three weekly declines in China's chemicals, down 5.14 per cent in a single week. Upstream raw material trend differentiation, propylene due to geographical fluctuations and maintenance expectations first suppressed and then rose, strong bottom support, acetone low shock and supply continued to increase, raw material end firm can not hedge the downstream off-season negative, superimposed on the impact of export barriers, China's isopropanol industry chain supply and demand mismatch intensified, the market overall light.
Industry profits and start-up significantly weakened, acetone method, propylene method China isopropanol single ton loss of 600 yuan, 404 yuan, double process overall deep loss. Forced by losses, China's isopropanol industry operating rate from 66% in mid-July fell sharply to 51%, effective supply contraction, but the stock of goods continued to suppress market prices. As of July 31, Jiangsu China isopropanol spot 6550 yuan/ton, Guangdong 6900 yuan/ton, Shandong production area fell to 6400 yuan/ton, becoming a national price depression.
2. upstream and downstream core fundamentals dismantling
raw material end: support toughness still exists. China's propylene production fell slightly month-on-month, the plant inventory is at a low level, in August a number of sets of equipment centralized maintenance, follow-up supply tightening is expected to be strong, the price of deep space is limited. In terms of acetone, the pre-overhaul phenol ketone plant was restarted centrally, the industry started to rise to 66%-70%, Jiangyin port inventory increased to 15000 tons, and the increase in supply continued to suppress prices. At the same time, the price difference between acetone and isopropanol in China is only 325 yuan, which is far lower than the normal processing range, which is the core cause of the industry's losses.
Demand side: significant drag in off-season. China's mainstream solvents, coatings, cleaning industry into the July-August traditional off-season, terminal enterprises zero inventory on-demand procurement, no centralized replenishment action. The pharmaceutical sector just needs to be stable but the procurement cycle lengthens, no incremental contribution, only electronic-grade high-purity China isopropanol relying on the global AI chip industry to maintain structural improvement, but the market share is low, can not hedge the decline of industrial-grade demand.
Trade side: exports shrink sharply. India on July 16 to resume 7.5 percent import tariffs, superimposed on long-term anti-dumping barriers, China's core export channels of isopropanol to India blocked, June exports fell 57.53 percent month-on-month, overseas diversion pressure back to the domestic market, further exacerbating the contradiction between local supply and demand.
3. Industry Chain Profit and Regional Spread Characteristics
this week, the chemical industry chain showed a "two-end differentiation, middle collapse" pattern: upstream PDH, phenol ketone device general loss, midstream China isopropanol double process profit depth upside down, downstream plate rise and fall differentiation. Regional price difference, Shandong and East China China isopropanol price difference to maintain about 150 yuan, just to cover logistics costs, cross-regional arbitrage space completely closed, the regional market independent operation. Low inventory overlay industry production cuts, for China's isopropanol prices to build a solid bottom, unilateral plunge momentum dried up.
4. Outlook and Overseas Practical Suggestions
short-term market prediction: In the next 1-2 weeks, China's isopropyl alcohol will maintain a weak shock finishing, the core operating range of 6300-6700 yuan/ton. Raw material end has cost bottom, supply side production reduction negative, but off-season demand is weak, export pressure, the market is difficult to rise and fall, mainly to stabilize the weak.
Trade practical suggestions: Overseas buyers mainly buy small orders just needed, relying on low prices in the Chinese market to lock prices in batches to avoid the risk of falling prices; Traders can actively explore emerging markets in Southeast Asia to hedge against India's tariff gap. For a long time, we can focus on tracking the landing of China's installation and maintenance in August and the stock nodes in the peak season in September, and lay out the market reversal opportunities in advance.
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