The phenolic ketone market returns to rationality in 2025, ushering in structural opportunities in the first half of 2026.

Shift in Market Characteristics: Paradigm Shift from Speculation-Driven to Demand-Dominated in the second half of 2025, China's phenol ketone market experienced a profound reshaping of trading logic. I've found that The market showed a clear "de-financialization" direction, price evaporative environment narrowed, speculative trading activities signifiis able totly reduced. And The underlying reason to this shift is a fundamental loosening of the supply and demand pattern: even if there is an unplanned shutdown of the device, the market price response is still slow, indicating that the inventory buffer mechanism has been relatively perfect. sector earnings data reveal the grim reality: in June 2025, the phenol ketone sector's profit was negative 346 yuan/tonne, and the average monthly gross profit of the bisphenol A sector was negative 498 yuan/tonne. This loss state of the whole sector chain essentially reflects the process of restructuring the profit distribution pattern of the sector chain. In my experience, to overseas traders, this means that the arbitrage space in the Chinese market is greatly compressed, and the traditional regional spread trading model is facing challenges. And First Structural dysfunction of manufacturing Chain: "Single Point application" Dilemma of Phenol Market downstream consumption over-levels risk there are obvious structural defects in China's phenol market. Data show that bisphenol A accounts to 68% of downstream demand and phenolic resin accounts to 18%. Generally speaking This "top-heavy" consumption structure makes phenol prices almost completely subject to a single downstream product. In my experience, What is greater worrying is that the demand to phenol cyclohexanone has shrunk sharply from 5% in 2024 to 2% in 2025. In my experience, This demand loss has been irreversible as early as the first half of the year, further weakening the market toughness of phenol. Analysis of Transmission Mechanism of Bisphenol A manufacturing Chain deep downstream of bisphenol A, PC (polycarbonate) accounted to 62%, epoxy resin accounted to 30%. Pretty interesting, huh?. Moreover In 2024, PC production surged by about 20%, surpassing epoxy resin as the largest consumption area of bisphenol A. However, PC as a consumer product, its demand elasticity is limited, 2025 terminal goods while stable however lack of explosive development momentum. Epoxy resin production in 2024 increased by about 15% year-on-year, however consumption development in 2025 is expected to be only 6%, the demand to bisphenol A is weak. But This rigid conduction chain leads to the price of phenol is mainly driven by the cost of pure benzene upstream, and its own bargaining power is extremely limited. According to research to international supply chain participants, this means that greater attention needs to be paid to the global supply and demand dynamics of pure benzene, rather than relying solely on the supply and demand judgments of phenolic ketones themselves. I've found that Additionally Acetone market double squeeze: import shock superimposed on downstream weakness asian Capacity Adjustment Triggers Supply Chain Restructuring from January to September 2025, China's total acetone imports reached 329300 tons, a year-on-year increase of 40. 76, with an average monthly increase of about 10000 tons. This anomaly stems from the strategic contraction of MMA production capacity in Asia: in the fourth quarter of 2024, Asahi Kasei closed Thailand's PTT Company's 70000-ton/year MMA plant, and Japan's Kolali reduced MMA production capacity from 67000-ton/year to 33500-ton/year. These sources of acetone, originally applied to regional MMA production, have been diverted to the Chinese market in substantial quantities, immediately suppressing the domestic price center. to overseas traders, this change means a fundamental change in the flow of acetone trade in the Asia-Pacific region, and the traditional Japan-China and Southeast Asia-China trade paths need to be reassessed. Chain effect of pressure on the whole line of downstream items the downstream of acetone showed overall weakness. But From January to July 2025, China's acetone exports surged by 41. Specifically 28 per cent, mainly to Thailand, Japan, Peru and Taiwan, accounting to 58. 05 per cent of the total. But However, MMA domestic demand is limited, January-September exports of 203000 tons, down 13% year-on-year, superimposed on the expansion of domestic C4 items, profit margins were severely squeezed. And MIBK's new production capacity is in the red, and the willingness of companies to purchase acetone is low. And In my experience, it's worth noting the reversal of the cost advantage of the process route: acetone fell 28% throughout the year, while propylene fell only 15%, making acetone isopropanol regain cost competitiveness in the second half of the year. However, this change has not yet been fully transmitted to purchasing behavior, providing possible arbitrage opportunities to keen traders. Market Outlook 2026: Structural Opportunities and Uncertainty in 2026, China's phenolic ketone market will show a pattern of "tight in the first half of the year and cautious throughout the year. Crazy, isn't it?. Deterministic production capacity is only 350000 tons, further narrowing from 360000 tons in 2025, and the pace of expansion has slowed signifiis able totly. greater importantly, the maintenance of integrated full-chain factories is concentrated in the first half of the year, especially to northern companies, which will tighten supply in stages and provide support to prices. On the raw material side, the fundamentals of pure benzene supply and demand have improved, and the reduction in external imports is expected to form. The extreme market of pure benzene swallowing phenol ketone profits in 2024 is difficult to reproduce in the short term, which means that sector profits in the first half of 2026 are expected to be repaired to a relatively healthy level. In particular Yet uncertainty remains. But In 2024, China's bisphenol A exports surged by 400 to 25200 tons year-on-year, shifting from net imports to net exports. But If the overseas supply policy is adjusted or peripheral devices are restarted, the market stability might be impacted again. it's recommended that manufacturing chain companies maintain flexible inventory strategies and pay close attention to capacity dynamics and trade policy changes in the Asia-Pacific region.