After experiencing a continuous decline in the first quarter, the adipic acid market stopped falling and rebounded in April. In May, the market continued to rise. According to the Commodity Market Analysis System of Shengyi Society, as of May 31, the monthly increase in adipic acid was 2.61%, and the market trading center has significantly shifted upwards. By the end of the month, the market price range for adipic acid was between 9650 and 9850 yuan/ton, an increase of about 200 yuan compared to the beginning of the previous month. The main reason is the positive cost boost and the relief of supply pressure.
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Industrial chain
The above chart shows that the adipic acid industry chain has significantly improved this month, with a focus on growth, especially in upstream products such as pure benzene and cyclohexanone. Adipic acid is often driven up by costs. Downstream demand is sluggish, and product trends have not changed significantly. PA66 operates in a stalemate. Maintain in a relatively weak range.
Cost side: Both pure benzene and cyclohexanone have increased
According to the Commodity Market Analysis System of Business Society, the price of pure benzene has increased this month, with a growth rate of 5.23%. Since the beginning of the month, the price of pure benzene has been rising, and the market has seen a significant increase in the latter half of the month. As the end of the month approaches, the price of pure benzene in East China ranges from 9000 to 9100 yuan/ton. The price of cyclohexanone has also risen this month, with an increase of 2.52%. Overall, the cost side is mostly favorable.
Supply side: Temporary maintenance of equipment, supply pressure relief
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From the perspective of market supply: In terms of equipment, the overall operating rate of adipic acid continued to decline in the first half of this month, dropping to below 40%. Except for the devices that entered the maintenance period last month, some devices this month were temporarily inspected and cleaned, resulting in production damage and a slight decrease in supply. The supply side has transitioned from loose to tight. There are still many devices under maintenance in June, and it is expected that the production will still be mainly low.
Demand side: Downstream demand remains mainly sluggish
Adipic acid downstream still shows lukewarm and lukewarm behavior. The caprolactam and TPU industries are still performing poorly. Downstream factories are cautious in picking up goods, and there has been no improvement in orders to ensure normal start-up demand. Taking PA66 as an example, according to the monitoring of Business Society, the decline of PA66 this month was 6.94%. The market is hovering at the bottom. At the end of the month, the market price of PA66 in Zhejiang Province was around 21500-22000 yuan/ton. At present, weak demand is the fundamental reason why adipic acid has not been able to continue its upward trend.
Future prospects
Business Society Adipic Acid Analyst believes that on the cost side, there is a high probability of high volatility in crude oil in the future, which will bring cost advantages to downstream chemical products. The prices of pure benzene and cyclohexanone continue to rise, and there is currently no stopping trend in prices. Adipic acid still has an advantage in terms of future cost. From the perspective of supply and demand, both supply and demand will be weak in the future, and the supply side will maintain low operating rates. Manufacturers generally lower operating rates to stabilize the profit range of adipic acid prices. The sluggish demand side will continue, and overall, there is still room for further increase in adipic acid, but the increase should be somewhat compressed.
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