According to the Commodity Market Analysis System of Shengyi Society, domestic formic acid has shown a stable but rising trend recently. As of February 9th, the benchmark price of 85% formic acid in Shengyi Society was 2440 yuan/ton, an increase of 3.83% compared to the same period last week (February 2nd) at 2350 yuan/ton, a month on month increase of 6.09%, and a year-on-year decrease of 17.29%.
Supply side: Maintenance and capacity load dominate, supported by inventory formation
The supply side is one of the core driving factors for the volatility of the formic acid market in this period. On the one hand, the maintenance of the equipment has led to a phased contraction in supply. The maintenance of a 100000 ton production capacity equipment in a factory in Liaocheng lasted through the first ten days, directly affecting the regional supply of goods; On the other hand, most manufacturers’ equipment is not operating at full capacity, coupled with some manufacturers’ periodic production cuts, resulting in a sustained tight supply of goods in the market, providing basic support for price increases. In addition, the impact of inventory factors is particularly crucial. At the end of January, manufacturers offered discounts on sales to take on a large number of orders, which led to a low median level of market inventory in the first half of the year, further highlighting the tight supply situation and becoming an important driving force for price increases. The reasonable buffering of industry inventory in the early stage also avoided the supply gap caused by maintenance, which led to significant price fluctuations.
On the demand side: domestic demand is weak, and export consolidation is forming a supplement
The demand side presents a differentiated pattern of “domestic weakness and export support”. In terms of the domestic market, the approaching Spring Festival holiday is the core influencing factor, and downstream industries such as rubber, medicine, leather, and pesticides are gradually entering the stage of stocking up. Purchasing attitudes tend to be cautious, with rigid demand as the main focus and weak stocking willingness, which has limited driving effect on formic acid prices; In terms of export markets, the arrival of the port consolidation period before the new year has become an important highlight on the demand side. The export shipment volume has increased compared to the previous period, effectively digesting some domestic sources of goods and providing certain support for prices.
The formic acid data analyst from Shengyi Society believes that, based on the current market pattern and the trends of supply and demand, it is expected that the domestic formic acid market will mainly operate at a stable price before the Spring Festival, with limited price fluctuations. Specific changes in supply and demand still need to be monitored.
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