On April 27th, the price of isooctanol was 8933.33 yuan/ton, which fluctuated and fell by 3.60% compared to 9233.33 yuan/ton at the beginning of this month. The cumulative increase from 6700 yuan/ton at the beginning of March still reached 36.32%, and it is in the warning range of over inflation within one year. In April, the isooctanol market showed an overall pattern of “high volatility, first strong and then weak”. At the beginning of the month, it continued to rise strongly to the peak of the year in March, and then gradually retreated due to the impact of cost decline and supply-demand stalemate. The price fluctuated around the range of 9000-9500 yuan/ton throughout the month, and remained at the high level of the year as a whole. The core was dominated by the linkage between crude oil and propylene and changes in the supply and demand pattern. At the same time, starting from mid April, the average price of Shengyi Society moved downward, and the isooctanol market showed a clear downward trend.
Cost side: crude oil+propylene linkage, support first strong and then weak
4.1-4.7: The futures price of propylene is running at a high level. On April 7th, the main closing price of propylene reached 9447 yuan/ton. Coupled with the support of geopolitical factors in the previous crude oil price, the strong cost support of isooctanol pushed the price higher. With the implementation of the US Iran ceasefire agreement, crude oil prices plummeted and propylene prices simultaneously retreated. On April 27th, the main closing price of propylene dropped to 8360 yuan/ton, a decrease of 11.51% from April 7th. The cost support for isooctanol weakened, and prices were under pressure and retreated. In addition, the propylene to isooctanol ratio index remained high, further increasing the downward pressure on isooctanol.
Isooctanol supply and demand are both weak
In April, isooctanol enterprises continued to operate at a high level, and the operating load of isooctanol enterprises decreased. At the end of the month, the operating rate dropped to about 80%, and the supply of isooctanol decreased. Downstream procurement is mainly based on essential needs. In April, the operating rate of plasticizer enterprises decreased, and the operating load of DOP decreased from 66% in March to 55% in April, resulting in a decrease in operating capacity. The demand for isooctanol by plasticizers decreased, and the upward momentum of isooctanol weakened. The supply and demand of isooctanol are both weak.
Future prospects
On the cost side, crude oil prices are unlikely to rebound significantly due to the impact of the US Iran ceasefire, propylene prices are likely to remain volatile, and the cost support for isooctanol continues to weaken; On the supply and demand side, the production of isooctanol and plasticizer enterprises has both decreased, and the supply and demand are weak, making it difficult to support price increases. Overall, with cost reduction and weak supply and demand, it is expected that the price of isooctanol will fluctuate slightly in the future.
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