Formaldehyde: It's hard to get off season

HC Chemical Network News: Looking at the market conditions of formaldehyde, gold, nine silver and ten markets have not come as expected. This year, the formaldehyde market has spent its traditional peak season in awkward conditions. The raw material methanol remains high and the downstream demand is weak. The formaldehyde market can only “much more than justify the injustice”.

As can be seen from the chart, last year's "Jin 9 Silver 10" market did not appear, but after the National Day with the help of high raw material methanol prices, there has been a straight up trend. However, this year's formaldehyde market did not show a significant increase in market conditions. The volatility is limited and it is difficult to surpass the high point last year. The formaldehyde market has been prosperous in the busy season and has been lighter in the off-season. The reasons for this are as follows:

First of all, the downstream demand for formaldehyde continues to be weak, especially as the main downstream sheet adhesives for formaldehyde currently have low demand. Affected by economic expansion and other factors, the difficulty of financing has increased, and the survival of small and medium-sized enterprises is facing crisis. Therefore, it is difficult for the capital turnover to proceed smoothly. Most sheet metal factories have suffered heavy losses for small and medium-sized enterprises. In addition, the preferential policies for sheet metal have been eliminated, the cost has increased, and the lack of timber in some areas has made it difficult to raise the plate plant. Demand for formaldehyde has limited ability to expand, and high costs are difficult to withstand demand. With the increase, most of the formaldehyde manufacturers choose small profits and quick turnover, and the prices have not risen significantly.

Secondly, this year, the formaldehyde manufacturers are blindly following the increase, the demand continues to be weak, the market is in a state of priceless market, and under the premise of stable shipments, the frequency of price adjustment by the formaldehyde manufacturers is reduced. At the same time, the demand has been followed up and the inventory is high. Some manufacturers adjust the load of the equipment at any time to avoid the crisis of expansion. Compared with the same period last year, the number of price adjustments by formaldehyde manufacturers decreased and the blindness weakened. The market's overall shipment rhythm is relatively moderate and the peak season does not appear.

Again, the current price of raw material methanol has not yet reached the highest level, which is a weak boost for the formaldehyde market. After the repair of the Northwest China's equipment, the reduction of supply of goods, and the impact of higher coal prices, methanol still has room for growth. At that time, formaldehyde may continue to rise passively. At present, the transaction volume of real estate has shrunk. It is difficult to support the demand for formaldehyde by building an affordable housing alone.

Zhuo Chuang analyzes that the “culprit” that did not appear in the peak season of the formaldehyde market this year is demand. The whole market is in a state of chaos and comes down to one: the demand does not force, and the downstream downstream of formaldehyde is causing troubles.