Butyric Acid

Market Intelligence on n-Butyric Acid

I. Price Trends
1. Domestic Market:
- East China: The mainstream price of n-butyric acid is 8,500-9,000 RMB/ton, up by approximately 200 RMB/ton from last week, representing a 2.3% increase.
- South China: The mainstream price is 8,600-9,100 RMB/ton, up by approximately 150 RMB/ton from last week, representing a 1.7% increase.
- North China: The mainstream price is 8,400-8,900 RMB/ton, up by approximately 100 RMB/ton from last week, representing a 1.2% increase.
2. International Market:
- Asia: CFR China prices are 1,100-1,150 USD/ton, up by approximately 20 USD/ton from last week, representing a 1.8% increase.
- Europe: FOB Rotterdam prices are 1,050-1,100 EUR/ton, up by approximately 15 EUR/ton from last week, representing a 1.4% increase.
- North America: FOB Houston prices are 1,080-1,130 USD/ton, up by approximately 25 USD/ton from last week, representing a 2.3% increase.

II. Supply and Demand
1. Supply Side:
- The operating rate of domestic n-butyric acid production enterprises remains at 75%-80%, basically unchanged from last week, although production has slightly decreased due to equipment maintenance at some facilities.
- Import volumes have decreased by approximately 10% from last week due to rising international prices, with Southeast Asia being the main source of imports.
2. Demand Side:
- Downstream industry demand is growing steadily, with notable increases in demand from the coatings, plastic additives, and fragrance industries.
- Export demand remains stable, with main export destinations including India, Southeast Asia, and the Middle East.

III. Cost Factors
1. Raw Materials:
- The primary raw material for n-butyric acid is n-butyraldehyde. Recent continuous price increases in n-butyraldehyde have provided support for n-butyric acid costs.
- Regarding energy costs, fluctuations in crude oil prices have a limited impact on n-butyric acid production costs, but rising natural gas prices have increased production costs for some enterprises.
2. Transportation Costs:
- Domestic transportation costs remain stable, but international shipping costs have slightly increased due to higher fuel prices.

IV. Policy and Environmental Factors
1. Policy Impact:
- Domestic environmental protection policies continue to tighten, leading to the closure of some small enterprises that do not meet environmental standards, thereby further increasing market supply concentration.
- Adjustments to export tax rebate policies have a minor impact on n-butyric acid exports, but enterprises need to monitor subsequent policy changes.
2. Environmental Requirements:
- Downstream industries are increasingly demanding environmentally friendly n-butyric acid, driving enterprises to transition towards high-end products.

V. Analysis and Assessment
1. Short-term:
- Influenced by rising raw material prices and robust downstream demand, n-butyric acid prices are expected to continue their upward trend in the short term.
- Supply-side production declines due to equipment maintenance and environmental requirements will further intensify the tight market supply-demand situation.
2. Medium-term:
- As downstream industries enter their traditional peak season, n-butyric acid demand is expected to grow further, potentially pushing prices above the 9,000 RMB/ton threshold.
- Reduced import volumes and stable export demand will support domestic market prices.
3. Long-term:
- If n-butyraldehyde prices continue to rise, n-butyric acid production costs will increase further, potentially leading enterprises to transfer cost pressures through price hikes.
- Stricter environmental policies will drive industry consolidation, increasing market concentration and potentially reducing price volatility.

VI. Forecasts
1. Price Forecast:
- Over the next week, domestic n-butyric acid prices are expected to fluctuate between 8,600-9,200 RMB/ton, with East China prices potentially breaking through 9,000 RMB/ton first.
- International market prices are expected to fluctuate between 1,100-1,200 USD/ton, with Asian market price increases potentially outpacing those in Europe and the US.
2. Supply and Demand Forecast:
- Supply Side: The operating rate is expected to remain at 75%-80%, but production may slightly decrease due to equipment maintenance and environmental requirements.
- Demand Side: Downstream industry demand will continue to grow, particularly in the coatings and plastic additives sectors.
3. Risk Warnings:
- Significant fluctuations in the price of raw material n-butyraldehyde may impact n-butyric acid prices.
- Changes in international political and economic conditions may affect import and export trade, requiring close attention to relevant policy developments.