Vinyl acetate

Recent Market Dynamics of Vinyl Acetate Monomer (VAM)

I. Price Dynamics
- Latest Quotations: As of July 7, 2026, Shandong Aite Chemical Co., Ltd. quoted RMB 7,900/ton (99.9% premium grade, tax-inclusive, delivery in Shandong Province); Shandong Junfeng New Materials Co., Ltd. and Shandong Beilu Hengsheng Chemical Co., Ltd. quoted RMB 6,000/ton (industrial grade, ≥99.9% purity, national standard premium grade, delivery in Shandong Province); Shandong Yeyang Chemical Co., Ltd. and Shandong Qiangsen Chemical Co., Ltd. quoted RMB 5,000/ton (≥99.9% purity, Grade I, delivery in Shandong Province); Qingdao Chengxin Hongfeng Chemical Co., Ltd. quoted RMB 5,400/ton (national standard, 99% purity, Ningxia Dadi brand, delivery in Qingdao City, Shandong Province); Shandong Hongyang Chemical Co., Ltd. quoted RMB 7,300/ton (domestically produced, delivery in Shandong Province); and Shandong Xima Supply Chain Management Co., Ltd. quoted RMB 5,200/ton (premium grade, 99.9% purity, delivery in Zibo City, Shandong Province).
- Price Trend: Since May 2026, VAM prices have experienced sharp volatility. In March, geopolitical tensions in the Middle East tightened supply-demand fundamentals, triggering upward price momentum. In April, export demand and planned plant maintenance drove the East China regional monthly average price to a peak of RMB 11,643/ton. However, prices plummeted in May, with the East China market’s mainstream average price falling to RMB 5,850/ton as of May 29—representing a monthly decline exceeding 35%.

II. Supply-Demand Dynamics
- Supply Side:
- Capacity Expansion: By end-2025, China’s total VAM production capacity reached 3.99 million tons/year, up 2.6% year-on-year; output stood at 2.858 million tons, up 13.4% year-on-year. Guangxi Huayi Energy Chemical Co., Ltd.’s new 300,000-ton/year VAM facility officially commenced operations in June 2026, increasing China’s total capacity from 3.89 million tons/year to 4.19 million tons/year.
- Operating Rates: Since May 2026, industry-wide operating rates have remained stable overall; however, the rapid ramp-up of newly commissioned capacity has significantly intensified market supply pressure.
- Demand Side:
- Downstream Consumption: Over 70% of VAM consumption is concentrated in EVA (ethylene-vinyl acetate copolymer) and PVA (polyvinyl alcohol). In the first half of 2026, slowdown in PV (photovoltaic) installation growth weakened EVA end-market demand, leading to reduced orders. Concurrently, soaring VAM prices pressured EVA producers’ margins, prompting multiple facilities to undergo unscheduled maintenance shutdowns. While new PVA capacity expansions are underway, near-term demand uplift remains modest and insufficient to offset EVA sector weakness and competitive pressure from new entrants.
- Export Performance: China exported approximately 180,000 tons of VAM in 2024, representing a ~9.8% year-on-year increase; exports were projected to reach 210,000 tons in 2025, a ~16.7% year-on-year growth. However, export demand remained sluggish in the first half of 2026, providing limited support to the domestic market.

III. Cost Dynamics
- Raw Material Prices: Ice acetic acid and ethylene constitute the primary raw materials for VAM production. Since May 2026, both key feedstock prices have declined markedly. In May, the Jiangsu provincial market price for ice acetic acid dropped from RMB 4,625/ton in April to RMB 2,790/ton—a 39.7% decline. Similarly, ethylene prices trended downward, with the Northeast Asia regional monthly average price down 17% year-on-year.

Analysis & Assessment

I. Reasons for Price Decline
- Supply-Demand Imbalance: Concentrated commissioning of new capacity coincided with sluggish downstream demand growth, substantially intensifying market supply pressure and driving persistent price erosion.
- Collapse of Cost Support: Sharp declines in ice acetic acid and ethylene prices eroded cost-based price floors, further amplifying downward pricing pressure.
- Market Sentiment: Prevailing bearish sentiment among market participants led to weak spot procurement and thin trading activity, exacerbating the downward price trend.

II. Industry Profitability Pressure
- Capacity Utilization: As prices continue declining, high-cost production units—including certain calcium carbide-based facilities—lose competitive advantages in sales, resulting in gradually declining industry-wide capacity utilization.
- Profit Margins: Although raw material prices remain low, VAM prices have fallen even more steeply, compressing profit margins across the industry and intensifying profitability pressures.

Outlook

I. Short-Term Outlook
- Price Trend: Near-term prices may face continued downward pressure. While falling prices will gradually reduce industry capacity utilization, the ongoing release of new capacity remains the dominant bearish factor. Coupled with underwhelming EVA demand recovery, muted traditional demand, and weak cost support, prices are expected to weaken further before stabilizing in a low-range consolidation phase.
- Supply-Demand Landscape: A dual-weakness scenario—characterized by subdued supply absorption and tepid demand—is intensifying; trading activity remains thin, and market participants maintain strongly bearish sentiment.

II. Medium-to-Long-Term Outlook
- Capacity Expansion: China’s VAM capacity is set to expand further over the next two years. New facilities by Guangxi Huayi Energy Chemical Co., Ltd. and Jiangsu Suopu New Materials Technology Co., Ltd. are scheduled to come online in 2027, pushing national total capacity to 4.62 million tons/year.
- Demand Growth: China’s VAM consumption is projected to rise only moderately—to 3.15 million tons by 2027—with an average annual growth rate of just 3.6%, significantly lagging behind capacity expansion. This growing mismatch between supply and demand growth will increasingly elevate oversupply risks.
- Price Trend: Medium-to-long-term prices will be primarily governed by supply-demand fundamentals. Structural overcapacity is unlikely to be fundamentally resolved in the foreseeable future, and VAM prices are expected to remain range-bound at relatively low levels.