Ammonium persulfate

Market Dynamics Report on Ammonium Persulfate

I. Domestic Market Dynamics
1. Price Trends
- North China: Mainstream quotations remain stable at 7,200–7,500 RMB/ton. Some enterprises have slightly reduced prices by 50–100 RMB/ton due to inventory pressure.
- East China: Prices are maintained at 7,300–7,600 RMB/ton. Traders show stronger willingness to sell, and the scope for negotiation in actual transactions has widened.
- South China: Prices remain firm at 7,500–7,800 RMB/ton, supported by export orders, although new order transactions have slowed down.

2. Supply Situation
- Operating rate: The domestic operating rate is approximately 65%, remaining flat compared to the previous period. Some enterprises in Shandong and Jiangsu temporarily halted production due to environmental inspections, but overall supply remains sufficient.
- Inventory levels: Manufacturer inventory stands at about 12,000 tons, an 8% increase month-on-month. Trader inventory accumulation is significant, with some selling off goods at low prices.

3. Demand Changes
- Downstream industries: Demand for electronic-grade ammonium persulfate remains stable. However, due to the off-season, procurement volumes in the water treatment and papermaking industries have decreased by 15% month-on-month.
- Regional differences: Demand in northern regions is weak due to reduced winter construction activities, while demand in southern regions remains relatively stable, supported by export orders.

II. International Market Dynamics
1. Price Trends
- Southeast Asian market: CFR quotations are stable at 980–1,020 USD/ton. Demand in India is strong, but China’s export price advantage has weakened.
- European and American markets: FOB quotations are in the range of 1,050–1,100 USD/ton. Driven by rising energy costs, European manufacturers have a strong willingness to raise prices.

2. Trade Dynamics
- Chinese export volume: October exports decreased by 10% month-on-month, primarily due to a slowdown in purchasing pace by India and Southeast Asian countries.
- Import situation: Imports from Japan and South Korea have increased to supplement the domestic high-end market demand.

III. Cost and Profit Analysis
1. Raw Material Costs
- Ammonium sulfate prices: Stable at 1,200–1,300 RMB/ton, providing limited support to ammonium persulfate costs.
- Hydrogen peroxide prices: Due to oversupply, prices have fallen to 800–900 RMB/ton, alleviating cost pressures.

2. Production Profits
- Industry average gross margin: Approximately 15%, a decrease of 2 percentage points month-on-month, mainly due to falling prices while cost reductions have been limited.

IV. Analysis and Judgment
1. Short-term Factors
- Supply side: Domestic operating rates are stable, but inventory accumulation may trigger further price declines.
- Demand side: Downstream industries are entering the off-season, leading to weak demand, but the export market still provides support.
- Cost side: Weak raw material prices exert downward pressure on ammonium persulfate prices.

2. Medium-to-long Term Factors
- Environmental policies: Environmental inspections in northern regions may affect production at some enterprises, but the overall impact on supply will be limited.
- Export market: Demand in India and Southeast Asia may rebound due to seasonal factors, supporting prices.
- Substitutes: Prices of substitutes such as sodium persulfate and potassium persulfate remain stable, with minimal impact on the ammonium persulfate market.

V. Price Forecast
1. Short-term (1–2 weeks)
- Domestic prices: Prices in North and East China are expected to decline to 7,000–7,400 RMB/ton. Prices in South China, supported by exports, will remain at 7,500–7,700 RMB/ton.
- International prices: CFR quotations in Southeast Asia may drop to 950–1,000 USD/ton, while prices in Europe and the US will remain high due to cost support.

2. Medium-to-long term (1–3 months)
- Domestic prices: As downstream industry demand recovers, prices may rebound to 7,500–7,800 RMB/ton.
- International prices: With the recovery of the export market, prices may rise to 1,000–1,050 USD/ton.

VI. Risk Warnings
1. Tightening environmental policies may cause some enterprises to halt production, leading to supply shortages.
2. Significant fluctuations in raw material prices may affect production costs, which could then be transmitted to end-user prices.
3. International trade frictions may impact the export market, leading to a decline in demand.