Propionic acid

Propionic Acid Market Intelligence, Analysis, and Forecast — Recent Commodity Market Dynamics

I. Market Intelligence

Price Trends
- Benchmark Price: According to Shengyishe data, the benchmark price of propionic acid on July 7, 2026, stood at RMB 5,671.43 per metric ton, down 0.25% from the beginning-of-month level (RMB 5,685.71/ton on July 1), and currently resides at a mid-to-lower level within the annual price range. Over the past year, the highest recorded price was RMB 6,733.33/ton, the lowest was RMB 4,977.50/ton, the median was RMB 5,855.42/ton, and the average was RMB 5,789.12/ton.
- Enterprise Quotations: Significant inter-company quotation disparities persist. On July 5, 2026, Shandong Hanyue Chemical Co., Ltd. quoted RMB 6,300/ton for domestically produced propionic acid (99.9%, premium grade); Qingdao Shengze Chemical Co., Ltd. quoted RMB 4,600/ton for Luhua Chemical’s propionic acid. On July 3, Shandong Zhihengda Import & Export Co., Ltd. quoted RMB 7,200/ton for domestically produced propionic acid (99.5% purity), while Shandong Jinshengrun Chemical Co., Ltd. quoted RMB 5,000/ton.

Supply-Demand Situation
- Imports: From January to April 2026, China’s propionic acid imports totaled 0.73 tons, up 16.77% year-on-year; import value amounted to USD 14,700, surging 93.51% year-on-year. Import dependency has been virtually eliminated, and the industry has entered a “net export” phase.
- Exports: During the same period, China’s propionic acid exports reached 12,200 metric tons, down 5.81% year-on-year; export value totaled USD 8.9052 million, declining 26.99% year-on-year—indicating ongoing pricing pressure.
- Production Capacity: Upon completion of its Phase II project, Luxi Chemical Group’s total propionic acid capacity reached 190,000 tons/year, surpassing YZB (Yangzi Petrochemical–BASF) to become China’s largest supplier—triggering a phase of temporary oversupply.

Industry Policy
On July 19, 2024, China’s Ministry of Commerce issued the “Final Determination Announcement on the Anti-Dumping Investigation of Imported Propionic Acid Originating in the United States,” concluding that dumped imports originating in the U.S. have caused material injury to China’s domestic propionic acid industry, and that a causal relationship exists between such dumping and the injury sustained. This policy has effectively curbed market disruption from low-priced imported products, creating favorable development space for domestic propionic acid producers.

II. Analysis and Assessment

Causes of Recent Price Volatility
Recent propionic acid price fluctuations are primarily driven by short-term cost pressures and supply-demand imbalances. In late February, the temporary Strait blockade incident involving Iran triggered a spike in international oil prices, lifting upstream costs across the chemical sector—including propionic acid production—and providing short-term cost support. However, this supportive effect has now weakened, and the market has reverted to a weak adjustment pattern. Meanwhile, Luxi Chemical’s capacity expansion has contributed significantly to the current phase of supply surplus, further weighing on prices.

Evolving Competitive Landscape
The global propionic acid industry features relatively high technological barriers, with major production capacities concentrated in the United States, Western Europe, and China. As domestic players—including Luxi Chemical—continue expanding capacity, China’s self-sufficiency rate in propionic acid has risen markedly, eliminating import dependency and substantially strengthening domestic industry bargaining power. Competition is shifting away from pure scale rivalry toward a dual-track strategy centered on “cost control + product differentiation”: first, leveraging integrated advantages in coal and salt chemical industries to reduce production costs; second, extending into high-value-added derivatives—such as pharmaceutical-grade and food-grade propionic acid—to avoid commoditized, low-end competition.

Market Trends
With rising domestic self-sufficiency, import substitution has essentially been completed; exports will thus become a critical channel for absorbing excess capacity. However, enterprises must remain vigilant against escalating international trade barriers. Optimizing export structures and actively penetrating emerging markets—including Southeast Asia and the Middle East—is essential to transition from a “low-price, high-volume” model to one emphasizing “quality-driven competitiveness.” Furthermore, the research, development, and application of green, low-carbon technologies—such as bio-based fermentation-derived propionic acid—offer new technical pathways for sustainable industry development and may ultimately disrupt conventional petrochemical production paradigms.

III. Forecast

Price Forecast
In the short term, propionic acid prices are likely to continue fluctuating within a weak adjustment pattern. With waning cost support and persistent supply surplus, upward price momentum remains limited. However, in the long run, prices are expected to gradually stabilize and recover, underpinned by optimized production costs and product upgrading—especially through higher-value applications.

Supply-Demand Forecast
Domestic propionic acid capacity is projected to expand further over the near term, prolonging the supply surplus situation. On the export front, stable growth in export volumes is anticipated as enterprises diversify into emerging markets and refine their export portfolios. Regarding imports, volumes are expected to remain low due to the continued effectiveness of anti-dumping measures.

Industry Development Trend Forecast
China’s propionic acid industry is undergoing a three-stage evolution—from “foreign technology dependence” to “domestic scale leadership,” and ultimately toward “end-to-end, fully autonomous industrial control.” Future competitive advantage will hinge upon three core capabilities: speed of technological iteration, pace of green and low-carbon transformation, and level of global operational sophistication. Enterprises will intensify R&D investment in green, low-carbon technologies—including bio-based fermentation propionic acid—to advance sustainable development. Concurrently, industry concentration will rise further, as leading firms pursue mergers, acquisitions, and strategic alliances to expand market share and enhance overall industry competitiveness.