Poor demand, further decline in POM prices

Price trend


Gamma Polyglutamic Acid

Last week, the domestic POM market was negative, with a significant drop in spot prices. According to the Commodity Market Analysis System of Business Society, as of May 22, the average factory price of domestic POM was 12950.00 yuan/ton, a 2.63% decrease from the price level at the beginning of the month.


Cause analysis


In terms of raw materials:


Recently, the price of formaldehyde market in Shandong has fluctuated and dropped. It can be seen from the above figure that the recent market of formaldehyde mainly fluctuates slightly, and the market fell last week. The price of raw material methanol fluctuated slightly, with moderate support for formaldehyde. Downstream panel factories started smoothly, with moderate demand support on the market. Market trading sentiment was poor, and the formaldehyde market declined.


On the supply side:


Gamma Polyglutamic acid Cosmetic

The high operating rate of domestic POM enterprises has decreased, with some enterprises undergoing maintenance in the early stage, and the industry load has decreased to about 79%. The situation of high load has eased narrowly, but most enterprises’ inventory has not decreased but increased, and processing profits have gradually decreased.


In terms of demand:


At present, POM terminal enterprises have weak stocking enthusiasm, low operating rates, poor consumption release, and limited impact on spot prices. Traders lack confidence and are forced to lower prices to complete tasks. Buyers tend to buy up rather than down, with a wait-and-see mentality. The actual order is light and tends towards a single negotiation.


Future Market Forecast


Last week, the POM market fell again. The operating rate of domestic polymerization plants is still acceptable, but there are multiple companies resuming work in the later stage, with expectations of rising supply. In addition, the industry’s inventory pressure continues to increase, and suppliers are unable to support spot goods. The demand side enterprises just need to replenish less, and some downstream operating rates are low, resulting in few actual transactions. Based on various bearish and bearish factors, it is predicted that the POM market may continue to decline in the short term.


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