1、 Market trend

Under the influence of the macro situation, since March 1st, the overall price of butanone in China has shown a rapid upward trend in a stepped manner, rising from 7000 yuan/ton at the beginning of the month to 8300 yuan/ton, reaching a high point in the first quarter, with a cumulative increase of 18.57% within 5 days.
2、 Core influencing factors
Macro situation: Geopolitical conflicts dominate the cost side
On February 28th, Iran announced the closure of the Strait of Hormuz, which carries about 20% of global crude oil and 30% of liquefied natural gas trade. The closure directly led to a significant increase in Brent crude oil prices, which transmitted the cost of crude oil to the entire chemical industry chain. As an upstream raw material for butanone, the soaring price of crude oil directly pushed up the production cost of butanone.
Supply side: Some butanone enterprises have undergone equipment maintenance or reduced production, resulting in tight spot supply in the market. Leading enterprises have successively raised their butanone prices, driving up industry prices.
On the demand side: The traditional peak season of “gold, silver, and four” combined with downstream industries such as coatings and adhesives resuming work and production, the domestic macroeconomic recovery, and the gradual release of demand for butanone replenishment have provided demand side support for the rise in butanone product prices.
3、 Future prospects
In the short term, against the backdrop of ongoing geopolitical conflicts and high crude oil prices, the price of butanone is expected to remain at a high level, and there is even a possibility of further surge. In the long run, if geopolitical conflicts ease, crude oil prices fall, or downstream demand falls short of expectations, the price of butanone may face the risk of correction.