According to the Commodity Market Analysis System of Shengyi Society, the price of formic acid has recently risen. As of March 9th, the benchmark price of 85% industrial grade formic acid in Shengyi Society was 2500 yuan/ton, an increase of 2.04% compared to the same period last week (March 2nd), a month on month increase of 2.46%, and a year-on-year decrease of 18%.

（1） Supply side: Maintenance expectations support, short-term supply temporarily stable
This week, the supply side of the formic acid market showed a characteristic of “expected tightening, actual stability”. In March, a total of 350000 tons of formic acid plants in domestic core production areas were scheduled for maintenance, which became a core variable supporting the market. As of March 9th, the maintenance plan has not yet been implemented on a large scale, the operating rate of enterprises remains at a normal level, and the market supply of goods is sufficient.
Meanwhile, around March 4th, due to the expected fluctuations in future sea freight rates, domestic enterprises concentrated on shipping export orders, effectively digesting the above median inventory in the early stage, alleviating potential pressure on the supply side, and laying the foundation for price stability.
（2） Demand side: Expected increase in peak season, weak terminal transactions
The demand side is showing a trend of “expectation and reality differentiation”. On the one hand, March and April are the traditional recovery period for downstream industries such as formic acid pesticides, leather, printing and dyeing. The start of spring plowing and stocking up, as well as the rise in temperature, will drive up downstream production rates, and there is a strong expectation of demand recovery; On the other hand, the actual transaction performance in the terminal market this week was weak, and the effect of manufacturers raising prices to guide procurement in the early stage was not good. The shipment of high priced goods was hindered, ultimately leading to the failure of price adjustment.
（3） Transaction and Inventory: Slowdown of Inventory Clearance Rhythm, Return to Rational Trading
This week’s inventory and transaction pace are changing synchronously. Before March 4th, centralized export shipments drove inventory digestion, and the market trading atmosphere slightly warmed up; But with the sluggish shipment of high priced goods, the pace of enterprise shipments has slowed down, inventory levels have returned to stability, and there has been no significant backlog or shortage. On March 9th, the market trading atmosphere returned to stability, the supply-demand balance was restored, and prices remained stable.
Market outlook: Significant increase in raw materials, expected to have a transmission impact on formic acid prices
Methanol: Over 60% of China’s imports come from Iran, and shipping in the Strait of Hormuz is obstructed, causing delays in the arrival of imported goods at the port; The domestic spring inspection efforts fell short of expectations, coupled with the resumption of downstream formaldehyde and dimethyl ether production, and tight supply and demand, driving prices to soar.
Sulfuric acid: The high dependence on imported raw material sulfur has led to a surge in sulfur prices due to supply disruptions in the Middle East; The maintenance of acid plants and the strong demand for spring plowing and fertilizer preparation have driven up the price of sulfuric acid due to the resonance between cost and supply and demand.
The formic acid data analyst from Shengyi Society believes that the price of formic acid has been stable recently, and a significant increase in raw materials may lead to an increase in formic acid prices. Specific changes in market supply and demand still need to be monitored.