March is coming to an end, and the butanone market continues to fall. Most industry players were optimistic about the rise in butanone at the beginning of the month, but after a brief period of strength, the market continued to decline. Can the short-term trend of the butanone market stop the decline?
Market inventory is high, traders are under greater pressure
At the end of February and beginning of March, the market was optimistic about the rise of butanone, and factories and ship merchants actively stocked butanone. In addition, the export was positive, and the market was once strong. However, downstream demand throughout March was very sluggish, and second-tier traders continued to see resistance to their shipments. This is also a situation that most holders did not expect. Therefore, by the end of the month, sales were blocked, the market gradually weakened, and the weakness on the demand side was passed on to the supply side, leading to continuous downward adjustments in factory prices.
Downstream demand recovery is less than expected
Around the Spring Festival, the overall domestic chemical industry experienced a surge, leading to a gradual increase in the cost of terminal production plants, but consumer demand did not rebound sharply. Therefore, the increase in intermediate costs caused a decline in the profits of terminal manufacturers and discouraged production enthusiasm. However, in March, the butanone market weakened, and the "buy up but not buy down" mentality of the superimposed factories made the overall purchase confidence in the butanone market insufficient, and shipments were slow.
In addition, the trend of other related raw materials also has an impact on the production situation of the factory. Take ink printing, one of the main downstream applications of methyl ethyl ketone, as an example. Paper and pulp are the main raw materials of printing plants. The soaring prices of paper and pulp in the past two months have inhibited the enthusiasm of paper mills to start operations, which has also affected the demand for methyl ethyl ketone.
By the same token, downstream such as PU artificial leather, which uses more methyl ethyl ketone, will also consider cost factors such as plastics in the short term, and it is difficult to resume work in the short term.
Short-term butanone is difficult to change the downward trend
On the whole, the methyl ethyl ketone market remained deadlocked from the end of March to the beginning of April, and the factories in Hunan area started operating and the market supply increased. In the short term, methyl ethyl ketone may still maintain a downward trend.
Source: Mobile Public Account
