The price of Propylene Glycol increased in China during the holiday-shortened month of January, primarily in anticipation of growing demands following the Lunar New Year because both consumption and production increased when the government abandoned its zero-COVID policy. With its official Purchasing Managers' Index (PMI) passing the expansionary zone of over 50, i.e., 50.1, China's manufacturing sector returned to life in January, signaling well for a rebound in the world's second-largest economy.

The price of Propylene Glycol in China was generally stable at the start of 2023, with a slight increase due to a lack of supply. Several manufacturers in Shandong supplied Propylene Glycol to their solid and long-term clients. The downstream demand side displayed moderate performance, largely stabilizing pre-holiday goods preparation.

Undoubtedly, the increased supply pressure has been the biggest shift from the pre-holiday period. It is usual to anticipate a stock buildup over the holiday season, and it did happen. However, supply restrictions from international markets during the region's season of regular maintenance have put prices on the rise, especially with China's enhanced economic activity due to the country's complete reopening.

As the Chinese markets were closed for the Lunar New Year vacation from January 21 to January 27, the domestic logistics were shut down sequentially, and the delivery of Propylene Glycol from factories was stopped. After returning from vacation, the Propylene Glycol market is steadily rising. Beginning in February, there was a moderate demand for Propylene Glycol from the end-user pharmaceutical, food, and cosmetic industries, but a limited supply was available locally. Thus, the price of Propylene Glycol then increased gradually during the week ending on February 10.

ChemAnalyst predicts that the Propylene Glycol market in China will mostly experience a slight price increase in the following week since the downstream companies are taking a wait-and-see approach. The demand may not truly rebound until Q2 of 2023. Even with limited supply, demand will not be that supportive.