n-Butanol Prices Bounce Back in China After Prolonged Dullness

The Chinese n-Butanol market experienced a noticeable rebound in November, which was compelled by a mild trading atmosphere. The healthy demand for n-Butanol from the downstream industries impacted the prices of the product as they brought some confidence to the market. Henceforth, after witnessing a continuous decline in October 2023 by the utmost 13.4%, the n-Butanol market has steadily recovered amid phased restocking, which brought prosperity and positive support amongst traders and consumers during this timeframe.

The endless declining trend of n-Butanol in October 2023 persisted till the first week of November as the large factories in the domestic region were reducing the price of n-Butanol to remain competitive. However, on the 3rd of November, there was a brief rebound in the market, with prices increasing by a narrow range and finally settling at 1086 USD/tonne n-Butanol spot Ex-Shandong with a hike of 1.7% in the H2 of November 2023. The initial decline in the n-Butanol market was driven by the release of demand from the downstream sector, while the improvement from the construction sector helped to drive the market recovery. Moreover, the price reductions implemented by several factories in early November were an attempt to stimulate demand and stabilize the market. The overall supply level of n-Butanol on site was relatively stable, and there was little change in the adjustment of on-site construction compared to the previous period.

After the National Day holiday, celebrated in China in early October, there was some small-scale stocking by downstream markets, but this did not provide enough sustained support for the market. The butanol market quickly fell into a downward trend, and prices continued to move lower. Moreover, the decline in the n-Butanol market was driven by a combination of factors, including weakening demand from downstream industries and increased supply from new production capacity. Talking about the economic condition, the country's manufacturing PMI declined to 49.5 in October 2023, according to data released by the NBS, contracted once again amid weak demand dynamics in China, which has further supported the downtrend. As per the reports, Oriental Energy in Maoming, Guangdong, China, is operating their feedstock Propylene plant at lower run rates, with a capacity of 600,000 mt/year from mid-October till the next announcement, further strengthening the downtrend.

As per ChemAnalyst, the n-Butanol market in China is expected to continue the bullish trend in the upcoming weeks under the influence of healthy support from downstream procurement activities.