The recent acetone market has experienced a price adjustment from previous highs, followed by a gradual rebound supported by rising raw material costs. After reaching a five-year peak in September, domestic acetone prices entered a correction phase around the National Day holiday before recovering as cost pressure strengthened.

The current market remains influenced by multiple factors, including raw material price movements, domestic supply changes, port inventory levels, and downstream purchasing activity. The short-term market outlook is expected to remain in a range-bound pattern, with both bullish and bearish forces competing.

Acetone Prices Correct After September Rally

In September, the domestic acetone market showed a strong upward trend. Prices in East China briefly exceeded RMB 9,300/ton, reaching the highest level seen in nearly five years. The price increase was mainly driven by two key factors: rising production costs and tightening market supply.

However, the market sentiment changed before the National Day holiday. During the final trading days before the holiday, downstream manufacturers showed limited interest in stocking up. Many buyers preferred to wait and observe market developments after the holiday, resulting in weaker spot demand and pressure on high-priced offers.

After the holiday, Sinopec reduced its listed acetone price in East China by RMB 300/ton to RMB 8,800/ton. In Shandong, mainstream market prices declined by up to RMB 600/ton during the holiday period. Inventory holders also lowered quotations to accelerate shipments, causing the market to enter a short-term adjustment stage.

Rising Raw Material Costs Support Acetone Rebound

Following the holiday correction, the strong increase in upstream raw material prices provided renewed support for the acetone market.

Benzene prices continued to rise in East China, with spot trading levels briefly reaching RMB 10,500–10,800/ton. Sinopec also increased its listed benzene price to RMB 10,600/ton. The continued strength of benzene prices provided solid cost support for phenol-acetone producers.

At the same time, the Shandong propylene market experienced a rapid increase. Mainstream transaction prices rose from around RMB 10,000/ton before the holiday to approximately RMB 10,745/ton, creating additional upward pressure on acetone production costs.

Driven by higher raw material costs, acetone prices gradually recovered from their previous lows. By mid-October, East China acetone prices had returned to around RMB 8,700–8,750/ton.

Port Inventory Rises, Market Caution Remains

Although acetone prices have rebounded, inventory pressure has become an important factor limiting further increases.

After the holiday, both imported cargoes and domestic supplies arrived at ports, leading to a significant increase in acetone stocks. Jiangyin port inventory increased from approximately 7,500 tons on September 28 to 22,500 tons, representing nearly a threefold increase.

The rapid accumulation of port inventory has strengthened market caution. Buyers remain hesitant to increase purchasing volumes, while suppliers closely monitor market conditions.

However, most port inventory is concentrated among a limited number of suppliers. These suppliers currently show limited willingness to reduce prices significantly, which provides some support for the market and prevents a sharp decline.

Downstream Demand Recovery Remains Limited

From the demand side, downstream industries continue to face profitability pressure. Key acetone-consuming sectors, including Bisphenol A (BPA), Methyl Methacrylate (MMA), and Isopropyl Alcohol (IPA), have shown limited acceptance of high-priced raw materials.

Purchasing activity remains mainly focused on essential demand, while large-scale inventory replenishment has not yet returned. The current market is characterized by a clear standoff:

• Suppliers are attempting to maintain higher price levels due to cost pressure.
• Downstream buyers remain cautious and prefer waiting for clearer market direction.

This supply-demand imbalance has restricted the strength of the acetone rebound.

Acetone Market Outlook: Range-Bound Fluctuation Expected

Looking ahead, the acetone market is expected to maintain a fluctuating consolidation pattern in the short term. Supply, cost, and demand factors will continue to jointly influence market direction.

Supply Side: Capacity Changes May Offset Each Other

Domestic phenol-acetone plant operating rates remain around 83.5%.

On the one hand, the restart of Huizhou Zhongxin Phase II phenol-acetone unit has increased market supply expectations. On the other hand, maintenance plans for Yangzhou Shiyou and SABIC-Sinopec Tianjin phenol-acetone units may reduce available supply.

The combined impact of plant restarts and maintenance activities may keep overall supply relatively balanced, with a possibility of slight changes in operating rates.

Cost Side: Strong Support Remains but Momentum Weakens

International crude oil prices remain at elevated levels, supporting benzene prices. Meanwhile, benzene port inventories remain relatively low, and spot supply continues to be tight.

Although benzene prices have recently eased slightly, a significant decline is unlikely in the near term. High-level fluctuations are expected to continue, providing a certain degree of cost support for acetone.

However, compared with the previous period, cost-driven upward momentum has weakened, limiting the potential for rapid acetone price increases.

Demand Side: Recovery Speed Is the Key Factor

Downstream demand remains the main factor restricting acetone price growth.

Although industries such as BPA and MIBK still have essential purchasing needs, overall buying enthusiasm remains weak. End-users continue to focus on inventory control and cost management rather than active replenishment.

A stronger and more sustainable acetone price recovery will depend on whether downstream industries improve operating rates and gradually increase raw material purchases.

Conclusion

Overall, the Chinese acetone market is expected to remain in a range-bound fluctuation phase in the short term. Rising raw material costs provide support, while increased inventory and weak downstream demand limit further price gains.

Future market trends will mainly depend on three key factors:

1. Changes in domestic phenol-acetone plant operating rates
2. Fluctuations in benzene and propylene costs
3. The pace of downstream inventory replenishment

The market is likely to continue experiencing a balance between supply-side support and demand-side pressure before a clearer direction emerges.