[Introduction]: During this cycle, under the combined influence of cost support and supply-demand game, epichlorohydrin shifted from an earlier upward trend to a downward trend. As of July 23, the quoted price in the Jiangsu epichlorohydrin market was 11,300-11,400 yuan/ton (acceptance, delivered), down 6.32% from the beginning of the month, with a clear downward shift in the price center. However, downstream end-users have limited acceptance of high-priced raw materials, with the market mainly seeing sporadic small-lot transactions for immediate needs. High-price cargo transactions face sluggish follow-through, resulting in an overall subdued trading atmosphere.
During this cycle, the domestic epichlorohydrin market showed a trend of initial stability followed by decline. As of July 23, the weekly average price in the Jiangsu region was 11,380 yuan/ton, up 4.4% from the previous week. In the first half of the week, cost-side support was relatively solid. The core raw material, glycerin, saw limited price changes, but driven by the supply side's willingness to hold prices firm, cost support for epichlorohydrin strengthened. Meanwhile, despite an overall increasing trend in industry supply, downstream enterprises became cautious in accepting high-priced cargoes. However, low-price cargoes were scarce in the market, and new order negotiations mostly centered within a range, with the price center moving slightly upward. In the second half of the week, market sentiment shifted. As profit-taking began to emerge, some production enterprises showed increased willingness to sell at higher prices, while downstream enterprises held bearish expectations for the future outlook, further cooling procurement enthusiasm and heightening market wait-and-see sentiment. Against the backdrop of prominent supply-demand contradictions and increased pressure to offload inventory, production enterprises grew more inclined to offer concessions to move goods, and the negotiation center for new orders clearly shifted downward. The Shandong market showed a particularly significant decline; on July 23, the ex-factory acceptance price had broken below the 11,000 yuan/ton threshold, with the mainstream negotiation range dropping to 10,800–11,000 yuan/ton. Overall, the epichlorohydrin market turned from strong to weak during this cycle, with hindered high-price transactions remaining the core factor constraining upward momentum. In the short term, market sentiment is expected to remain weak.
I. Epichlorohydrin Supply Side Shows Steady Easing Trend
This week, the supply side of the domestic epichlorohydrin market showed a steady easing trend. During the cycle, units that had previously been shut down or running at reduced loads gradually resumed production. Enterprises in Hebei, Hubei, and other provinces stabilized shipments after restarting. Meanwhile, some producers in Shandong, Jiangsu, and Zhejiang increased their operating rates, further boosting the release of circulating supply. Regarding unit dynamics, enterprises such as Hebei Jia'ao, Hebei Zhuotai, and Zhejiang Zhenyang remain shut down, which to some extent structurally restrains regional supply, but the overall recovery trend in supply remains unchanged. According to statistics from Chempricehub, the average capacity utilization rate for the domestic epichlorohydrin industry this week increased to 47.2%, up 1.3 percentage points from the previous week. In terms of production, during the week of July 17–23, domestic epichlorohydrin output was 27,800 tons, up 2.96% from the previous week, showing a clear incremental trend.
In summary, with the gradual resumption of previously overhauled units and the increase in operating rates at some enterprises, epichlorohydrin market supply continued to increase this week, with overall supply turning loose, providing a certain fundamental basis for subsequent market trends.
II. Cost Fluctuations; Theoretical Profit Margins for Different Processes Further Improve
During the cycle, the main raw material glycerin held firm with upward movement, providing continued cost support for the glycerin-based process. Coupled with high-level narrow adjustments in Jiangsu epichlorohydrin prices, the loss margin for the glycerin-based process was in a state of recovery. For the propylene-based process, raw material propylene prices fluctuated downward, but liquid chlorine prices rebounded to positive territory, leading to increased costs. However, as epichlorohydrin prices weakened, the profit margin for the propylene-based production process was increasing.
From an industry chain perspective, profit changes varied by product. As of July 23, the weekly average profit for Shandong propylene increased to 880 yuan/ton, a broad rise of 1319.35%; the profit for 99.5% glycerin in East China increased to 229 yuan/ton, up 144.79%; the weekly average profit for propylene-based epichlorohydrin increased to 2,927 yuan/ton, up 10.83%; the weekly profit for glycerin-based epichlorohydrin increased to -670 yuan/ton, up 18.29%. For the main downstream product epoxy resin, the weekly average profit for epoxy resin E-51 increased to -65 yuan/ton, up 74.51%; the average profit for epoxy resin E-12 increased to 50 yuan/ton, up 192.59%.
III. Demand from Main Downstream Epoxy Resin Shows Slight Improvement
During this cycle, there were no new maintenance shutdowns in the epoxy resin sector. Operating loads at some plants fluctuated, leading to a slight increase in overall epoxy resin output. The weekly average capacity utilization rate of the domestic epoxy resin industry was 47.74%, up 0.12 percentage points from the previous period. Specifically, the capacity utilization rates for liquid and solid epoxy resins were 50.75% and 31.91%, respectively. On the supply side, no new maintenance units were added this period, operating loads at some plants fluctuated, and overall epoxy resin output increased slightly. During this cycle, domestic epoxy resin output was 39,400 tons, up 0.25% from the previous period.
IV. Short-Term Epichlorohydrin Likely to Stabilize with Weakening Tendency
It is expected that the domestic epichlorohydrin market will likely undergo weak narrow adjustments next week, with the price center facing slight downward pressure. Detailed analysis follows: 1. Although the main raw material glycerin is supported by its own cost, leaving limited room for price declines, the upward momentum is insufficient due to persistently weak downstream demand. It is expected to hold firm within the current range in the short term. Overall, the cost-side driving force for epichlorohydrin price increases is tending to weaken. 2. Previously restarted units are gradually entering stable operation, and the overall industry capacity utilization rate is expected to increase further. However, it is worth noting that planned shutdowns of some units in the Shandong region may partially offset local supply, somewhat cushioning the impact of the overall supply increase. Overall, next week, the domestic epichlorohydrin industry supply is still expected to grow, with ongoing market competitive pressures suppressing upward price space. 3. The main downstream epoxy resin enterprises are currently consuming contracted volumes and inventory raw materials, maintaining immediate need procurement for epichlorohydrin. Although this provides some bottom demand support, new order follow-through is limited, spot trading is subdued, and the negotiation center still faces downward risk.
In conclusion, next week, the epichlorohydrin market, amidst multiple factors including weakening cost support, expected supply growth, and demand primarily based on immediate needs, is unlikely to see a fundamental change in its weak adjustment pattern. The market is expected to mainly oscillate with a weak bias. Subsequent attention should focus on the price trend of raw material glycerin, actual unit startup/shutdown dynamics, and changes in downstream replenishment pace.
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