[Lead] This week, the domestic acrylic acid market fluctuated with a firm tone, with the price center shifting upward by 270 CNY/ton compared to the previous cycle, an increase of 3.55%. A number of units, including Fujian Binhai and Qixiang Tengda, underwent concentrated maintenance, coupled with load reductions at some facilities, causing the industry operating rate to plummet to 64.17%. The tightening of spot supply became the core logic supporting price increases. Despite insufficient cost support and slow downstream demand recovery, the acrylic acid price center is expected to remain at a high level in the short term, driven by reduced supply.

1. Concentrated Maintenance: Supply-side Support Drives the Market

Supply tightening was the core driving force behind the rise in acrylic acid prices this cycle. Multiple acrylic acid units entered maintenance or reduced load this week: Fujian Binhai's unit was shut down for maintenance, Qixiang Tengda's 80,000-ton/year unit had a brief stoppage, and Kaitai's unit was also under maintenance. Load reductions at some facilities further exacerbated the tight spot supply situation. As a result, the overall operating rate of the acrylic acid industry fell to 64.17% this week, down 5.18 percentage points from the previous period. Against the backdrop of continued supply tightening, acrylic acid producers and holders strengthened their price support intentions, offering flexible quotations, driving the domestic acrylic acid market to show an oscillating trend of initially rising then falling. The market moved up first and then down, but the overall price center shifted significantly upward compared to the previous cycle. The spot price operation range was 7,750-7,950 CNY/ton, an increase of 270 CNY/ton from the previous cycle, or 3.55%.

2. Slow Demand Recovery: Limited Support from Inelastic Demand on Prices

In contrast to the supply side, the demand side provided relatively limited support for acrylic acid prices. During this cycle, downstream users mostly digested contracts and inventories, with generally low enthusiasm for market purchases. Only some sought appropriate prices for essential demand follow-up, with a clear lack of willingness to chase higher prices. Looking at downstream operating data, the capacity utilization rate of butyl acrylate fell from 50.74% last week to 50.19%, down 0.55 percentage points month-on-month; SAP resin fell from 52.38% to 51.37%; and water treatment agents fell from 53.28% to 52.62%. The operating rates of all three major downstream categories showed a slight decline, indicating that the pace of terminal demand recovery remains slow, with overall demand volume insufficient. Additionally, traders were generally cautious in purchasing sentiment due to the continuous decline in upstream raw materials, and the market lacked concentrated restocking behavior. Overall weakness on the demand side to some extent constrained the upward space for acrylic acid prices, making it difficult for prices to form a sustained rally.

3. Easing Cost Support: Suppressing the Upside Potential for Prices

From the cost perspective, the raw material propylene market experienced a broad decline, significantly dragging down the rise in acrylic acid prices. Cost support loosened, suppressing the upside potential for prices. During the week, the ceasefire agreement between the U.S. and Iran was reached, increasing expectations for navigation through the Strait of Hormuz. Market risk aversion weakened, leading to a decline in upstream raw material prices such as crude oil and propane, significantly loosening cost support for propylene. Affected by this, propylene prices in the East China market continued to fall. Producers lowered prices to hedge risks, downstream users replenished as needed based on essential demand, and market transactions were cautious. As of June 18, the mainstream transaction price of propylene in Shandong was 7,300 CNY/ton, down 17.28% week-on-week; in East China it was 7,450 CNY/ton, down 16.29% week-on-week. The rapid decline in propylene prices weakened support for acrylic acid from the cost side, suppressing its upward price potential. Furthermore, from the supply-demand perspective, the fundamental support for the current propylene market was also insufficient: the start-up plans for multiple downstream units, including octanol, acrylonitrile, and acrylic acid, were delayed, and the overall downstream demand recovery was slow. Traders were generally cautious in purchasing sentiment due to the continuous decline in upstream raw materials. The market lacked concentrated restocking behavior, making it difficult to effectively support propylene prices. Overall, the cost collapse of raw materials, combined with the weak supply-demand fundamentals of propylene itself, jointly weakened the cost support for acrylic acid, thereby suppressing its further upward price exploration.

4. Future Outlook

The East China acrylic acid market is expected to operate with a weak and fluctuating tone next week. From the cost side, the probability of the raw material propylene market stabilizing is relatively high, and the cost-side support is generally moderate, making it difficult to effectively boost acrylic acid prices. On the supply side, Guangxi Huayi is expected to reduce its operating load. Coupled with some units currently in maintenance or low-load operation, the industry capacity utilization rate may narrow further. On the demand side, acrylic acid producers and holders will mostly quote in line with market conditions and actively sell. Downstream specialty ester and SAP factories have some essential demand inquiries, but overall, they still focus on digesting contracts. High-priced goods are clearly limited in transactions, and the market remains heavily in a wait-and-see mood. Overall, the short-term market is expected to maintain a weak and stable consolidation operation.