【Introduction】 After the May Day holiday, the domestic acetone market experienced a pattern of initial declines followed by gains. As of May 12, the average price in the mainstream Jiangsu market stood at 7,700 yuan/ton, slightly lower than before the holiday. This was mainly due to tight spot supply in the market, which engaged in a tug-of-war with downstream sectors that only maintained just-in-time purchasing, giving prices strong resistance to declines.

I. Supply Side: Tight Spot Supply Forms Core Support

As of May 11, acetone inventory at the main distribution hub of Jiangyin Port had fallen to a low level of 15,000 tons. Import volumes have decreased, particularly supplies from Saudi Arabia, which have been disrupted by the conflict in the Middle East. Imports from Thailand and South Korea have also declined, providing limited replenishment from short-term arrivals at the port.

Table 1: Incomplete statistics of acetone vessels en route to East China (Unit: tons)
| Date | Vessel Name | Load Capacity | Last Port | Final Port |
|------------|-------------------|---------------|-----------|------------|
| May 10 | CHEM RAMBLAS | 5,300 | Saudi Arabia | Huaxi |
| May 12 | CHEMOCEAN LEO | 2,000 | -- | Huaxi |
| May 12 | DINGHENG 16 | 2,000 | South Korea | Laitan |
| May 14 | WOOJIN PIONEER | 3,000 | South Korea | Huaxi |
| May 19 | SC FALCON | 3,500 | Saudi Arabia | Laitan |
| Total | | 15,800 | | |

Source: chempricehub Information

According to incomplete vessel scheduling data from chempricehub, as of May 12, the total acetone cargo volume for East China in May was estimated at 24,400 tons, with 8,600 tons already arrived and 15,800 tons en route, primarily sourced from Saudi Arabia and South Korea.

Table 2: Changes in phenol-acetone plant operations (Unit: 10,000 tons/year)
| Company | Phenol-Acetone Capacity | Operating Rate |
|--------------------------------|-------------------------|----------------|
| Sinopec Sabic Tianjin | 35 | 85% |
| Jilin Petrochemical | 35 | 60% |
| Blue Star Harbin | 15 | 100% |
| Huizhou Zhongxin (Phase I) | 30 | 0% |
| Huizhou Zhongxin (Phase II) | 45 | 100% |
| CNOOC Shell | 35 | 0% |
| Yangzhou Shiyou | 32 | 90% |
| Lihuayi Weiyuan | 70 | 80% |
| Gaohua Materials | 40 | 0% |
| Taita Xingye (Ningbo) | 63 | 50% |
| Muyiwei Chemical (Shanghai) | 56 | 0% |
| Changchun Chemical (Jiangsu) | 48 | 70% |
| Zhejiang Petrochemical (Phase I) | 65 | 90% |
| Zhejiang Petrochemical (Phase II)| 65 | 90% |
| Wanhua Chemical | 78 | 100% |
| Shenghong Refining & Chemical | 65 | 90% |
| Jiangsu Ruiheng | 65 | 80% |
| Guangxi Huayi | 28 | 100% |
| Longjiang Chemical | 35 | 100% |
| Hengli Petrochemical | 65 | 100% |
| Qingdao Haiwan | 32 | 100% |
| Fuyu Chemical | 25 | 100% |
| Zhenhai Refining & Chemical | 65 | 95% |

Source: chempricehub Information

On the domestic supply side, the capacity utilization rate of phenol-acetone plants has dropped to around 79%. Muyiwei Chemical (Shanghai)'s 560,000-ton/year phenol-acetone unit was shut down for maintenance on April 14, with an expected maintenance period of about 45 days. Gaohua Materials' 400,000-ton/year phenol-acetone unit was shut down for maintenance today (May 12), with restart expected by the end of June. Lihuayi Weiyuan's phenol-acetone unit reduced its operating rate to 80%, while Taita's unit reduced to 50%. In mid-May, Shandong Ruilin's 350,000-ton/year phenol-acetone unit achieved production of first-grade product, but acetone has not yet been offered for sale. Overall, the capacity utilization rate of domestic phenol-acetone plants in the second quarter is trending downward. According to preliminary estimates from chempricehub, acetone production in May is projected to be around 305,800 tons.

II. Demand Side: Profitability Under Pressure, Maintaining Just-in-Time Procurement

Due to multiple domestic phenol-acetone units being in maintenance periods, there is no sales pressure on circulating spot resources, and most manufacturers continue to allocate orders steadily. However, phenol-acetone companies remain in a state of sustained losses, with downstream industries unable to pass on costs effectively and facing pressure on profitability.

From the perspective of downstream profitability, most downstream sectors are generally loss-making. Industries such as bisphenol A, isopropanol, and MIBK are operating at a loss, showing low acceptance of acetone prices. Only the MMA industry has a theoretical profit of 1,156 yuan/ton.

In terms of procurement behavior, downstream enterprises generally adopt a need-based purchasing strategy. Apart from some bargain hunting at low prices, there is little willingness to chase price increases, which limits the upside for acetone prices.

III. Cost Side: Firm Raw Material Prices Provide Support

The upstream raw material benzene has shown firm price performance, providing cost support for acetone. As of May 12, the price of benzene in East China was 8,280 yuan/ton, providing positive support to the acetone market. However, the related product phenol remains in a continuous loss position, with apparent cost pressure. Raw material benzene and propylene prices remain at high levels, leading to deep losses in the phenol-acetone industry, with the theoretical loss expanding to -1,108 yuan/ton. This cost pressure limits the downside for acetone prices.

IV. Outlook for Future Trends

Overall, although the acetone market has support in the first half of May, the momentum for significant upward movement is insufficient. In the short term, the market is likely to continue with a firm but volatile consolidation trend. The low capacity utilization of domestic phenol-acetone plants, combined with insufficient replenishment of port inventory, means that tight spot supply conditions are unlikely to change rapidly. At the same time, upstream benzene is in an upward channel, providing a floor for the cost side and enhancing acetone prices' resistance to declines.