【Introduction】: In the third week of June, the domestic acetone market experienced a sharp decline. According to monitoring data from chempricehub, the average price of acetone in East China fell to 6,050 RMB/ton on June 16, down 540 RMB/ton from 6,590 RMB/ton on June 12. The single-day drop on June 15 reached 4.78%, and on June 16 it was 3.59%. Petrochemical companies slashed prices by as much as 500 RMB/ton. Behind this rare decline is a convergence of three negative factors: cost collapse, supply-side release, and weak demand.

I. Cost Collapse: Expected Strait Opening Breaks Price Floor

The most direct trigger for the sharp drop in acetone market prices this week came from the overall weakening of upstream raw material prices. Pakistani Prime Minister Shehbaz Sharif announced in mid-June that the US and Iran had reached an agreement to end hostilities, with a formal signing ceremony expected in Switzerland on June 19. The US confirmed it would lift its blockade on Iran, and Iran is expected to open the Strait of Hormuz. This major geopolitical shift has quickly eliminated the war premium in the crude oil market. As the world's most important oil transportation chokepoint, the reopening of the Strait of Hormuz effectively removes the risk of supply disruption. Brent crude oil fell by 4.76% on June 15. Affected by the significant decline in international oil prices, raw materials such as pure benzene and propylene faced downward pressure.

Table 1: Summary of Domestic Acetone Industry Chain Prices (Unit: RMB/ton)

| Market | Product | June 12 | June 16 | Change | Change (%) |
| --- | --- | --- | --- | --- | --- |
| Key Upstream | | | | | |
| East China | Pure Benzene | 7,580 | 7,190 | -390 | -5.15% |
| Shandong | Propylene | 8,795 | 8,275 | -520 | -5.91% |
| Acetone | | | | | |
| East China | Acetone | 6,590 | 6,050 | -540 | -8.19% |
| North China | Acetone | 6,575 | 6,125 | -450 | -6.84% |
| Shandong | Acetone | 6,525 | 6,050 | -475 | -7.28% |
| South China | Acetone | 6,875 | 6,650 | -225 | -3.27% |
| Key Downstream | | | | | |
| East China | Bisphenol A | 8,700 | 8,700 | 0 | 0.00% |
| East China | MMA | 12,350 | 12,350 | 0 | 0.00% |
| East China | Isopropanol | 7,175 | 6,925 | -250 | -3.48% |
| East China | MIBK | 11,000 | 10,600 | -400 | -3.64% |
| Source: chempricehub | | | | | |

As shown in the table above, on June 16, the price of pure benzene in East China fell by 390 RMB/ton to 7,190 RMB/ton compared to June 12; propylene in Shandong fell by 520 RMB/ton to 8,275 RMB/ton. As core raw materials for phenol-acetone, the significant weakness in pure benzene and propylene prices directly undermined acetone's cost support.

With costs continuously dropping, market holders became unstable, offering discounts to speed up destocking, and petrochemical companies accordingly lowered their opening prices by as much as 500 RMB/ton. Major plants collectively cut prices, which further guided the market center downward.

According to chempricehub calculations, on June 16, the production profit for phenol-acetone enterprises was -453 RMB/ton. Although it recovered slightly from earlier in the month, the industry as a whole remained in a loss state.

II. Supply-side Pressure: Domestic Phenol-Acetone Unit Operating Rate at 77%, Port Inventories Recovering

As the cost side weakened, supply-side pressure also emerged. Looking at the operation of domestic phenol-acetone units, previously overhauled units gradually resumed operation, and the capacity utilization rate of domestic phenol-acetone units stood at 77%.

As of June 15, acetone port inventory in Jiangyin, China, was 16,500 tons, including 2,500 tons at Hengyang and 14,000 tons at Huaxi. Recent arrivals were mainly supplemented by Thai, South Korean, and domestic cargoes. There are still a total of 13,000 tons of domestic and Saudi cargoes in transit. The increasing availability of spot goods on the market made supply ample, sharply increasing holders' destocking pressure, and supply-side support weakened significantly.

III. Weak Demand: Traditional Off-season, Downstream Wait-and-See Procurement Languishes

With the arrival of hot weather, it is the traditional off-season for downstream industries. End-user factories have limited new orders, resulting in a sluggish overall trading atmosphere. Operating rates of major downstream industries such as bisphenol A and MMA declined, reducing demand for raw materials. During the continuous decline in the acetone market, end-users generally adopted a wait-and-see attitude. The mindset of "buying on rising prices, not on falling prices" persisted, with few active inquiries entering the market, making actual deals difficult to conclude. Some downstream end-users focused on consuming previous inventories. Even when tender procurement occurred, they bought at the lowest possible prices, failing to provide effective support to the market.

IV. Short-term Market Outlook

In summary, from the start of the third week of June, under the combined pressure of three factors, the mainstream negotiated price of acetone in East China has fallen to around 6,000 RMB/ton. Looking at the current landscape, the resolution of geopolitical risks has established a weak tone on the cost side, while demand is unlikely to improve significantly in the short term. Restoring operational confidence will take time. In the near term, the acetone market may still face downward pressure. Going forward, attention should be paid to the impact of crude oil trends on pure benzene, the start/stop dynamics of phenol-acetone units, and changes in downstream restocking pace.