Lead: Recently, domestic lauric acid prices have been continuously declining. As of May 29, the market price of lauric acid in East China reached 16,700 RMB/ton, down 1,626 RMB/ton week-on-week, hitting a new high in nearly half a year, with a monthly cumulative increase of 8.18%. This round of lauric acid price decline is mainly dragged by both the raw material side and the demand side. The average monthly price of raw material palm kernel oil was 2,183.61 RMB/ton, a decrease of 7.99%; on the demand side, the demand from downstream end-users decreased, showing obvious weakness. The loss of cost support for lauric acid and poor downstream demand are the main reasons for the market decline.

1. Palm Kernel Oil Prices Continue to Decline

During this period, palm kernel oil prices continued to weaken. The main producing regions have entered the seasonal production increase cycle, and overall spot supply has steadily increased, making the market supply pattern tend to be loose, which is difficult to support the current market. At the same time, downstream enterprises' enthusiasm for stockpiling is low, with most consuming existing inventories and only maintaining replenishment on an as-needed basis at low intended purchase prices. Therefore, overall weak demand has hindered the shipment of palm kernel oil. In summary, under the dual pressure of increasing supply and weak demand, the short-term market weak pattern is unlikely to improve, and prices still have room for further decline.