Unit overhauls and volatile feedstocks push China’s PA to high swings in Q2
2026-06-02
Entering Q2 2026, China’s phthalic anhydride sector has entered a concentrated turnaround maintenance cycle. Coupled with drastic price volatility of upstream feedstocks ortho-xylene and industrial naphthalene driven by global geopolitical factors, domestic spot prices of phthalic anhydride have fluctuated at elevated levels amid intensified supply-demand tug-of-war across the market.
Per monitoring statistics from CBI China (Business Agency), multiple production lines commenced scheduled shutdown for maintenance starting April: the 180,000 tpa ortho-process phthalic anhydride plant of Shandong Hongxin, the 40,000 tpa naphthalene-process unit of Zaozhuang Jiefuyi and the 60,000 tpa phthalic anhydride facility of Hubei Nengtai. Several naphthalene-process manufacturers including Tangshan Huayi and Xingtai Xuyang also suspended production for catalyst replacement. Collectively, the ongoing maintenance covers over 420,000 tons of annual capacity, accounting for roughly 16% of China’s effective capacity, dragging the industry’s overall operating rate down to around 58% and tightening available spot supplies in circulation.
On the cost front, spillovers from geopolitical tensions in the Middle East have lifted international crude oil prices, pushing up spot quotations of ortho-xylene. Meanwhile, output curbs at coking plants have tightened the supply of industrial naphthalene and lifted production costs for naphthalene-based phthalic anhydride, forming solid cost support for finished product prices. In early June, mainstream ex-factory quotations for premium-grade phthalic anhydride in East China stood at 6,800–7,300 CNY per metric ton, while spot prices at Shandong manufacturers exceeded 7,300 CNY/ton.
From the demand side, downstream sectors including DOP plasticizers, alkyd resins and unsaturated resins maintained steady operating rates with consistent rigid procurement from coatings and plastic additives manufacturers. Nevertheless, end-users in home decoration and plastic product sectors only make purchases based on immediate needs and are reluctant to build up large inventories, putting a cap on sharp rallies of phthalic anhydride prices.
Industrial analysts forecast that phthalic anhydride prices will stay prone to gains before the restart of overhauled units. With large-scale capacity resumption scheduled for mid-to-late June and subsequent supply expansion, market prices are expected to edge down gradually on a steady trend.
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2026-06-02