China ACN prices surge in early January

In January 2025, the acrylonitrile market experiences a dramatic surge. Prices soar within the first week of the month, and there are currently few market offers, with only scattered and unverified reports of high prices. Plants such as Lihuayi, Haijiang, Koruhr, and Sierbang tighten their spot sales. This sharp price spike, unseen in recent years, leads some industry participants to comment on a return to past market conditions.

The price increase is due to several factors. On the supply side, a sudden breakdown at Lihuayi's unit cut production in half, reducing its market supply and driving up the lower end of the price range. In East China, the restart of Zhejiang Petrochemical was delayed, and Sinopec East had to purchase spot ACN to fill the gap, which led to a reduction in market inventory. Additionally, goods are moving from the north to the south, boosting the relatively lower-priced Shandong market. Both Haijiang and Koruhr cut back on available spot goods to align with the market's need for stockpiling before the holiday, leading to an increase in prices. Meanwhile, some plants adjust their nomination pricing system, significantly increasing price flexibility and paving the way for gradual price increases. Moreover, shipping delays in overseas markets and well-established supply chains in neighboring regions make it difficult to meet the immediate needs of the domestic market. Furthermore, the delayed start-up of ZRCC's unit has led to heightened market expectations.

From the demand side, due to maintenance in December and unit restarts in January, the sharp rise in raw material prices could put acrylic fiber plants in a tough spot. They face a conflict between worsening cash flow and the need to replenish stock. Additionally, with yarn mills shutting down for the holiday, there is little sales support to follow the price increase.

Overall, the price increase is driven by various supply and demand factors, but its peak remains uncertain. The rise in operating rates, fueled by profit incentives, could limit further price hikes.