DOP price have fallen to a new low for the year!

August 26, 2024

The DOP market remains sluggish, with prices repeatedly hitting new lows. Recently, due to the dual pressure of the decline in raw material octanol prices and weak demand, the domestic DOP market prices have continued to decline, reaching a new low for the year. As of August 14th, the average price of DOP in Shandong region was 8825 yuan/ton, a decrease of 8.07% from the initial average price of 9600 yuan/ton in July. The negative factors in the market are relatively concentrated, and they have not stopped in the downward channel. Letting profits fall has become the norm.

Raw material prices have fallen, easing cost pressures
Since mid July, the price of raw material octanol has continued to decline. As of August 14th, the octanol price in the Shandong market was 8200 yuan/ton, a decrease of 1300 yuan/ton or 13.68% from the initial price of 9500 yuan/ton in July. This low point is also the lowest point of the octanol market price in 2024. During the continuous decline of the raw material octanol, the cost transmission of DOP is weakened, resulting in a continuous decline in DOP prices. However, at the same time, with octanol leading the decline, the cost pressure on the DOP industry has been somewhat alleviated, and companies can still maintain a low profit state. However, with the commissioning of new octanol units, the supply-demand imbalance in the octanol industry will further intensify, and the situation of low profits and low production may become the norm, which is undoubtedly negative news for the long-term development of the DOP industry.
Weak demand and insufficient market confidence
The DOP industry is currently in a low season, and the production and sales of PVC soft products in the terminal industry are not strong, resulting in poor inquiries and procurement of DOP. In the context of the continuous decline in DOP, downstream enterprises generally have the sentiment of "not buying the decline", which makes the shipment resistance of DOP merchants high, and they have to further explore profit margins. Although the traditional peak season of "Golden September and Silver October" is approaching, the market's expectations for demand are not optimistic, and it is expected that terminal purchases of DOP will continue to be dominated by small orders for essential needs. This weak demand situation is difficult to improve in the short term, which continues to suppress the prices of the DOP market.
Overall, under the dual pressure of declining raw material prices and weak demand, the DOP market will continue to operate at a low level in the short term. Although with the long-term decline and the gradual stabilization of the trend of raw material octanol, the decline in the DOP market may gradually narrow, and there may even be a possibility of short-term bottoming out, in the medium and long term, the market is still bearish, and the downside risk cannot be ignored. For the DOP industry, seeking breakthroughs in adversity, resolving supply-demand conflicts, and boosting market confidence will be a severe test.

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