China ABS Market Sees Volatile May Amid Supply Pressure and Export-Driven Mid-Month Rebound
Indian ABS prices varied across brands and cities, reflecting regional differences. China’s ABS market saw initial declines followed by recovery, driven by supply adjustments and improved trade relations with the U.S. Overall, the ABS market is expected to remain stable or slightly weaker in the near term amid balanced demand and supply conditions.
Key Takeaways
- Price Variation in India
Natural TAITA and LOTTE ABS prices ranged from ₹1,31,000 to ₹1,42,500 per MT, varying by city and product grade.
- Chinese Market Volatility
ABS prices in China dropped early May but recovered to end the month slightly lower, reflecting market uncertainty.
- Supply and Inventory Pressure
Chinese ABS production peaked mid-month but eased later; inventories remain high, keeping supply ample.
- Feedstock Price Fluctuations
Acrylonitrile, butadiene, and styrene costs rose early in May but fell due to oversupply and weak demand.
- Trade and Capacity Impact
Tariff relief between China and the U.S. boosted exports temporarily, but new ABS capacity plans and macroeconomic caution temper market outlook.
ABS Price Dynamics
- In the Indian ABS market, current prices vary by brand and location. Natural TAITA ABS (5000W) is priced at ₹1,31,000/MT in Ahmedabad and ₹1,34,000/MT in Chennai.
- Natural LOTTE ABS (SD-0150) is being offered at ₹1,34,250/MT in Delhi, while the Black LOTTE ABS (SD-0150 K2007) variant is priced higher at ₹1,42,500/MT in Delhi.
- In May 2025, the Chinese ABS market exhibited a volatile trend—declining initially before recovering later in the month.
- As per the commodity market analysis system, the average price of ABS sample products stood at RMB 10,625/ton on May 31. This represents a marginal decrease of 0.93% compared to the beginning of the month.
ABS Demand and Supply Dynamics: Chinese Production Start Declining
- Supply Side: The ABS production load across China started strong in May, peaking mid-month at 70%, before tapering off to 61% by month-end. Despite overall weekly output falling to around 110,000 tons, inventory levels at polymerization plants remained elevated, though there was evidence of gradual destocking.
- Market supply remained ample. Additionally, announcements of new ABS capacities from two producers placed pressure on market sentiment, suggesting ongoing supply overhang concerns.
- Cost Side: Upstream feedstocks—acrylonitrile, butadiene, and styrene—saw price increases early in the month, providing cost support, but subsequently fell back due to oversupply and weakening demand.
1. Acrylonitrile: Saw early gains due to tightening supply and strong export orders but corrected later in the month as demand normalized and expectations of new capacities emerged.
2. Butadiene: Prices surged mid-month on the back of unplanned shutdowns and tight port supply, only to fall sharply as imports increased and downstream demand weakened.
3. Styrene: Benefited from improved macro sentiment and lower port inventories mid-month, but faced downward pressure later due to high inventory, weak demand, and resumption of production units.
4. Demand Side: Downstream ABS processing plants maintained steady operating rates. Purchasing remained largely need-based with occasional bottom-fishing. Mid-month improvements in U.S.-China trade relations, particularly tariff easing, boosted sentiment.
- This led to a rise in export orders from ABS terminals—particularly in consumer electronics and home appliances—spurring a short-term demand recovery. However, by late May, the momentum cooled, and liquidity weakened, resulting in an overall mild demand support for the month.
ABS Market News: China-U.S. Tariff Cuts Boost Exports
- Zhejiang Petroleum & Chemical (ZPC) is planning to shut its No.3 Butadiene (BD) Plant on 23rd June, 2025 for planned maintenance work. The Plant is located in Zhejiang, China with a production capacity of 250,000 Tons/Year.
- Styrene Monomer prices assessed stable at US$ 870/- per MT FOB Korea basis.
- ABS prices closed stable at €1700/MT and PET at €1000/MT FD NWE basis.
- Trade Relief: A key driver mid-month was the announcement of reduced tariffs between China and the U.S., which significantly boosted ABS exports and spot market enthusiasm.
- New Capacity: Market sentiment remained cautious due to the expected addition of new ABS production capacity from two domestic companies, increasing long-term supply concerns.
- Macro Weakness: Towards the end of the month, the impact of strong macroeconomic news faded, and the ABS market settled into a more balanced, wait-and-watch mode amid high inventories and mild demand.
Expert Opinion: Inventory and Demand Balance Out
- The ABS market in China is expected to continue a consolidative trend in the near term. While short-lived gains were observed due to export revival and feedstock cost support, these were offset by high inventories and cautious downstream buying.
- With both cost and demand factors losing steam by month-end, the ABS market may remain range-bound or slightly weaker in the short run.