IPA Prices in India Under Pressure, Recovery Hinges on Bulk Drug Uptick

Key Highlights

• Traders offering IPA at ₹80/kg, below Deepak Phenolics’ distributor quotes. 
• Pharma and personal care industries account for ~50% of demand. 
• Imports (~10–11 kt/month) keep market oversupplied despite steady domestic output. 
• Short-term bearish trend; rebound likely as bulk drug demand picks up.

IPA Prices Correct to ₹80–84/kg Amid Import Pressure

Traders are offering isopropyl alcohol (IPA) at ₹80/kg ex-JNPT, while Deepak Phenolics’ authorised distributors and traders are quoting ₹84/kg ex-Taloja and ₹81/kg ex-Dahej. Importers are thus placing material at lower levels of ₹80/kg ex-JNPT compared with domestic distributors and traders.

IPA price remains closely tied to its key feedstock, propylene, which is derived as a by-product of petroleum refining and natural gas processing.

In August, IPA prices softened in the Chinese market, with the monthly average declining by 4.94% from 5,900 RMB/ton on 1 August to 5,608 RMB/ton on 29 August. The persistent weakness in acetone markets further weighed on sentiment, dampening confidence in IPA.

Pharma & Personal Care Drive Half of India’s IPA Demand

The pharmaceutical sector, particularly bulk drug manufacturers, continues to represent the primary demand segment for IPA in India. Additional demand arises from the personal care industry, which collectively accounts for nearly 50% of total domestic consumption.

Secondary demand comes from industrial chemicals and manufacturing sectors, where IPA is utilised as a solvent for resins, cleaning applications, and intermediates such as isopropyl acetate, as well as from the paints, coatings, and inks industries.

Bulk pharmaceutical production is gaining momentum, and this is expected to translate into increased IPA consumption in the near term.

Domestic Output at 10.8 kt; Imports Add 10–11 kt Monthly

An influx of imports has contributed to an oversupply situation in the Indian IPA market.

Domestic production is led by Deepak Phenolics and Deepak Fertilizers, contributing around 10,800 tons per month, while imports add a further 10,000–11,000 tons monthly. India’s total demand is estimated at around 21,000 tons per month.

Although domestic pricing from Deepak Phenolics’ authorised distributors has been maintained, competitive pressures persist amid steady import arrivals.

Key downstream chemical derivatives produced from IPA include methyl isobutyl ketone (MIBK), isopropylamines, and isopropyl esters. India’s IPA balance continues to rely on imports to bridge the gap between demand and supply. While installed domestic capacity is significant, production utilisation levels and import parity pricing remain critical factors influencing market dynamics.

IPA production is also indirectly linked to phenol operations, as propylene and acetone streams serve as important intermediates. In Asia, China’s propylene spot prices were seen oscillating between $877/mt and $900/mt, shaping IPA cost dynamics across the region.

News and Global Market Outlook

WTI crude futures steadied near $65.36 per barrel, holding gains of over 1% as energy markets reacted to intensifying geopolitical tensions and supply disruptions. Attacks on refining infrastructure, impacting nearly 17% of Russian capacity, coupled with fresh sanctions on shipping, have heightened concerns over global supply security.

Expert Insights: Short-Term Weakness, Recovery on Pharma Uptick

IPA prices in India are undergoing a correction, with short-term weakness and a bearish trend expected as benzene and crude oil values continue to soften. However, a sharp rebound is anticipated once downstream bulk pharmaceutical producers ramp up operations. End-users are advised to build inventories during low-price phases in order to secure cost advantages ahead of the expected recovery.