China Phenol Falls to New 2025 YTD Low as Price Competition Picks up Pace
Spot phenol prices in eastern China fell last week to their lowest so far this year, and some market participants expect further declines as newly expanded northern production capacity triggered a price war that now threatens to spill into the eastern market. The correction in China is also weighing on sentiment in India, where buyers are turning cautious amid worries of continued regional weakness.
The weekly average spot phenol price in eastern China dropped to 6,205 yuan per metric ton ex-tank for the assessment week ended on Thursday, according to data from Chemical Market Analytics by OPIS, marking a fresh year-to-date low. The weekly average price was equivalent to an import parity value of about $724/mt CFR China, before antidumping duties were added.
As OPIS reported earlier, the late-September commissioning of PetroChina Jilin Petrochemical’s plant has put pressure on Shandong-based producers, given the limited buyer base in that province. PetroChina Jilin does not plan to commission its 240,000 mt/year BPA unit until next year, which means all its phenol output is sold to the merchant market.
According to a China-based trader, the mid-November restart of Shandong Fuyu Chemicals’ plant from a month-long turnaround has only added to the swollen supply in the north, and it is only a matter of time before mounting inventories prompt producers in that region to start slashing prices.
Following the early-July commissioning of Sinopec Zhenhai Refining & Chemical, eastern China is facing a similar imbalance in supply and demand. Prolonged downstream margin compression and decreased end-user offtake have prompted an eastern China-based producer to consider diverting some 5,000 mt of surplus material to Shandong — a move likely to intensify the escalating price war in that province. Despite the roughly 400 yuan/mt land-transport cost, sending cargoes northwards illustrates the depth of the supply-demand mismatch the said producer is contending with, said the trader.
Phenol prices in China have yielded to a supply and demand imbalance through the final quarter of 2025, with November marking a decline from October. As Shandong-based producers cut prices to boost sales, the heightened selling pressure is spilling into the eastern China market, potentially pushing December prices below November levels, the trader added.
Spot phenol prices in eastern China approached 6,000 yuan/mt ex-tank on Tuesday, according to two market participants.
There are no reports of unplanned outages. Formosa Chemicals Industries (Ningbo) Co.’s plant is approaching the final stages of a 45-day turnaround which began in late October. Hengli Petrochemical (Dalian) Co. in late November took its plant offline for 10 days to facilitate a parts change. In mid-December, Zhejiang Petroleum and Chemical Co. plans to commence around 35 days of maintenance at its Phase 2 phenol and BPA units.
Despite month-to-month fluctuations, for most of 2025, Chinese phenol makers’ operating rates have averaged above 70%, at times approaching 80%, according to data compiled by CMA. On the other hand, operating rates in the key downstream BPA sector dipped below 70% in September.
Out of a total nameplate capacity of 6.19 million mt/year, BPA capacity utilization averaged 66.5% in November, versus 68% in both October and September, the data shows. Steep losses have also prompted two phenol-based cyclohexanone producers to halt operations, according to market sources.
For phenol imports, no delivery from the Middle East is expected to arrive over end-November to early December, with the next delivery now slated to reach eastern China only in late December or early January, market sources said.
Meanwhile, the widening gap between CFR China and CFR India prices is putting pressure on the latter, according to a regional trader, as comparatively low CFR China values would only prompt Northeast and Southeast Asian producers to send their spot material to India, where prices have held at the mid-$800s/mt CFR for December loading.
“The China market correction is now weighing on CFR India discussions. Our customers have been postponing discussions, saying they want to reassess the situation,” the trader said.
Moreover, ongoing talk that Indian producers have filed petitions to the Directorate General of Trade Remedies to initiate antidumping investigations into phenol imports from certain countries has added to an air of uncertainty.
For related products, India has imposed ADDs on imports of liquid epoxy resins from China, South Korea, Saudi Arabia, Thailand and Taiwan, China, effective Nov. 17, according to a notice published by India’s Department of Revenue, Ministry of Finance, the same day. The ADD rates range from $37/mt to $483/mt and will be imposed for a period of five years.
–Reporting by Trisha Huang, thuang@opisnet.com; Editing by Mei-Hwen Wong, mwong@opisnet.com