Neopentyl Glycol (NPG) CAS NO.126-30-7 Review and Forecast Analysis

【Price Review】
In July, the price of neopentyl glycol products gradually fell, and at the end of the month, the focus was less than in June. As of July 31, hydrogenated neopentyl glycol fell 218.12 USD/ ton from the previous month.
The profit and loss level of the neoprene glycol industry improved in July, and the average monthly gross profit of China’s domestic hydrogenation process increased by 20-30 USD/ ton compared with the previous month. In the early stage, due to the high finishing of the raw material isobutyraldehyde, the cost side pressure is too large, and the neopentyl glycol factory still has orders to execute, and the offer is still relatively strong. However, with the tightening of downstream orders, the transmission of high-price raw materials is not smooth, and the demand has been reduced and stopped in July, and the overall price of neopentyl glycol is weakening. With the collapse of isobutyral in the middle of the year, the concession of neopentyl glycol slowed down. Until isobutyraldehyde stopped falling and there was a slight sign of recovery, the low stock of raw materials coupled with the rebound of raw materials, under the dual factors, neopentyl glycol customers began to restock at a low level, and the transaction improved.

【Market Supply】
Neopentyl glycol in July started 64.7% of the load, the output of 42,000 tons, the load rate of start down 9.91 percentage points from June.

【Demand Side】
The main downstream demand for neopentyl glycol and isophthalic acid decreased in July. In July, the operating load of polyester bottle flakes was 72.11%, down 8.48 percentage points from the previous month, and the demand for m-benzene was reduced.
In terms of unsaturated resin, the average monthly start was near 27%, stable from the previous month, maintaining just demand.
In terms of polyester resin, some large factories have also entered the ranks of parking maintenance and production reduction, and the consumption of neopentyl glycol has been significantly reduced, the start of construction has declined, and the demand has contracted.

【Industrial Chain Data Analysis】
In July, the prices of neopentyl glycol and products in the upstream and downstream industry chain mainly fell except for liquid alkali. Due to the centralized shutdown and maintenance of some chlor-alkali plants, the supply of liquid alkali is reduced, causing the price to rise. In July, the average monthly price of 32% of China’s domestic liquid alkali market was up and down from the previous month. In July, mainly boosted by the maintenance of phased chlor-alkali enterprises and production cuts, the price of alumina procurement liquid alkali rose, and some market prices rose slightly. Among the falling products, the decline of isobutyraldehyde is surprising. Mainly due to the retaliatory decline caused by the poor transmission after the early push up, the decline reached 19.4%. Under its drag, the price of neopentyl glycol fell by 12%, and the decline of neopentyl glycol was faster than that of isobutyraldehyde, mainly due to the reduction of demand. In addition, formaldehyde and unsaturated resins also fell in a narrow range, respectively, due to the tightening of demand and the weakening of cost support.

In short, the start of neopentyl glycol and upstream and downstream industry chains in July was mainly down. The start of raw material isobutyral industry decreased, mainly due to the maintenance of factories, and due to the decline in product prices, individual factories in the later period changed to isobutanol production. Neopentyl glycol industry maintenance is concentrated, and due to the poor transaction of neopentyl glycol, some factories reduce production and reduce negative production. The start of the formaldehyde industry decreased slightly, and the start of the unsaturated resin industry was low and stable.

【Statistics on domestic imports of NPG】
According to statistics, in June 2024, China’s imports of neopentylene glycol were again reduced to 615 tons, a decrease of 18.3% from the previous month, and a year-on-year decrease of 89.8%. In terms of price, the average import price in June was 199.59 USD/ ton, up 75.61 USD/ ton from the previous month, much higher than the level of the same month last year. South Korea, the main import partner, has reduced its supply to China since 2024, and although South Korea’s willingness to enter has increased after domestic prices rose in June, domestic factories are not very active in accepting high prices, and are still dominated by some core customers. As of June, the import volume of neopentyl glycol was 9,196.21 tons, down 65% year-on-year.

【Statistics on domestic exports of NPG】
According to the data, the export of neopentyl glycol in June 2024 was 2,889.758 tons, a decrease of 0.6% from the previous month and a decrease of 23.3% year-on-year. Due to the rise in domestic prices and the rise in Shanghai freight, neopentyl glycol export orders were mainly based on previous orders, and the new orders contracted slightly, and the number decreased from the previous month. As of June, the export volume of neopentylene glycol in 2024 was 13,000 tons, a 27% decrease year-on-year.

【 Future Outlook of NPG Market 】
Supply and demand balance analysis: The gap between supply and demand of neopentyl glycol in July was estimated at 0.86 million tons, which was larger than that in June. Imports changed little from the previous month, the country’s production has contracted significantly, but because of the tightening of domestic and foreign demand, especially the reduction of domestic demand, the gap between supply and demand has widened, which has a favorable impact on prices.
In August, the industry overhaul ended, supply increased, demand showed a rebound trend, the gap between supply and demand narrowed, and there was a certain support for prices in the early stage. Demand continued to increase in September, supply also reached the maximum at this time, demand into the traditional peak season, the price focus will not be too low.

It is expected that in the next 3 months, neopentyl glycol will fall after high, and the neopentyl glycol market will be high and low next month. Mainly due to the following reasons:
1. On the one hand, the level of Chinese domestic factories has been improved, and the supply has increased under the complete release of new devices.
2. On the other hand, the downstream demand industry load is low, the overall demand increment is limited.
3. The raw material isobutyraldehyde is still tight, the trend is strong, and the cost side support is strong. In August, the impact of the cost side is still large, as the supply of raw materials eases down, the recovery of downstream demand is limited, and the high price resistance of neopentyl glycol increases, and it may fall in the later period.
4. By the end of September, part of the neopentyl glycol factory maintenance is completed, the demand picks up, the price rises, but relatively limited, the end of the peak season in October, the price will fall slightly.