In the first half of this year, the prices of several key domestic chemical products continued to climb, with some reaching their highest levels in recent years. Among these, raw material medicines were particularly affected, with some experiencing significant price fluctuations. Additionally, the growing emphasis on environmental protection has placed increasing pressure on production costs for these companies, making it harder to manage expenses during the first half of the year. However, the latest report from the National Price Monitoring Center offers a more positive outlook: chemical product prices are expected to stabilize in the second half of the year, with some potentially seeing slight declines.
According to the data, the average price of polyethylene in the first half of the year was 11,740 yuan per ton, a decrease of 3.16% compared to the same period last year. Polypropylene averaged 11,389 yuan per ton, up 6.62% year-on-year. PVC reached an average of 70,020 yuan per ton, down 14.09% compared to last year. Polyester chips fell by 2.83%, averaging 10,654 yuan per ton. Butadiene rubber increased by 9.09%, reaching 15,484 yuan per ton. The average price of the five major chemical products stood at 11,258 yuan per ton, up 0.27% compared to the same period last year.
The report attributes the price increases in the first half to rising demand, higher production costs, and global market trends. Notably, the sharp rise in crude oil prices has significantly boosted the cost of chemical products, providing strong support for price growth. At the same time, international market prices for chemicals have also risen, contributing to the overall upward trend in domestic prices.
Looking ahead, as global economic growth slows in the second half of the year, international crude oil prices are expected to decline, which should help stabilize chemical product prices. From an economic perspective, the growth rate in the second half may be slower than in the first, which could influence the price trajectory of chemical products. Globally, while the economy has been growing rapidly in recent years, this has led to rising commodity prices and accumulating risks. In response, the U.S. has raised its benchmark interest rate to 5.25%, and the EU has also slightly increased its rates. This suggests that countries will remain cautious about potential inflation and financial risks, leading to a moderation in economic growth.
In China, as macro-control measures gradually take effect, the demand for raw materials and prices are expected to stabilize, making it increasingly difficult for chemical product prices to continue rising. Regarding oil prices, the international market is expected to see some fluctuations. During July and August, due to summer gasoline demand and extreme weather, crude oil prices may rise temporarily. However, excessively high prices tend to dampen demand. For example, the International Energy Agency recently reduced its forecast for global oil demand this year from 1.8 million barrels per day to 1.24 million barrels per day. As demand weakens in the off-season, oil prices are likely to fall, which could lead to a slight decline in chemical product prices later in the year.
Despite this, the report notes that overall demand for chemical products remains strong, so prices are expected to stay relatively high in the second half of the year. As a result, raw material medicine producers will still face ongoing cost pressures, which could affect China's competitive advantage in pricing.
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