Pom monthly review: Limited Support, January Market Explores Higher Before Retreating

I. This Month's Core Hot Topics

1) Regarding equipment maintenance, the phase one POM unit of Yankuang Lubei Chemical in January initiated a shutdown for maintenance, which to some extent affected the industry's supply pattern and became a short-term positive factor for the market.

2) In terms of price adjustments, domestic POM ex-factory prices collectively increased this month, with an upward adjustment range of 500-900 yuan/ton, directly driving market prices to test higher levels.

3) In terms of market trends, the POM market generally showed a pattern of rising initially and then declining this month, driven by positive factors such as proactive price support from traders and price increases from manufacturers. However, the support from these positive factors was limited, and a sustained upward trend could not be achieved.

II. POM Market Analysis This Month

In January 2026, the domestic POM market generally showed a trend of stable growth, with an initial rise followed by a decline. The core characteristic was "favorable factors driving exploratory increases, followed by a fallback due to insufficient demand." Price performance varied slightly across different regions. Looking at mainstream market prices, the average price in East China this month was 11,100 yuan/ton, remaining unchanged from the previous month. The average price in South China this month was 10,500 yuan/ton, an increase of 300 yuan/ton from 10,200 yuan/ton last month, reflecting a pattern of localized increases and overall stability.

Looking at the month in stages, market trends can be clearly divided into three phases: In early January, coinciding with the New Year's Day holiday, industry players generally withdrew from the market for the break, resulting in a temporary halt in actual trading across various regions. Following the holiday, domestic petrochemical plants collectively raised their ex-factory prices, triggering a "buy-up, not buy-down" sentiment among market participants. This led to concentrated replenishment from downstream sectors, allowing manufacturers to continuously reduce their inventories. However, constrained by overall pressure on market shipments, some traders remained cautious about following the price hikes, while others actively held prices firm due to tight supply. Furthermore, the limited inventory digestion capacity of end-user factories meant that actual transactions during this period were generally lackluster, leaving the price increases without solid demand support.

Mid-month, petrochemical plants have sufficient pre-sale orders, with no short-term inventory pressure, and market fundamentals are relatively stable. However, industry players lack confidence in the future market, weakening the upward momentum. Some traders are facing significant inventory pressure and are offering larger negotiation margins to promote sales. Others are still tentatively raising prices, but downstream demand is slow to follow, resulting in sporadic spot transactions. Prices are stuck in a stalemate and fluctuating.

In the latter half of the month, petrochemical plant pre-sale orders gradually decreased, total inventory continued to accumulate, shipping pressure increased, and the market focus shifted to inventory digestion. Terminal demand showed no signs of significant improvement, leading to increased bearish sentiment among market participants. The market saw more instances of high quoting followed by low transactions, with actual deals primarily negotiated based on volume. The earlier upward trend could not be sustained, and the market entered a downward phase, ultimately exhibiting a pattern of initial rise followed by a subsequent decline.

III. Market Influencing Factors Analysis

1) Price Factors: Regional price performance diverged, with POM mainstream quotes in East China at 11,100 RMB/ton, remaining stable compared to the same period last month with no fluctuations. Prices in South China saw a slight upward movement, driving the overall market to show a steady and tentatively rising trend. However, the overall increase was limited and did not form a comprehensive upward pattern.

2) Supply factors: In January, the capacity utilization rate of domestic POM was 81.74%, an increase of 2.23% compared to the same period last month. The overall operating rate of the industry slightly improved, and the supply side as a whole was relatively abundant. Although the shutdown and maintenance of the first-phase POM unit of Yankuang Luhua led to a short-term supply contraction, it did not change the overall abundant supply pattern, and the positive support for the market was limited. At the same time, combined with the overall atmosphere of the current chemical industry, the rise in the price of key raw materials such as propylene oxide has brought a certain degree of sentiment boost to the sector, but it has not directly transmitted to the POM supply side to form substantial support.

3) Profit factor: In January, the cost profit of the domestic POM industry was 602 yuan/ton, an increase of 77 yuan/ton compared to the same period last month, and the industry's profitability improved slightly. The profit increase was mainly due to manufacturers' proactive increase in ex-factory prices, while cost pressures did not increase significantly, which to some extent enhanced manufacturers' willingness to support prices and became one of the important supporting factors for the market's tentative rise this month.

IV. Next Month's Market Forecast

The domestic POM market is expected to show a wait-and-see and consolidating trend in February, with limited overall fluctuations and difficulty in forming a clear unidirectional trend. This is mainly due to the Spring Festival holiday, which will lead to a quieter market.

In phases, during early February, as the Spring Festival holiday approaches, businesses will successively enter the final stage of stocking up. The trading atmosphere in various markets will gradually become subdued. Petrochemical plant inventories will continue to accumulate, leading to increased pressure on shipments, while terminal factories will progressively cease operations for the holiday. User replenishment demand will significantly decrease, and traders will show little interest in operating, resulting in few actual market transactions.

Mid-month marks the official start of the Chinese New Year holiday, with market participants withdrawing from the market for vacation. No restocking activities are observed across various regions, and mainstream quotations are expected to remain stable. There are virtually no actual transactions in the market, and the overall situation is stagnant.

In late February, after the Spring Festival holiday, petrochemical plants will continue to have high inventories, leading to significant short-term sales pressure. However, some traders have not yet returned to the market, and inquiries are scarce in various regions, leaving the market without effective upward momentum. At the same time, downstream factories have not yet fully resumed operations, and users are mostly adopting a wait-and-see attitude, making it difficult for actual orders to materialize.

Overall, the POM market in February lacks clear positive support. Demand is unlikely to drive growth, and supply-side pressure persists. It is expected to maintain a wait-and-see consolidation trend with limited fluctuations.