ABS Recent Market Intelligence Report

I. Price Trends
- **Current Prices**: As of May 25, 2026, the spot reference price for ABS stands at RMB 10,666.67 per metric ton; the three-month average price is RMB 11,387.88/ton, with a three-month high of RMB 14,233.33/ton and a low of RMB 8,926.67/ton.
- **Price Volatility**: Since mid-May, ABS market prices have declined across the board amid broad-based weakness. Although raw material prices have softened, the cost-support effect has been limited. Downstream terminal demand—particularly from the home appliance sector—has entered its seasonal lull, resulting in an evident oversupply situation industry-wide. Trading sentiment remains subdued, and end-user purchasing intent is weak.

II. Supply-Demand Dynamics
- **Supply Side**:
- **Production Volume**: Industry output increased this week, while petrochemical plant inventories rose slightly.
- **Plant Operations**:
Liaoning Jinfa ABS plant (600,000 tons/year capacity) is currently operating at full load;
Lihuayi Lijin ABS plant (two production lines, 400,000 tons/year total capacity): M347 line is running at full capacity, while AG120 line remains shut down;
Sinopec Ineos Styrolution ABS plant (600,000 tons/year capacity) is operating at below 50% overall load;
Dalian Hengli Petrochemical ABS plant (300,000 tons/year capacity) is fully shut down for maintenance;
Shanghai Gaoqiao ABS plant (300,000 tons/year capacity) underwent shutdown of one production line in early May and is currently operating at below 70% overall load.
- **Demand Side**:
- **End-User Procurement**: Purchasing activity remains sluggish due to seasonal weakness; market transaction sentiment is depressed, and end-users exhibit low procurement enthusiasm. ABS distributors largely hold bearish outlooks.
- **Downstream Industries**: Home appliances, automotive, and electronics/electrical sectors constitute the core demand pillars for ABS—with home appliances accounting for over 50% of total demand. In 2026, the stimulus effect of China’s “trade-in old appliances for new” policy has weakened, while ongoing adjustments in the real estate market continue to suppress incremental demand for home appliances. Meanwhile, automotive exports are expected to sustain robust growth, providing some support for automotive-grade ABS demand; however, high-end grades remain heavily reliant on imports.

III. Import-Export Situation
- **Imports**: In April 2026, China’s total import volume of primary-form ABS amounted to 68,500 metric tons, down 12.40% month-on-month.
- **Exports**: In April 2026, China’s total export volume of primary-form ABS reached 56,600 metric tons, up 31.67% month-on-month.

IV. Cost Structure
- **Raw Material Prices**: ABS production costs are primarily driven by styrene, acrylonitrile, and butadiene. Recent declines in raw material prices have delivered only limited upward support to ABS costs.
- **Raw Material Markets**: Following rapid capacity expansion, styrene industry growth has moderated; reduced new supply pressure helps the market seek rebalancing. However, relatively weak upstream benzene supply-demand fundamentals may constrain styrene price upside. The butadiene market is expected to remain relatively stable, posing manageable cost pressure on ABS.

Analysis & Assessment

I. Price Trend Analysis
- **Short Term**: Influenced by seasonal weakness in end-user procurement, industry-wide oversupply, and declining raw material prices, ABS market prices are likely to continue trending downward in a volatile manner over the near term.
- **Medium Term**: With increasing reports of domestic ABS plant shutdowns and maintenance activities in Q2, overall output is expected to contract significantly. As low-price profit-taking positions are gradually absorbed, the market’s floor level may rise modestly. Thus, ABS pricing retains some potential for stabilization and upward adjustment—but a sustained, unilateral rally appears unlikely. Instead, prices are more likely to consolidate within a range before gradually edging higher.

II. Supply-Demand Analysis
- **Supply Side**: Although recent output has risen, multiple plants are undergoing shutdowns or maintenance, and the pace of new capacity commissioning has notably slowed—easing the previously excessive supply surplus. Nevertheless, the substantial capacity added earlier still requires time for digestion; an oversupplied market is expected to persist throughout 2026.
- **Demand Side**: Demand growth from downstream sectors—including home appliances and automotive—is decelerating. Specifically, home appliance demand faces headwinds from diminishing policy stimulus and continued softness in the real estate sector. While strong automotive export performance provides partial support for vehicle-grade ABS, the persistent reliance on imported high-end grades highlights the need for domestic producers to enhance global competitiveness.

III. Cost Structure Analysis
- Declining raw material prices offer only marginal cost relief for ABS producers. However, relative stability in the styrene and butadiene markets suggests that cost-related shocks will remain contained. Still, industry-wide profitability remains suboptimal: leading enterprises—backed by technological advantages and established customer relationships—may retain narrow profit margins, whereas small- and medium-sized enterprises face severe operational challenges.

Outlook & Forecast

I. Price Forecast
- **Short Term**: ABS market prices are likely to remain under downward pressure in a volatile pattern, though further declines are expected to be limited.
- **Medium Term**: As output contraction accelerates and low-cost inventory positions are liquidated, the market’s base price level may gradually strengthen—leading to a sideways consolidation phase with a mild upward bias.
- **Long Term**: Should external macroeconomic conditions stabilize and downstream demand show signs of recovery, ABS prices could stabilize and rebound. Conversely, persistently weak demand coupled with sustained oversupply would keep ABS prices under continuous pressure.

II. Supply-Demand Forecast
- **Supply Side**: The pace of new ABS capacity deployment is projected to remain slow going forward, allowing the supply glut to gradually ease. However, absorption of previously commissioned large-scale capacity will take time; thus, structural oversupply is unlikely to resolve fundamentally in the short term.
- **Demand Side**: Slowing demand growth in key downstream industries—such as home appliances and automotive—is expected to become the new norm. Yet, robust automotive exports and growing opportunities for import substitution in high-end ABS grades will provide tangible support for overall demand. Domestic manufacturers must increase R&D investment to enhance product performance and quality—thereby better meeting the stringent requirements of high-end applications.