The chemical industry has recently witnessed a significant price surge in isobutyraldehyde and its main downstream product, neopentyl glycol. This remarkable increase has drawn attention to market dynamics and supply chain factors influencing pricing.

• Market Dynamics: As of June 12, the market price for isobutyraldehyde in Shandong region reached CNY 12,800 per ton, marking a 3.23% increase from the previous day, a 34.74% rise since the end of May, and a staggering 60% hike since the end of April. Compared to the same period last year, the price has almost doubled, with a 93.94% increase.

• Supply Constraints: The primary reason for the sharp price increase is the tightening of supply. Isobutyraldehyde, a by-product of octanol production, has limited output and has long been in a state of undersupply, creating a seller’s market. With modest growth expectations for octanol downstream, expansion of isobutyraldehyde production has been restricted, leading to a short-term      unresolved shortage in the market.

• Downstream Impact: The rise in isobutyraldehyde prices has also led to a significant increase in the market price of neopentyl glycol. In the East China region, the price of neopentyl glycol has risen to CNY 13,200 per ton as of June 12, a 32% increase since the end of April.

• Outlook: Both isobutyraldehyde and neopentyl glycol have reached their highest price levels for the year. Downstream enterprises face increased cost pressures, focusing on essential purchases. However, with the ongoing supply shortage and factors such as summer maintenance, further price increases are not ruled out.

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