In mid-November, China's TDI market gained momentum with prices showing a strong upward trend. This represented a notable increase from the early November , recording a weekly rise of 2.64% and a year-on-year increase of 10.77%. The core drivers behind this market warming were a combination of supply tightening and cost support, creating a strong bullish sentiment in the market.
Supply tightening emerged as the dominant factor: Multiple domestic plants faced operational constraints. Wanhua’s TDI plant in Fujian continued to operate at reduced rates, Covestro’s Shanghai plant commenced its scheduled maintenance in November, and Hanwha Solutions’ 150,000 t/y TDI plant in Korea underwent maintenance starting November 3 (expected to restart around November 20). These factors significantly reduced market supply. Major producers maintained a firm stance on prices; a key Shanghai-based producer raised its offer to 14,400 RMB/ton and implemented restricted sales, while a northern producer adopted a "fixed price of 14,200 RMB/ton + 20% supply allocation" model. Some companies suspended sales due to low inventories, and traders were reluctant to sell at lower prices, making low-priced spot material scarce in the market.
Cost support continued to strengthen: International crude oil prices fluctuated upward due to potential supply risks from the Russia-Ukraine conflict, with the NYMEX crude December contract rising 2.39% for the week. This pushed the upstream toluene market to stabilize with a firm bias; toluene prices in Jiangsu increased by 120 RMB/ton to 5,375 RMB/ton during the week. The cost pass-through effect gradually became evident, providing fundamental support for TDI price increases. Meanwhile, export performance remained robust; China’s cumulative TDI exports from January to September reached 405,800 tons, a year-on-year increase of over 62%. Sustained overseas demand continued to absorb domestic supply, further alleviating supply pressure.
Demand was characterized by "predominantly rigid demand with resistance to high prices": Downstream industries such as sponges and curing agents were in their traditional low season. Enterprises primarily made small purchases based on immediate needs, with limited sustainability in new order placements. Significant resistance to high-priced material somewhat curbed price increases, resulting in a "slow but steady rise" in the market. In terms of regional price differences, quotations in East and South China were relatively concentrated. Shanghai material commanded a higher price than domestic material due to tighter supply, with the overall price differential maintained within 500–800 RMB/ton.
Looking ahead, the industry expects the TDI market to maintain its firm trend in the short term: Maintenance-related supply reductions are not yet fully resolved, major producers remain determined to support prices, and cost support from crude oil and toluene is likely to persist. However, the slow pace of demand recovery and the continued inhibitory effect of high prices on procurement may limit the momentum for further significant price increases. Downstream enterprises are advised to stock up according to their needs, closely monitoring the restart progress of Hanwha Solutions’ plant in late November, the implementation of Covestro’s maintenance schedule, and the follow-up strength of downstream demand.
