Plastic, Silicone, Steel, and Others: Updated China Raw Materials Costs (late Sep ’24)

Here’s the monthly update tracking the costs of commonly used raw materials from China for the past year to help you understand where the market is right now. If you or your supplier are purchasing materials from China for your products, the cost changes you see here impact your bottom line!

Here’s the up-to-date material cost data from China for you as of late September 2024 and the price evolution over the past twelve months – this month silicone, zinc and aluminum alloys are up, while batteries and PVC are down a little.

Here you can see the individual cost evolution per material over the past year, including the weekly and monthly changes for September 2024 with costs in CNY:

Here is what the external market analysts we work with attribute these changes to during this past month and the monthly cost change:

Epoxy Resin – increased by 0.58%

The price of epoxy resin is expected to fluctuate slightly soon due to the following factors:

• Supply: A tight supply of epichlorohydrin (ECH) remains, with some downstream stocking ahead of the (October) holidays in China.
• Demand: The negotiation atmosphere remains dull, with market activity stable and narrow fluctuations in price negotiations.
• Cost: Most products in the epoxy resin chain have seen prices rise, except for bisphenol A and PC, which fell slightly. Improved acetone market transactions contributed to a 1.40% price increase.
• Outlook: Profitability has slightly improved, but the overall outlook for the industry chain remains pessimistic.

ABS (Acrylonitrile Butadiene Styrene) – decreased by 0.94%

The ABS market is expected to remain stable with minor fluctuations due to the following factors:

• Supply: Production levels dropped to 61.17%, with slight decreases at Zhangzhou Chi Mei and Tianjin Dagu plants. Northern Huajin restarted production.
• Demand: Stable but moderate, with the addition of Zhejiang Petrochemical’s new plant (300,000 tons/year) not yet reflected in the data.
• Cost: No significant cost updates this week.
• Outlook: Production capacity remains healthy, with minor fluctuations in demand and supply.

Silicone – increased by 2.08%

Silicone prices are expected to remain stable in the near term, driven by the following factors:

• Supply: Supply pressure varies across enterprises, leading to differentiated prices and order volumes.
• Demand: Limited purchasing interest due to the high cost of rubber transfer.
• Cost: Prices for raw rubber first increased by 200 yuan/ton but then loosened due to lack of follow-up from major producers.
• Outlook: The market remains divided, with some enterprises reducing shipment prices while others maintain higher levels.

Zinc Alloy – increased by 4.10%

Zinc alloy prices are expected to remain volatile due to the following factors:

• Supply: Smelters announced joint production cuts in mid-September due to raw material shortages, tightening supply.
• Demand: Demand release has been lower than expected, contributing to weaker market sentiment.
• Cost: Zinc prices fluctuated significantly in the third quarter, driven by poor macroeconomic data and reduced market confidence.
• Outlook: In the fourth quarter, prices are expected to fluctuate at high levels, with an initial rise followed by a decline, supported by policy measures and tightening supply.

Aluminum Alloy (AL Alloy) – increased by 3.14%

Aluminum alloy prices are expected to remain strong and volatile due to these factors:

• Supply: Stable production at electrolytic aluminum smelting plants, with rising inventory levels being gradually reduced.
• Demand: Marginal improvements in demand, particularly due to pre-holiday stockpiling and rising aluminum processing requirements.
• Cost: Strong domestic aluminum prices and a rising international aluminum market due to favorable macroeconomic conditions.
• Outlook: Prices are expected to remain strong and volatile, supported by macroeconomic factors.

PVC (Polyvinyl Chloride) – decreased by 2.84%

PVC prices are likely to remain under pressure due to the following reasons:

• Supply: Limited improvements in supply fundamentals.
• Demand: Weak, with only slight support from macroeconomic conditions.
• Cost: Cost support remains at the lower end, with fundamental support insufficient.
• Outlook: Uncertainty persists regarding the sustainability of macroeconomic support after the holidays. The market is expected to continue to face supply and demand challenges.

Paper for Color Boxes – no change

The price of double-coated paper is expected to remain stable, driven by the following factors:

• Supply: Paper mill offers remained stable, providing slight support to market confidence.
• Demand: Weak downstream purchasing enthusiasm, with dealers showing little incentive to cut prices due to profit pressure.
• Cost: Mixed pulp price trends, with broadleaf pulp prices falling, negatively affecting paper prices.
• Outlook: The market remains stable, though individual regions saw slight price drops.

Paper for Cartons – decreased by 1.84%

The carton paper market is likely to see continued price decreases due to these factors:

• Supply: Balanced supply and demand early in the month, but consumption dropped mid-month, creating supply pressure.
• Demand: Weak demand during the typical peak season, with reduced orders after the Mid-Autumn Festival.
• Cost: No significant changes reported.
• Outlook: Prices are expected to continue declining as supply pressure increases.

Stainless Steel – decreased by 0.62%

Stainless steel prices are expected to fluctuate in line with market sentiment for the following reasons:

• Supply: Production levels remain high, but declining futures and spot prices have affected market confidence.
• Demand: End users continue to purchase only on an as-needed basis.
• Cost: Rising nickel prices provided some cost support, but overall trading activity remains subdued.
• Outlook: The market is cautiously optimistic, with potential boosts from macroeconomic policy changes, but sentiment remains wait-and-see.

Lithium Batteries – decreased by 3.33%

Lithium battery prices are expected to remain stable, driven by the following factors:

• Supply: Stable supply, with reference prices for lithium cobalt acid ranging between 130,000-150,000 yuan/ton.
• Demand: Market transactions remain in line with normal downstream production levels.
• Cost: Weak support on the cost side, with little variation in pricing trends.
• Outlook: The lithium battery market remains steady, with no significant changes expected.

How to combat rising costs?

Explore cost-reducing tips in this post: Rising Raw Material Prices: What Strategy To Follow? (6 Approaches).

What to do if your Chinese supplier suddenly tells you that material costs have risen: How To Cooperate With Your Chinese Supplier, Part 16: Bad News from China, Raw Material Prices Just Increased!

If your supplier just isn’t working out, maybe sourcing a new supplier will help you find one who can offer you better prices and more. If so, there’s no need to fear switching from your current supplier to a new one if you’re prepared: How To Switch To A Newer, Better Chinese Manufacturer? [eBook].

We hope this is helpful. Our mission at Sofeast is to help importers have transparency in their supply chain and to give them more control. And this information is critical to have some visibility into your manufacturer’s costing.

By the way, you can always contact us if you have any questions about whether a manufacturer’s quote is reasonable.