sofeast china raw materials price indicesHere’s the monthly update from Sofeast’s sourcing team who has been tracking the costs of commonly used raw materials from China since January 2021 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 that you see here do have an impact on your bottom line!

Here’s the up-to-date material cost data from China for you as of late May 2023 and the price evolution since Jan ’21. Note the monthly cost change, in particular: Material_Cost_2023

This graph shows the cost evolution for one year and as you can see, the costs are stable across all materials, except for batteries, where the cost has reduced drastically over the past 12 months.



The graph below is showing the cost fluctuation from 2021 to date with the maximum, minimum, and averages for each of the materials.


Here is what market analysts attribute these changes to:

Epoxy resin (epoxy refers to E-51) – decreased 1.36%

The epoxy market was quiet this week, with prices moving lower in a narrow range. Raw material bisphenol A continued to trade in a narrow range, while another raw material, epichlorohydrin, weakened slightly. The weak cost support for epoxy resin did not deter the industry, which remained flat.

The demand side of the market was weak this week. The downstream market was not enthusiastic about replenishing inventory, and more buyers were digesting early orders and inventory raw materials. Buying sentiment did not decline, however, and some epoxy resin factories experienced shipment delays. Inventory levels slowly increased, and some liquid epoxy resin plants reduced their plant load. Most solid epoxy resin factories were operating at less than 50% capacity.

The epoxy market is expected to remain flat in the coming weeks. The weak cost support will continue to weigh on prices, and the demand side is not expected to improve significantly.


ABS (AG-15E1) – decreased 9.24%

The pressure of competition among brands is rising, and mainstream factory prices are still mainly reduced. In addition, the weak shock of commodities has made it difficult for the industry to improve its mentality in the short term. Weekly market negotiations focus on small orders of rigid demand, and most downstream factories purchase on demand.

With the price falling to a relatively low historical level, there are more opportunities for new materials to replace recycled materials, and the demand for some opportunities has increased. However, risk aversion exists in the market, and the overall confidence of participants in the game is subdued.


Silicone (110) – decreased 8.07%

The domestic 110 raw rubber market reported some large moves this week, with the volatility space narrowing. Although the downstream rubber market demand continued to be weak, because the mainstream transaction price and raw materials inverted operation of raw rubber, the cost reduction is clear. Production enterprises continue to let the interest become weak in order to hedge losses and inventory pressure, as well as reduce their output. 

Within the week, the downstream orders may just be small single transactions. This week, raw material DMC prices continue to fall, and the raw rubber market cost falling also adds bearishness.


Zinc alloy (Zamak5) – decreased 12.08%

The price of zinc fluctuated and fell mainly due to the following reasons:

  • Macro factors: The US debt ceiling negotiations were uncertain, which led to an increase in the US dollar index and a weakening of market sentiment.
  • Supply factors: Some overseas zinc smelters have resumed production, and imported zinc has entered the market. However, domestic zinc output is not bad, which has increased pressure on the supply side.
  • Demand factors: Domestic demand has entered the off-season, and downstream consumption has gradually weakened. This has weakened the support for the zinc market.


AL alloy (ADC 12) – decreased 2.40%

Spot aluminum prices continue to rebound. Shippers are more willing to ship their goods. The market is seeing increased demand for aluminum near the end of the week. Traders are mainly focused on shipping their goods, while wait-and-see sentiment remains strong. Downstream manufacturers are increasing their demand for aluminum. Overall, the trading atmosphere is fairly normal.


PVC (SG-3) – decreased 8.59%

PVC powder prices continued to fall this week. On the one hand, the falling coal prices led to a general decline in black commodities, weakening the overall commodity sentiment and causing PVC powder prices to follow suit. On the other hand, PVC powder inventories remained high, and fundamental support was insufficient. Additionally, the falling carbon black prices are expected to reduce market transaction costs.


Paper for color boxes (157g) – increased 8.85%

The main factors affecting the price trend are:

  • The publishing bidding price has been on a downward trend this week, which has put pressure on business confidence.
  • Dealers are hesitant to follow up on new orders, and their enthusiasm for operations is low. Some dealers still have the intention to promote orders, but they are only willing to do so at a narrow margin.
  • Paper mills are still flexible in their pricing, and social transactions are limited.


Paper for cartons (AA 120G) – increased 0.47%

The factors that affected the trend of the corrugated paper market this week are as follows:

  • The scale of paper mills in the Tianjin and Shenyang bases reduced their factory offer by 50-120 yuan/ton. This led to a weak trading atmosphere and a downward shift in the transaction center of gravity.
  • The price of waste paper, the main raw material, has partially dropped. This weakened the support for paper prices due to the transmission effect of upstream and downstream products.
  • Downstream purchasing intention weakened under the influence of the mentality of “buy up, don’t buy down”. This led to a gradual increase in the gap between supply and demand.


Stainless steel (304/2B 0.04mm) – increased 0.50%

The stainless steel market fell sharply this week, and the price’s center of gravity continued to move down. The main reason for the decline in the stainless steel market was the continued decline in nickel and stainless steel futures prices.

In the spot market, traders were eager to ship goods and made profits by promoting delivery. End users purchased goods on demand, and the trading atmosphere was weak. The market price adjustment was weak.

Near the weekend, futures prices rebounded intraday, which led to a rebound in some low offers in the spot market. However, the trading atmosphere remained weak.


Battery (Lithium cobalt oxides) – increased 8.38%

Lithium salt

The head enterprises’ cost price is high, and there is insufficient willingness to ship. The buyers’ willingness to accept the current price is low. The market is shrinking. In the short term, the market supply and demand will be in a tug-of-war, and it is expected to remain sluggish.


Cobalt and compounds

The overall domestic supply is sufficient, and the rigid demand support from downstream alloy and cathode materials is limited. The market price is weak. Recently, cobalt sulfate suppliers have had insufficient production enthusiasm, and they are reluctant to sell at a low price. In the long run, the price will tend to fall.


Nickel salt

The recent market may rebound slightly, but it is necessary to pay attention to changes.


How to combat the 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.

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