Organic Chemicals Cooled Down

Phenol

In June 2007, China's phenol price increased stably at first and
dropped afterwards.
   When the price of phenol reached over RMB16 500/t, the demand
for phenol in downstream sectors reduced because the phenol
users can not afford the high cost of raw materials, the price
of phenol began to decrease slightly.
   As of June 29th, 2007 the bulk trading price of phenol was
at RMB15 800/t in the ports of East China, a rise of RMB500-600/t
over a month before, and in other regions of China, the bulk
trading prices rose RMB200/t to RMB15 600-15 800/t.
   In July 2007, the demand for phenol in downstream sectors will
continue to shrink, and the price of phenol will still decrease.
However, due to the high price of imported product, it is
impossible for the price to drop drastically.

Acetone

In June 2007, due to some downstream sector experienced seasonal
demand slack, the demand for acetone dropped considerably, and
the price of acetone in domestic market decreased slightly.
   As of June 29th, 2007 acetone was traded at RMB8 750-8 900
in the ports of East China, a drop of RMB100-150/t from the same
period of last month, and in South China the bulk trading prices
was RMB9 300/t, basically the same as those in a month before.
   In July 2007, the demand for acetone in downstream users will
still be slack, and the price of acetone will probably drop
slightly.

MEG

In June 2007, due to the low operating rate of downstream
polyester plants, the price of MEG (mono ethylene glycol)
dropped considerably.
   In the end of June 2007, the price of MEG once increased
slightly, however, due to the demand shrink for MEG in the
downstream users, the price stopped to rebound.
   As of June 28th, 2007 MEG was traded at RMB8 500-8 550/t in
East China, a drop of RMB300/t from a month before, and the offer
price of imported goods decreased US$45/t to US$930/t CFR China.
   In July 2007, some downstream plants will increase their
inventory of raw materials, however, the demand shrink for MEG
will not change fundamentally. It is expected that the price of
MEG will still decrease slightly.

Diethylene glycol

In June 2007, due to the algae pollution in Taihu Lake, some
downstream plants, located in Taihu Lake, suspended production
for rectification and led to the demand shrink for diethylene
glycol. The price of diethylene glycol therefore dropped
drastically.
   As of June 28th, 2007 the bulk trading price of diethylene
glycol was at RMB9 220-9 320/t in East China, a drop of RMB1 300-1
360/t from the same period of last month, and the offer price
of imported goods decreased US$100/t to US$1 030-1 050/t CFR
China.
   It is expected that the price of diethylene glycol will
probably continue to decrease in short term, and the price will
unlikely to rebound unless the operating rate in downstream
plants increases apparently.    

PTA

In June 2007, due to the slack demand for textile, the price of
polyester decreased constantly, and the polyester producers
reduced their operating rate to resist high price of raw
materials. Due to the demand decrease for PTA (pure terephthalic
acid) in polyester sector, the price of PTA dropped
considerably.
   As of June 29th, 2007 PTA was traded at RMB8 330/t in East
China, a drop of RMB350/t from a month before.
   In July 2007, the demand for textile will still be slack,
however, due to the price rise of crude oil, the price of PX
(para-xylene) will rebound, and the price of PTA will probably
increase slightly.