The Acetic Acid market in January 2025 continues to grapple with high supply levels and uneven regional demand. Domestic production capacity utilization remains elevated, contributing to ample supply. With new capacity expansions planned for later in 2025, including an additional 5.9 million tons in China, concerns about overcapacity are intensifying. This growing supply surplus is expected to weigh heavily on the market, creating a challenging environment as the year progresses.

In January, China’s Acetic Acid trade performance highlighted contrasting dynamics. Import volumes have remained subdued compared to the same period last year, reflecting weaker domestic demand for imported material. Meanwhile, exports continue to grow robustly, driven by competitive pricing and the need to manage domestic Acetic Acid oversupply. Acetic Acid Export activity has provided critical support to the market, but reliance on external markets raises questions about sustainability in the face of global economic uncertainties.

Regionally, the market exhibited notable variations in January. In North China and Shandong, downstream pre-Lunar New Year stocking activity was lacklustre, limiting enterprise shipments and creating regional supply pressures. However, East and South China experienced more stable trading conditions, with long-term contracts dominating market activity. This contrast underscores the fragmented nature of the current market and the challenges faced by suppliers in aligning with varying regional demand trends.

The upstream methanol market showed volatility in mid-January, which influenced Acetic Acid costs. Early in the month, methanol prices strengthened, supported by rising crude oil prices, but they later softened as trading activity weakened. This fluctuation in feedstock prices has had a ripple effect on Acetic Acid market sentiment, creating additional uncertainty for producers and buyers alike.

Downstream acetic anhydride market maintained balanced supply-demand conditions, with moderate improvements in trading activity. However, downstream industries such as PTA and acetate esters are focusing on long-term production stability rather than significant short-term growth, further limiting immediate demand support for Acetic Acid. While capacity expansions in these sectors are expected later in the year, their impact on demand is not anticipated to materialize until much later.

Looking ahead, market analysts expect Acetic Acid prices to remain under pressure in the short term. High production capacity utilization and ample supply continue to overshadow incremental demand improvements. Key areas to monitor include downstream production trends, export performance, and potential adjustments in supply allocation. With regional disparities persisting and global market uncertainties looming, January 2025 has set the tone for what could be a volatile year for the Acetic Acid market.

As per ChemAnalyst Database anticipated continued weakness in the Acetic Acid market in the short term. High production capacity utilization and ample supply are expected to outweigh any incremental demand improvements. The market's trajectory will depend on downstream production trends, export market performance, and adjustments in supply allocation as stakeholders navigate ongoing challenges.