Liquid oxygen:

This week (December 6–12, 2024), the liquid oxygen market has been characterized by weak volatility, with subdued demand and localized price declines. As of December 12, 2024, the average price of liquid oxygen in China stood at RMB 390 per tonne, down 0.26% from the previous week but up 1.03% year on year.

From the supply side, this week Air separation Operations have remained relatively stable, with steady liquid oxygen production; manufacturers’ shipments are moderate, and inventories have increased. On the demand side, more steel mills in northern China are cutting output, leading to a general decline in blast-furnace operating rates and weaker liquid-oxygen demand, resulting in localized price reductions.

On the supply side, current low liquid-oxygen prices have pushed some fully liquefied air-separation units into losses, raising the prospect of production shutdowns in the near term. In addition, with blast-furnace closures at steel mills, their associated air-separation units are likely to halt operations as well, leading to a sustained decline in liquid-oxygen output. On the demand side, as year-end approaches, construction activity has slightly slowed, and most regions in northern China have entered winter shutdowns, putting increasing pressure on end-user demand. Direct-supply volumes are also falling more rapidly, keeping short-term demand at low levels. Steel-mill margins continue to be squeezed, which could further reduce supply, maintaining a weak balance between supply and demand. Looking ahead, liquid-oxygen demand is expected to remain weak. In summary, Longzhong Data forecasts that, amid the off-season, the liquid-oxygen market will likely remain stable but trend downward.

Liquid nitrogen:

This week (December 6–12, 2024), there have been no large-scale maintenance shutdowns in the upstream liquid nitrogen market, resulting in stable supply and balanced demand across most regions. Local demand has improved, leading to modest price increases, while in some areas the initial demand-driven gains have faded, causing prices to give back earlier gains. Overall, the market has shown mixed movements, with average prices declining. As of December 12, the national average price of liquid nitrogen stood at RMB 407 per tonne, down 1.04% month-on-month and 8.80% year-on-year.

Supply Forecast: Next week, the liquid nitrogen market in East China will see some maintenance activities, while most other producers will operate normally, resulting in ample supply and a generally bearish supply-side outlook.

Demand Forecast: Traditional downstream demand remains stable, with Shandong continuing to place small orders. Although maintenance is underway in East China, there is no significant increase in order intake, and the liquid nitrogen market has entered the off-season, with bearish market sentiment dominating.

Overall, the short-term liquid nitrogen market is characterized by ample supply and weak demand across most regions, with no new, confirmed purchase orders. Under these supply-demand imbalances, the market is expected to remain dominated by narrow downward price movements in the near term.

Liquid argon:

This week (December 6–12, 2024), liquid argon prices have been trading in a consolidating range, with limited purchasing enthusiasm among downstream users and a generally subdued trading atmosphere. Upstream supply remains relatively ample, with few reports of planned maintenance recently. Demand has shown only modest improvement, as downstream buyers remain cautious; downward price pressure has led to reduced restocking volumes. As the year-end approaches, market demand remains weak, upstream inventory levels are trending upward at a slower pace, and downward pricing pressure is mounting.

Overall, the supply-demand imbalance is quite pronounced, further squeezing production margins; until new directional guidance emerges in the news flow, it will be difficult for prices to show any signs of a rebound.

Looking ahead to next week, it is unlikely that demand will show any significant improvement. Meanwhile, upstream supply remains ample, and as shipments slow, liquid levels at the top end have risen markedly. At present, a downward price trend appears inevitable in the market; however, as margins on air separation products continue to shrink, supply-side constraints could eventually provide some support.

Carbon dioxide:

This week (December 6–12, 2024), the national average price of carbon dioxide was RMB 328 per tonne, down 0.61% from the previous week and 2.96% year on year. Carbon dioxide prices remained largely stable this week, with some provinces reporting price reductions. Trading activity in the carbon dioxide market was moderate, reflecting weak downstream demand. Increased supply this week put upward pressure on storage capacity at some producers, with storage utilization rising by 0.59 percentage points from the previous week. Meanwhile, carbon dioxide capacity utilization increased by 1.40 percentage points week on week.

Next week, the national average price of carbon dioxide is expected to decline slightly. Capacity utilization is forecast to fall, leading to a reduction in supply, while downstream demand is likely to remain at last week’s level, with no immediate positive factors in sight. On the market front, carbon dioxide prices will be influenced by cost pressures and are expected to drop only modestly, to around RMB 327 per tonne. By late December, as colder weather sets in and demand for applications such as oilfield well injection declines, producers whose prices fall below cost will either suspend operations to release existing inventory or halt production altogether. With costs stabilizing at a bottom, the average market price for carbon dioxide in late December is projected to be approximately RMB 326 per tonne.

Source: Longzhong Information