Sinoright Blog
Melamine Prices Drop Sharply — What’s Driving the Market
At the early stage of the oil price increase, market sentiment turned strongly bullish. Many downstream buyers were concerned about potential supply shortages and rising costs, which led to aggressive purchasing and stockpiling. This wave of buying pushed melamine prices up rapidly in a short period.
However, from a cost perspective, the key raw material—urea—remained relatively stable and did not follow the same upward trend. This indicates that the price surge in melamine was driven more by market expectations and short-term demand spikes rather than actual cost increases.
As oil prices stabilized, the situation began to shift. Earlier bulk purchasing had already absorbed a portion of demand, and buyers became more resistant to high prices. With demand softening and costs staying flat, the high price level became unsustainable. As a result, producers collectively lowered prices, leading to a sharp correction and increased market volatility.
Looking ahead, the future price trend of melamine will largely depend on real demand recovery. Under current conditions—weak demand and limited cost support—the overall price trend is likely to remain downward, gradually returning to levels seen before the oil price increase.
At this stage, it is more important for market participants to focus on demand recovery and inventory levels rather than short-term price fluctuations.
Feel free to share your thoughts on where the market is heading.
