China acetic acid price has been hiking since Aug, up from 3,000yuan/mt in the beginning of the month to 3,900yuan/mt as of Aug 24. The profit has widened to 1,360yuan/mt in Aug, back to above 1,000yuan/mt after one year. The driving force comes from unexpected issues of acetic acid plants, reduction of supply, as well as inventory at record low.

Product inventory at acetic acid plants hovered high at around 150kt in the first half of 2023. Since Jun, some plants in East China were shut intensively, with average operating rate down to 60%, leading to continuous reduction of product inventory. In Jul, the restart progress of acetic acid plants was slower than expected. Inventory maintained low with limited commercial supply available. In Aug, under the high temperature and rainy season, several plants were shut unexpectedly, with average operating rate down to around 70%. Product inventory further decreased to hit this year's new low of 80kt.