n-Butanol prices in India declined in mid-July due to lower-cost imports from Asia, improved regional supply, and weak demand from the coatings sector amid seasonal construction slowdown and cautious buying.
n-Butanol prices in the Indian market fell by approximately 7.5% in mid-July 2025, reversing the 9.6% increase recorded earlier in the month. The downward correction was primarily attributed to the arrival of competitively priced shipments from China and other Asian markets, which undercut domestic price levels.
According to market participants, Chinese n-Butanol producers implemented successive price reductions during the first ten days of July, with export offers having reduced by RMB 300–400/ton. These adjustments aligned with a broader softening in Asian n-Butanol markets and prompted Indian buyers to adopt a more cautious approach as imported material entered at more competitive levels as market sentiments changed from anxious to cautious.
The bearish shift in market sentiment was further reinforced by a recovery in Chinese production levels. Operating rates at Chinese n-Butanol facilities increased by 3.4%, easing regional supply concerns that had emerged following the operational disruption at Bharat Petroleum Corporation Limited’s (BPCL) Kochi Refinery in June. The fire-related outage had impacted parts of BPCL’s propylene derivatives complex, which includes a production capacity of 212,000 tonnes/year for oxo-alcohols—including n-Butanol, iso-Butanol, and 2-ethylhexanol.
In addition to the inflow of lower-priced cargoes, production economics across Asia improved due to a decline in feedstock propylene costs, which fell by approximately 2.5% in early July. This was supported by improved Propane Dehydrogenation (PDH) unit operating rates across the region, which edged up by 2.32% to reach an average utilization level of 65.7%. The improvement in PDH operations helped reduce upstream pressure on n-Butanol production costs. However, not all of the price correction gains were fully realized in the Indian market, as intra-Asia freight rates surged by 25.5%, which partially limited the extent of decline in import prices
Despite these supply-side developments, demand fundamentals remained weak. The paints and coatings sector, a major downstream consumer of n-Butanol, continued to exhibit sluggish offtake amid muted construction activity and the arrival of early monsoon. India's infrastructure output growth slowed sharply to just 0.5% year-on-year in April 2025—marking the lowest expansion rate in eight months—down from a revised 4.6% in March. Seasonal factors, particularly the early onset of the monsoon, further constrained construction demand and curbed requirements for decorative coatings.
Anticipations of further price corrections are likely to followed as July progresses as comparatively priced Chinese inventories continues to enter the domestic market amidst subdued sentiments from the present monsoon season thus bolstering the expectations of depreciation in the n-butanol prices.
