Sodium formate demand remained the primary factor behind the price decline. Leather processing activity in major regions such as Hebei and Zhejiang slowed after the spring production cycle, reducing sodium formate procurement from tanneries. Meanwhile, construction-related demand weakened as high summer temperatures restricted activity and lowered consumption of sodium-formate-based drilling fluids. Although the emerging battery-electrolyte sector continued to show gradual growth, its contribution remained insufficient to offset weakness in traditional applications. Sodium formate export demand also softened, with buyers in overseas reducing purchases as overseas markets adopted a cautious approach.
Sodium formate supply-side factors further intensified the downward pressure. Lower formic acid prices reduced production costs and improved producer margins, allowing export-oriented manufacturers to maintain stable operations despite weaker demand. Formic acid FOB Qingdao prices declined from $345.00/MT to $320.00/MT during June, reducing input costs by approximately 7.25%. While Luxi Group in Shandong conducted planned maintenance, removing around 16.67 KT of capacity temporarily, overall supply remained comfortable as most producers continued operating normally. Rising coastal inventories increased competition among sellers, encouraging more aggressive pricing strategies to stimulate sales and reduce stock levels.
Sodium formate market remained under pressure through late June as buyers avoided inventory accumulation and purchased only according to immediate requirements. Sodium formate export availability stayed ample, while weaker international demand limited opportunities for producers to improve margins. The combination of high operating rates, sufficient inventories, and limited buying interest kept negotiations focused on lower price levels.
According to Chemanalyst, the sodium formate market is expected to remain under pressure in the near term as comfortable supply and weak downstream demand continue to limit price recovery. Summer heat-related slowdowns in construction activity and cautious leather-sector procurement are likely to restrict demand, although seasonal restocking before October holidays may provide temporary support.
Geopolitical risks and shipping disruptions remain potential upside factors. Any further escalation affecting global logistics could encourage precautionary buying and tighten export availability. However, without a meaningful improvement in leather, construction, or export demand, Sodium formate sellers are expected to face continued challenges in reducing inventories and defending higher prices.
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