The prices for Methyl Ethyl Ketone (MEK) in Asia during the first half of January 2026 were under tremendous pressure to end the decline that started in August 2025. MEK prices decreased last month approximately 2.2% due to low demand and excess supply.
There was a slowdown in trading activity shortly after holidays in China due to a lack of urgency to place new orders among downstream users, who were still awaiting the return of wholesale buyers from holiday breaks.
From the cost side, support remained weak. Prices of C4 raw material after etherification continued to fall due to poor margins in deep processing and low end-user demand. This further reduced production costs but failed to lift MEK prices, as supply continued to exceed consumption.
Upstream crude oil prices also offered little help. Global crude oil prices dropped nearly twenty percent in 2025, as a result of oversupply fears and decreasing demand rates for crude oil. Price reductions in crude oil, placing continuous pricing pressure on methyl ethyl ketone.
The MEK market in China has been oversupplied over the long term. Total effective MEK capacity reached a record high of about 1.097 million tons in 2025, reflecting an increase in capacity, while the supply-demand gap has widened as all the producers operated at normal capacity during this time, resulting in an oversupply of MEK and low-price levels.
According to market sources, a plant expansion that was just newly installed had to shut down two months after opening because of the difficult market conditions. The rapid decline in demand for MEK reflects a very competitive marketplace, where MEK producers have adapted to overwhelming demand by relying heavily on flexible production and maintenance to alleviate production losses.
MEK prices saw only one brief rebound in 2025, mainly caused by unexpected plant shutdowns and concentrated maintenance that reduced spot availability for a short period. Outside of this phase, prices kept falling, even during the traditional peak season of September and October.
Margins for MEK producers remain very low, with average margins in 2025 down nearly 13 percent from 2024. Producers using hydration as their primary production method had to cut their production levels when MEK prices neared the cost of production, and producers of sec-butyl acetate production methods have primarily operated at a loss and shifted production from one location to another when this occurred.
MEK demand in Japan has been low. The performance of paint and coating manufacturers has declined as the level of construction has continued to decrease. Buyers focused on using existing stockpiles and avoided forward buying, keeping market activity thin and prices vulnerable.
According to ChemAnalyst data, MEK prices are likely to remain low in Q1 2026. Planned capacity additions of around 350,000 tons per year in China, combined with weak downstream demand, are expected to delay any recovery, with buyers likely to wait for further price drops before returning to the market.
