According to a research report, in January 2026, chemical product prices continued to rise and price spreads widened further. This trend was driven by tightening supply-demand dynamics, rising upstream raw material costs, and strong market sentiment. Notably, the spreads for butadiene, PDH, urea, and PTA expanded considerably compared to the previous month. Specifically, the butadiene spread reached 4,630 yuan per ton, up 65% month-on-month; the PDH spread was $48 per ton, also increasing by 65%; the urea spread stood at 411 yuan per ton, rising 44%; and the PTA spread was 1,006 yuan per ton, up 22%. These conditions may present investment opportunities for related companies.
The main points of the analysis are outlined below.
Butadiene experienced tightening product supply and demand, which pushed prices higher. After December 2025, some butadiene producers halted external sales, and supply tightened further due to reduced availability from South Korea. Concurrently, downstream demand improved gradually, with operating rates for polybutadiene rubber and styrene-butadiene rubber continuing to increase, supporting the ongoing rise in butadiene prices. In January 2026, the butadiene spread was 4,630 yuan per ton, a 65% increase from December.
For PDH, numerous enterprises underwent shutdowns for maintenance, leading to a continued expansion of the spread. In December 2025, due to rising propane prices, the PDH process recorded an average theoretical loss of 992 yuan per ton, making it the least economically viable method for propylene production. Consequently, several companies finalized maintenance plans, entering a scheduled maintenance cycle in January. Beyond the planned maintenance, some PDH units in Shandong and East China experienced unexpected shutdowns. The resulting supply-demand mismatch created procurement needs for propylene among integrated enterprises, driving propylene prices upward. In January 2026, the PDH spread was $48 per ton, up 65% month-on-month.
Urea producers faced high demand for pre-holiday orders, with inventories remaining at low levels. In January 2026, strong demand for Spring Festival orders and low grassroots inventory levels bolstered market sentiment, leading to sustained price increases for urea. The urea spread for the month was 411 yuan per ton, an increase of 44%. It is anticipated that after the Spring Festival, demand from agriculture for返青肥 and industrial consumption will gradually recover and strengthen, providing continued solid support for the market. Domestic urea prices are expected to remain firm.
PTA prices were primarily driven higher by cost factors. In January 2026, geopolitical tensions caused international crude oil prices to fluctuate and rise, strengthening cost support for PTA. Meanwhile, actual production reduction plans in the polyester sector began to take effect in late January, offering some positive support to the upstream market earlier on. Driven by these cost pressures, the PTA spread continued to widen. In January 2026, the PTA spread reached 1,006 yuan per ton, up 22% from the previous month.
Investors should be aware of risks, including significant fluctuations in crude oil prices and potential policy outcomes falling short of expectations.