Price trend

According to the data monitoring of business news agency, after nearly a month’s decline, the acetic anhydride market rose again, and the price of acetic anhydride rose again on April 7. On April 7, the price of acetic anhydride was 9533.33 yuan / ton, up 1.96% from 9350.00 yuan / ton on April 1. Acetic anhydride prices take off again, raw material prices are the main driving factors.

Acetic acid price trend

It can be seen from the price trend chart of acetic acid that the price of acetic acid in April changed from the volatile downward trend in March, and the price of acetic acid rose sharply. Shunda acetic acid plant start-up schedule is difficult to determine, Nanjing BP acetic acid plant unexpected shutdown, acetic acid supply is expected to reduce, future acetic acid prices are expected to rise. The price of acetic acid rises, the cost of acetic anhydride rises, and the driving force of acetic anhydride increases.

Market summary and future forecast

Bai Jiaxin, acetic anhydride data analyst of business society, believes that affected by the decline of acetic acid enterprises, the price of acetic acid stops falling and rebounds, the price of acetic acid rises again, the cost of acetic anhydride rises, the price of acetic anhydride is facing the pressure of soaring again, and the market of acetic anhydride takes off again. In the future, the cost of acetic anhydride remains high, and the demand for acetic anhydride is relatively stable. With the rising cost of acetic anhydride, the price of acetic anhydride is bound to rise again. Acetic anhydride market rose in the future.

Since April 2020, the chemical industry market has been full of momentum and rising. Especially in 2021, the chemical industry market will soar to a ten-year “high” in March. According to the monitoring of the business community, the chemical industry index on March 10, 2021 was 1049 points, a record high in the cycle, up 75.42% from the lowest point of 598 points on April 8, 2020. (Note: period refers to 2011-12-01 to now).

In terms of price, according to the monitoring data of business news agency, in the list of commodity price rise and fall in the first quarter of 2021, there were 83 kinds of commodities in the chemical industry sector, among which 71 kinds of commodities increased by more than 5%, accounting for 77.2% of the number of commodities monitored in the sector; the top three commodities increased were 1,4-butanediol (139.84%), bisphenol A (100.38%) and lithium carbonate (73.60%).

There were only 7 kinds of commodities with a month on month decrease, and 4 kinds of commodities with a decrease of more than 5%, accounting for 4.3% of the number of commodities monitored in this sector; the top 3 products with a decrease were hydrochloric acid (- 31.30%), hydrogen peroxide (- 27.51%) and polyaluminum chloride (- 6.63%). The average rise and fall in the first quarter was 20.48%.

The extremely cold weather restricted the production of crude oil in the United States. The price of crude oil soared to a new high in the past 14 months, boosting the chemical market. At the same time, under the background of the epidemic, the overseas epidemic repeatedly led to the continuous shutdown and supply interruption of chemical plants, and the decrease of global supply expectation was continuously spread, which led to the increase of overseas order demand of domestic factories. In addition, factors such as over issuance of money, asset inflation and loose policy have all provided sufficient energy for the market’s highest point savings.

1,4-butanediol (139.84%)

In the first quarter, the BDO market showed a trend of callback after a sharp rise. Supported by various favorable factors, such as supply reduction, transportation restriction, downstream bullish position compensation, the booming black horse PBAT market in the industry and the sharp increase in demand, the domestic BDO rise can be described as “out of control”. According to the sample data monitored by the business association, as of March 1, the average price of domestic BDO producers was 31750 yuan / ton, with a month on month increase of 133.46% and a year-on-year increase of 228%. BDO rose in a straight line with the market quotation, and the market sentiment continued to rise in a short time. In February, the domestic BDO market was “leading the way”, but in March, the domestic BDO market was “turning upside down”, and the ladder declined, but the range was not large.

On March 31, the average price of domestic BDO producers was 30700 yuan / ton, with a decrease of 3.31% and a year-on-year increase of 225.21%. In March, the bearish sentiment of domestic BDO market continued to intensify, and the price fell from a high level. However, supported by the prominent contradiction between supply and demand, the decline was limited.

Bisphenol A (100.38%)

Since 2021, the domestic market of bisphenol A has soared by 116%. According to the monitoring data of business news agency, the average market offer was 12725 yuan / ton on January 4, and the market offer was 27500 yuan / ton as of April 2, with an increase of 116.11%. At present, the inventory of bisphenol A in the market is low, so it is difficult to find one product. Under the background of bull market, the upsurge of upstream and downstream of the industrial chain helped the market of bisphenol a go up; under the tight supply of goods, the terminal demand continued to improve, especially under the stimulation of terminal wind power industry demand, with sufficient orders and queuing up for delivery, the demand of coatings, new materials and other industries increased in the later stage, and the demand for raw materials was stable. Near the end of the quarter, the supply of goods is limited and there is no intention to make profits. Under the sustained high price, the market transaction is weak, but the short-term shortage of goods is still the main tone of the market, and the short-term market will still run at a high level. In the later stage, as the industry gradually callback, the terminal transfer of high cost is weak, bisphenol A will gradually return to the rational range.

Lithium carbonate (73.60%)

As shown in the figure above, the lithium carbonate market showed a phased unilateral upward trend in the first quarter, with an overall increase of 73.6% in the first quarter and a year-on-year increase of 99.08%. Since the beginning of December last year, the supply of lithium carbonate has been in short supply. Many manufacturers are basically out of stock. The market is tight and the price is rising. The following first quarter was the spring holiday. In view of a small amount of replenishment from downstream orders, the factory pushed the market upward again. However, in view of the shortage of replenishment due to cost pressure, the terminal demand continued to rise and the contradiction between supply and demand continued to intensify after the festival in the context of the bull market of bulk chemical industry. The rise of lithium carbonate in the first quarter was astonishing. In the near future, the market demand is stable, the downstream enterprises are basically in the state of just purchasing, and the price rising trend is slightly weak. It is expected that the price of lithium carbonate may continue to be high in the short term.

The opening of combustion and explosion chemical market in 2021

The chemical market rose well in the first quarter. Although it showed a downward trend at the end of the quarter, analysts from business news agency believed that the short-term correction was mainly due to the cost pressure transmitted by the high price industrial chain, but overseas demand will eventually return to the road of China’s recovery. In the post epidemic era, domestic and foreign demand will pull the domestic market, and the chemical market in the second quarter may still be worth looking forward to. The marginal improvement of demand in 2021 mainly comes from overseas, and various monetary and policy stimulus will drive the chemical sub industry to further boom. The epidemic situation may reshape the global chemical supply pattern, and the global market share of China’s chemical industry will accelerate to increase. China’s chemical industry leader will meet the historic development opportunity.

According to the data monitored by the business agency, the average ex factory tax price of domestic light potassium carbonate was 6575.50 yuan / ton at the beginning of this week, and the average ex factory tax price of domestic light potassium carbonate was 6687.75 yuan / ton at the end of this week, up 0.75%. The current price is up 0.94% month on month, and the current price is up 5.73% compared with last year.

Recently, the domestic potash market continues to rise, and the potash market has been in short supply. Most of them are concentrated in the hands of large traders. They are reluctant to sell. The downstream market purchases on demand. The trading atmosphere of potash market is acceptable, and the market is rising. According to the statistics of the business society, the mainstream ex factory quotation range of domestic industrial grade potassium carbonate this week is about 6550-6900 yuan / ton (the quotation is for reference only), and the quotation is different according to the different procurement situation.

Recently, the quotation of potassium chloride mainstream manufacturers is at a high level: on April 2, the potassium chloride equipment of Qinghai Salt Lake Potash Fertilizer Co., Ltd. operated normally. The ex factory quotation is about 2210 yuan / ton, the quotation is temporarily stable, and the actual transaction price is mainly through negotiation. On April 2, Anhui Badou Chemical Co., Ltd. quoted about 2550 yuan / ton for potassium chloride distribution, which was temporarily stable. The actual transaction price was mainly through negotiation. Recently, the potassium chloride market rose at a high level, and the import potassium price of the port also continued to rise. The cost support was strong, which supported the rise of potassium carbonate market.

Potash analysts from business news agency believe that the recent start-up of potash fertilizer plant is not high, and the market price is high and firm. It is expected that the price of potash carbonate will mainly rise in the short term, and the long-term market still needs to wait and see. (the above prices are provided by the main manufacturers of potassium nitrate all over the country and sorted out and analyzed by the potassium carbonate analysts of the business society. They are for reference only. For more price details, please contact the relevant manufacturers for consultation).

In the second quarter, the polyester market may be in a state of “high in the front and low in the back”. In terms of variety selection and rhythm, ethylene glycol is more optimistic in the short term. We believe that ethylene glycol will benefit from the continuous de stocking.

(1) Shut down of foreign plants and import reduction of ethylene glycol

Ethylene glycol is still in the trend of destocking. We believe that with the slow recovery of import volume and the upward focus of domestic production, the inflection point between supply and demand of ethylene glycol will appear in the middle and late April at the earliest, and may really usher in obvious inventory accumulation. (1) The import of ethylene glycol is still an important part of domestic supply. In 2020, the total import volume of ethylene glycol is nearly 10.55 million tons, accounting for 54% of the total domestic supply. In terms of the quarterly distribution of import volume, the import volume showed an expanding state from the first quarter to the third quarter. It didn’t shrink significantly until the fourth quarter. From the change of import volume in the fourth quarter, the month on month decrease is close to 26%, and the import volume in the current quarter only accounts for 18% of the total import volume of the whole year, which is nearly 6% lower than that in the same period of previous years.

It is estimated that the total import volume of ethylene glycol in the first quarter will be around 2 million tons; from the comparison of import volume, it will be nearly 600000 tons lower than the average level of the same period from 2018 to 2020; from the marginal change point of view, the growth rate of this import volume will be about 5 percentage points lower than the level of the same period from 2018 to 2020.

(2) Import reduction drives domestic inventory to accelerate de stocking

From the perspective of ethylene glycol inventory changes, the fourth quarter of last year reflected the accelerated decline of total inventory, including the dominant port inventory and invisible factory inventory. In the first quarter of this year, the dominant port inventory of ethylene glycol was further down, but the change of total inventory was relatively mild, which implied the rising state of invisible factory end inventory in this period. By stages, under the influence of import reduction in the fourth quarter, the total ethylene glycol inventory decreased by more than 700000 tons, of which the dominant port inventory decreased by more than 50 tons, and its proportion in the total ethylene glycol inventory decreased from 50% at the end of the third quarter to around 41%, and this proportion basically returned to the level at the end of 2019. In the first quarter of this year, the dominant port inventory of ethylene glycol was further declining. As of March 22, the main port inventory of East China had dropped to 635000 tons, more than 200000 tons lower than that at the end of last year. However, the total amount of ethylene glycol inventory in the same period had dropped by nearly 90000 tons to around 2 million tons, basically around 2.05 million tons, showing a relatively stable state. In fact, it also reflected the decline of dominant inventory of ethylene glycol The invisible inventory in the process of decreasing is in the state of increasing.

(3) The recovery of foreign plants coincides with the domestic production capacity

Judging from the changes of foreign devices, the capacity of the interruption reached a high point in February and fell back in March, but it was still higher than the level in January. From the perspective of plant distribution, the capacity interruption in North America accounted for about half of the total capacity in February and March, and the United States was the largest incremental source. From the actual situation, the cold wave was the direct cause of the previous ethylene glycol capacity interruption in the United States, but it has been restarted since March, and has been basically restored in the near future. As for the impact of domestic imports, we believe that the month on month increase of import volume in April is still the approximate time, but the substantial increase of North America’s supply may not occur until the end of April or even may.

The domestic ethylene glycol production level has been rising. At the same time, benefiting from the expected input of planned production capacity, the expectation of upward production is also further strengthened.

First of all, the rebound of ethylene glycol price and the expansion of production profit strongly promoted the enthusiasm of ethylene glycol production. In fact, with the rebound of ethylene glycol price, the profit level of either oil based ethylene glycol production or coal based ethylene glycol production has risen sharply. According to the data accounting, during this period, the maximum profit of oil based ethylene glycol per ton expanded to around us $200, while the maximum profit of coal based ethylene glycol per ton increased to around RMB 1500 per ton, all reaching a new high since 2019.

The elasticity of ethylene glycol production to price and profit is relatively large. With the expansion of profit, domestic ethylene glycol production has increased significantly. From the sub item point of view, the increase rate of oil to ethylene glycol production during the period was significantly higher than that of coal to ethylene glycol. The average operating rates of coal to ethylene glycol and oil to ethylene glycol increased by 8.2% and 13.8% respectively in March compared with January.

With the increase of glycol operation rate, the output level will rise to around 1 million tons in March. The total output of glycol in the first quarter is expected to be around 2.7 million tons. The monthly output and the total output in the first quarter will increase by 12.8% and 13.1% respectively.

Secondly, the expected input of planned production capacity will further strengthen the upward expectation of domestic production.

In terms of the short-term planned production capacity, the recent production of Shaanxi Weihua tends to be stable after the test run in mid March, and the extended oil plant will restart in late March; satellite petrochemical and Zhejiang Petrochemical may achieve stable production in April; in addition, the test run of Jianyuan coal coke and Hubei sanning, which were postponed in the fourth quarter of last year, also exists in April to May. If the planned production capacity can be put into operation smoothly, the domestic ethylene glycol production capacity will increase again.

Domestic production will benefit from the investment of production capacity. Based on the schedule estimation of production capacity, it is estimated that the output increment brought by the new production capacity from April to June will be 130000 tons, 280000 tons and 300000 tons respectively; affected by the production capacity, the ethylene glycol output is expected to exceed 1.1 million tons in May, or further rise to around 1.2 million tons in June. Under the market expectation of increasing the production focus, the inflection point between supply and demand of ethylene glycol market will appear in the middle and late April at the earliest, and there will be a significant inventory accumulation in May.

(4) Conclusion and suggestion

The general view of terminal textile and clothing demand is “high growth under low base”. If the influence of base is excluded, the compound growth rate of domestic textile and clothing retail sales from January to February is basically around 0, but the compound growth rate of textile and clothing exports is still more than 10%. For the demand of terminal textile and clothing in the second quarter, we think the growth rate will have a significant downward trend. We expect that in the first half of this year, the year-on-year growth rate of the total retail sales of domestic textiles and clothing will drop to 27-30%; the export of textiles and clothing will show a high momentum, and the re inventory process of foreign markets may continue to support the export of domestic textiles and clothing.

Polyester production continued to rise due to the expansion of production base and the increase of operating rate, which also provided a higher consumption base for ethylene glycol. The export of polyester products has recovered, but at present, the growth rate of export is relatively moderate, which means that under the environment of increasing polyester production, the digestion pressure of domestic market continues to increase. Polyester’s recent performance shows that the operating rate is continuously on the rise, but the production and sales remain at a low level. In this case, polyester inventory is being replenished, and the replenishment speed of inventory is also relatively fast. We expect that the quantile of polyester inventory will return to around 90% by mid April. We think that the improvement of production and sales or the regulation of supply is very important due to the pressure of inventory Necessary.

Ethylene glycol is still in the process of storage. In the fourth quarter of last year, both the dominant port inventory and the invisible factory inventory decreased significantly; since this year, the dominant port inventory has continued to decline, but the invisible factory inventory has actually increased.

In terms of glycol supply, the increase of import is relatively slow, but the direction of improvement is relatively clear; domestic production has benefited from price rebound and production profit recovery, at the same time, the investment of new capacity will further increase the process of domestic production improvement. In general, we believe that with the slow recovery of import volume and the upward growth of domestic production center, the inflection point between supply and demand of ethylene glycol will appear in the middle and late April at the earliest, and the obvious inventory accumulation may come in May.

Trading strategy: ethylene glycol presents high volatility, which may be more suitable for options to do price risk management; trading rhythm, in the first half of the second quarter, we are more optimistic about ethylene glycol, mainly due to the trend of ethylene glycol depopulation. The expansion of ethylene glycol supply is expected to bring about the continuous contraction of production profits. It is suggested to pay attention to ethylene glycol and crude oil, naphtha, etc., or Hedging opportunities between ethylene glycol and steam coal.

According to the data monitored by the business community, the domestic PP market showed a gradual downward trend in March, and the spot prices of various brands were reduced. As of April 1, the mainstream offer price of T30S (wire drawing) of domestic manufacturers and traders was about 8983.33 yuan / ton, a decrease of 4.94% compared with the average price at the beginning of the month, and a rise of 37.15% compared with the same period last year.

Cause analysis

PP upstream propylene domestic market in March high callback. At the beginning of this month, it took advantage of the early international crude oil price rise, and was in the high shock operation for many years. Then, with the good cost side, the rise was blocked, and this month’s decline was concentrated between the 18th and the 26th. Now the price of propylene is stable, and some units are still under maintenance. In general, overseas production has recovered slightly, domestic inventory is low, current crude oil price is volatile, and downstream operation rate is acceptable, but the market is mostly cold, and propylene is still high in the near future. It is expected that the market will be stabilized due to the influence of crude oil.

March propylene market high down, PP cost side support general. At the beginning of this month, affected by the rapid resumption of work in China, the demand on the site expanded rapidly. According to reports, the overall average operating rate of domestic polypropylene plants was about 93% in the first quarter, which was at a historical high. Overseas market supply is still tight, there is a certain growth in export orders this month. However, in the latter half of the year, Dongming Petrochemical added 200000 tons / year of production capacity, plus 850000 tons / year of new production capacity in the first two months, the rapidly expanding supply is under pressure from domestic propylene prices. Downstream factories gradually conflict with high price orders, and they are not willing to accept the goods. Floor trading is not smooth, there is a price reduction operation at the end of the month.

In terms of fiber materials, according to the data monitored by the business community, as of April 1, the mainstream offer of domestic producers and traders Z30S (fiber) was similar to that of wire drawing materials, with a price of about 9216.67 yuan / ton, a decrease of 2.81% compared with the average price at the beginning of the month, and a decrease of 14.92% compared with the same period last year. In March, fiber PP production was stable, accounting for about 13% of the total. The high price of goods affects the enthusiasm of the downstream to take goods. In addition, there are more and more spunbonded non-woven fabric manufacturers entering the market. At present, the shipping resistance of traders is increasing, and the profit margin is generally expanded.

Melt blown materials, the market in early March to undertake raw materials rose and melt blown PP outside the double boost market and opened higher, after the demand did not improve and the whole month stagflation, spot price shock down. As of April 1, the average quotation of pph-y1500 sample enterprises monitored by the business community was about 11000 yuan / ton. Basically back to the level before the rise. At present, the domestic epidemic situation is generally stable. The new situation in some areas of Yunnan has not effectively stimulated the demand for medical protective equipment, and the domestic demand for epidemic prevention materials has been fixed at a stable level. The overseas epidemic situation is still unclear, and many countries have reported a number of new coronal variant strains, so it is inevitable that the compulsory mask policy will be implemented for a long time. However, in March, the market performance of meltblown materials in the outer market was also average, and even jumeilai and other high melt fiber products were down in the first ten days. On the whole, the profit of melt blown fabric manufacturing market is not ideal, the excess capacity has been eliminated, and the melt blown PP market has entered a stable period.

Future forecast

Business community PP analysts believe that: March domestic PP spot market trend fell mainly. The upstream propylene price recovered, but it is still high, and the support for PP cost side is acceptable. Recently, the market supply has expanded, the industry competition has intensified, and the high price spot trading is not good. In addition, the lack of positive feedback of demand under the high opening rate led to the unsatisfactory trend of PP this month. Now has entered the maintenance season, polymerization plant shipments are expected to shrink, it is expected that PP market trend or will be affected by the supply side and stop rising.