Asian Markets
August 4, 2022
Chinese Epoxy Update
Epoxy in August Cautiously Optimistic
ECHEMI 2022-08-01
In July, the liquid epoxy resin went down all the way. The highest average price in the month was 22,000 yuan/ton, and the lowest average price was 17,800 yuan/ton, a drop of 19.09%; from January to July, the highest average price during the period was 29,300 yuan/ton, and the lowest average price was 29,300 yuan/ton. The price was 17,800 yuan/ton, a drop of 39.25%.
As of the weekend (7.29), the market price of liquid epoxy resin continued to fluctuate within a week, with limited news changes. This was mainly due to limited price fluctuations at the cost side of resins, few offers from resin manufacturers to discuss one by one, and a small amount of downstream just needed replenishment. Most of the merchants focus on stable prices, and the trading atmosphere in the market is sluggish, and it is difficult to increase the volume of real orders.
Market outlook forecast: It is expected that the epoxy resin market price will remain weak and fluctuated in the short term, and pay close attention to the trend of upstream dual raw materials and changes in downstream wind power and electronics demand.
Wind power is the ballast stone of the epoxy market, and wind power is expensive. This year, the state’s requirement for wind power installed capacity is to exceed 55GW. However, in the first half of the year, the actual installation volume was only 14.5GW, which was more than half of the time, and the installation progress did not exceed half of the time. Therefore, after August, it will gradually enter the peak installation period, and the demand for resin for blades should increase.
The 40.5GW wind power blades to be installed in the second half of the year will theoretically consume 172,200 tons of liquid epoxy, which will be allocated to 5 months, and 34,400 tons per month. However, judging from the current situation, wind power companies have not yet accelerated their actions, and the curing agent/diluent supporting the blades has no signs of recovery. Therefore, the pulling effect of wind power in August may be limited, and it is hoped that the wind power will be installed in September and October set off a climax.
Electronic appliances are estimated to be out of play. Last year, due to the global epidemic, online classes and home office overdrafts consumed a huge amount of electronic products such as tablet computers, TVs, etc., which greatly stimulated the demand for epoxy resins for electronic products. Although consumer electronics are updated quickly, they also have a certain life cycle. The market capacity that was saturated last year cannot be replicated this year. Due to the decline of the market, the demand for electronic resins has also declined this year. We can only see if the traditional gold, nine silver and ten consumption seasons can bring some hope.
On July 28, a meeting of the Political Bureau of the Central Committee was held, which is second only to the Central Economic Work Conference. In the middle of the year, it connects the previous and the next, analyzes and studies the current economic situation, and deploys the economic work in the second half of the year.
At present, the internal and external environment is more complex and severe. The epidemic and economic recovery have reached a critical point. The economy and capital market have also reached a new crossroads.
Regarding the economic growth target, the meeting pointed out that “the economy must be stabilized”, “maintain the economic operation within a reasonable range, and strive to achieve the best results”, “the major economic provinces must bravely take the lead, and the qualified provinces must strive to achieve the expected economic and social development goals. “.
This is a relatively new statement. The current international and domestic environment is complex, and the global economy is facing high uncertainty. The International Monetary Fund has just lowered its growth forecast for major global economies again.
In the second quarter of the country, major cities were affected by the epidemic. In the first half of the year, GDP achieved 2.5%. It will be very difficult to achieve the annual target of 5.5% at the beginning of the year.
The draft did not mention the specific numerical target of 5.5, which means that the annual growth target of around 5.5% is not a rigid requirement, but the meeting called for ensuring that the economy operates within a reasonable range.
With flood irrigation, the requirement of 5.5 can be fulfilled under a substantial stimulus, but on July 19, the Prime Minister just said that macroeconomic policies should be drip irrigation accurately, and that super-large-scale stimulus measures, excess currency issuance, and future advances will not be introduced in order to achieve excessive growth goals.
It is also a good thing not to mention the rigid requirements of numbers, which means that the upper levels are more objective and realistic, no longer simply pursuing numbers, and appropriately lowering expectations, which is conducive to the adjustment of my country’s economic structure and the healthy and stable development of the medium and long-term economy.
After reading the draft, it is not advisable to be overly optimistic about the economy, stock market and property market in the second half of the year. Under the condition of ensuring price stability in the second half of the year and the completion of the employment target, in the end, the economic growth rate will be slower, as long as it is acceptable within a reasonable range.
Therefore, under the premise that the national economic growth rate is slowing down, our hopes for epoxy resin in August should not be too optimistic.
July 28, 2022
Chinese Propylene Oxide Overview
Propylene oxide (PO) is the third largest propylene derivative after polypropylene and acrylonitrile. It can be made into polyurethane foam, it can also be made into fourth-generation detergent non-ionic surfactant, oil field demulsifier, pesticide emulsifier, etc. Derivatives of propylene oxide are widely used in furniture, home appliances, automobiles, construction, coatings and other industries. The production process of propylene oxide is mainly divided into direct oxidation method (HPPO), co-oxidation method (PO/SM or PO/TBA-MTBE) and chlorohydrin method (CHPO). The chlorohydrin process technology is relatively mature, the production process is relatively safe, and the investment required is small. With the relevant guidance documents promulgated by the government in 2011 and the state’s goal of “carbon peaking” and “carbon neutrality”, various administrative regions have implemented “dual control” measures. Under the overall environmental protection policy, the propylene oxide chlorohydrin method will generate more “three wastes”, and the cost of environmental protection treatment will be higher in the later stage. It is expected that with the continuous development of the industry, the co-oxidation method and the direct oxidation method will continue to improve. 
Since March 2020, the prices of propane and naphtha (hydrogenation) in my country have shown a continuous growth trend, mainly due to the rise in crude oil prices and the accumulation of demand for enterprises to resume work and production after the epidemic. On the whole, since 2020, upstream raw materials The increase in part led to the increase in the price of propylene oxide. The main products downstream of propylene oxide are polyether polyol, propylene glycol methyl ether, dimethyl carbonate, propylene glycol ether, etc. Polyether polyol is the largest downstream of propylene oxide, accounting for about 77.2% of the demand for propylene oxide. It is mainly used in the production of polyurethane foam. Its terminal downstream mainly includes white goods, building materials (mainly coatings), furniture and automobiles. In addition, the downstream product DMC (dimethyl carbonate), as the main lithium battery electrolyte solvent (transesterification method), benefits from the continuous growth of downstream new energy vehicle demand, and is expected to become a key demand growth point for propylene oxide. In 2021, as the domestic production capacity continues to be put into operation, the production capacity of propylene oxide in China continues to grow. In addition, the industry maintains a high degree of prosperity in the first half of the year, and the overall output rises significantly. Throughout the year, the output still increased by more than 30%. According to data, my country’s propylene oxide output in 2021 will be 3.46 million tons, a new high in recent years. 2023 is expected to be the year with the most new capacity additions, reaching 2.78 million tons. In the future, with the release of new production capacity, the supply of propylene oxide in my country will be able to meet the continuously growing demand, the import dependence is expected to decrease, and the supply and demand of propylene oxide market will tend to be relaxed. Future global market opportunities for propylene oxide in China In 2020, the Ministry of Commerce opened restrictions on the export of ECH for direct oxidation and co-oxidation processes; Weak domestic demand coupled with the expansion of production capacity, by the end of 2022, a total of nearly 2.5 million tons of new production capacity will be started. The import volume of propane will be reduced to less than 100,000 tons, and there will be an obvious turning point in the import and export next year)
If you have interesting about this material, please feel free to contact us.(chemical@echemi.com)
July 28, 2022
Chinese Propylene Oxide Overview
Propylene oxide (PO) is the third largest propylene derivative after polypropylene and acrylonitrile. It can be made into polyurethane foam, it can also be made into fourth-generation detergent non-ionic surfactant, oil field demulsifier, pesticide emulsifier, etc. Derivatives of propylene oxide are widely used in furniture, home appliances, automobiles, construction, coatings and other industries. The production process of propylene oxide is mainly divided into direct oxidation method (HPPO), co-oxidation method (PO/SM or PO/TBA-MTBE) and chlorohydrin method (CHPO). The chlorohydrin process technology is relatively mature, the production process is relatively safe, and the investment required is small. With the relevant guidance documents promulgated by the government in 2011 and the state’s goal of “carbon peaking” and “carbon neutrality”, various administrative regions have implemented “dual control” measures. Under the overall environmental protection policy, the propylene oxide chlorohydrin method will generate more “three wastes”, and the cost of environmental protection treatment will be higher in the later stage. It is expected that with the continuous development of the industry, the co-oxidation method and the direct oxidation method will continue to improve. Since March 2020, the prices of propane and naphtha (hydrogenation) in my country have shown a continuous growth trend, mainly due to the rise in crude oil prices and the accumulation of demand for enterprises to resume work and production after the epidemic. On the whole, since 2020, upstream raw materials The increase in part led to the increase in the price of propylene oxide. The main products downstream of propylene oxide are polyether polyol, propylene glycol methyl ether, dimethyl carbonate, propylene glycol ether, etc. Polyether polyol is the largest downstream of propylene oxide, accounting for about 77.2% of the demand for propylene oxide. It is mainly used in the production of polyurethane foam. Its terminal downstream mainly includes white goods, building materials (mainly coatings), furniture and automobiles. In addition, the downstream product DMC (dimethyl carbonate), as the main lithium battery electrolyte solvent (transesterification method), benefits from the continuous growth of downstream new energy vehicle demand, and is expected to become a key demand growth point for propylene oxide. In 2021, as the domestic production capacity continues to be put into operation, the production capacity of propylene oxide in China continues to grow. In addition, the industry maintains a high degree of prosperity in the first half of the year, and the overall output rises significantly. Throughout the year, the output still increased by more than 30%. According to data, my country’s propylene oxide output in 2021 will be 3.46 million tons, a new high in recent years. 2023 is expected to be the year with the most new capacity additions, reaching 2.78 million tons. In the future, with the release of new production capacity, the supply of propylene oxide in my country will be able to meet the continuously growing demand, the import dependence is expected to decrease, and the supply and demand of propylene oxide market will tend to be relaxed. Future global market opportunities for propylene oxide in China In 2020, the Ministry of Commerce opened restrictions on the export of ECH for direct oxidation and co-oxidation processes; Weak domestic demand coupled with the expansion of production capacity, by the end of 2022, a total of nearly 2.5 million tons of new production capacity will be started. The import volume of propane will be reduced to less than 100,000 tons, and there will be an obvious turning point in the import and export next year)
If you have interesting about this material, please feel free to contact us.(chemical@echemi.com)
May 16, 2022
Chinese MDI Update
The Aggregated MDI Market Fell First and Then Rose in April
ECHEMI 2022-05-06
At the beginning of the month, the domestic market price of aggregated MDI was 19,316 yuan/ton, and the price at the end of the month was 18,800 yuan/ton, a decrease of 2.67% during the month and a year-on-year decrease of 0.40%.
In April 2022, there are 41 commodities in the chemical sector that have increased month-on-month in the commodity price change list, of which 9 commodities have increased by more than 5%, accounting for 8.2% of the monitored commodities in this sector; the top 3 commodities are Formic acid (36.15%), caustic soda (13.35%), flake alkali (9.32%). A total of 66 commodities decreased month-on-month, and 29 commodities decreased by more than 5%, accounting for 26.4% of the monitored commodities in this sector; the top 3 products with a decrease were propylene glycol (-20.05%) and acetic acid (-18.39%). , Glycine (-16.77%). The average change this month was -1.87%.
At the beginning of the month, the domestic aggregated MDI market rose in a narrow range. One of the main reasons is that the logistics and transportation are severely restricted, the traffic at the expressway is congested, and the logistics and transportation costs are soaring. On the other hand, the spot supply in some areas is tight, especially in East China, and the quotations of mainstream traders are gradually rising.
In the first ten days of the month, the domestic aggregated MDI market declined in a narrow range. Traders offer scarce, more bearish outlook. The downstream sees the downturn in the market and increases the inquiring atmosphere, but transactions are rare.
In the middle of the month, the domestic aggregated MDI market continued to decline, mainly due to the low start of terminal enterprises and sluggish demand. Coupled with the high transportation costs, it is difficult to find a car, the regional control is strict, and the transportation is not smooth. Mainstream traders ship with them and talk about it one by one.
At the end of the month, the domestic aggregated MDI market stopped falling and rose, showing signs of recovery. Compared with East China, the logistics and transportation are relatively smooth, and some downstream customers who just need it are active in inquiries, and the demand has increased slightly. Traders are more reluctant to sell and negotiate. As the May Day holiday is approaching, some downstream companies have the intention to stock up, which has contributed to the recovery of the aggregated MDI price.
In terms of raw materials, pure benzene: styrene, caprolactam and other long-term losses, the price of pure benzene continues to rise and lack of motivation. However, new units such as Tianjin Dagu and Maoming Petrochemical styrene entered the market in May, and under the background of the gradual fading of the impact of the health incident and the recovery of the overall downstream consumption, the demand in May is expected to be stronger than that in April.
In terms of aniline, the aniline market fell sharply in April. The main reasons for the downturn of the aniline market are the obvious increase in the supply side, and the continued weakness of the demand side. The cost-side support remains strong, and it is difficult for aniline to fall below the “10,000 yuan throne”.
In terms of enterprises, Yantai Wanhua’s 1.1 million tons/year plant is operating normally; Ningbo Wanhua’s 1.2 million tons/year plant is operating normally; Shanghai Covestro’s 600,000 tons/year plant is operating normally; Shanghai Huntsman’s 380,000 tons/year plant is operating normally Normal operation; Shanghai BASF’s 220,000-ton/year plant is operating normally; Chongqing BASF’s 400,000-ton/year unit is operating normally; Tosoh Ruian’s 80,000-ton/year unit is operating normally.
Looking at the market outlook, it is still difficult for the market to fluctuate greatly after the May Day, and traders may lower their offers due to the large supply of goods at the beginning of the month. Analysts of the aggregated MDI of the business community predict that the domestic aggregated MDI market may enter the sorting stage.
May 16, 2022
Chinese MDI Update
The Aggregated MDI Market Fell First and Then Rose in April
ECHEMI 2022-05-06
At the beginning of the month, the domestic market price of aggregated MDI was 19,316 yuan/ton, and the price at the end of the month was 18,800 yuan/ton, a decrease of 2.67% during the month and a year-on-year decrease of 0.40%.
In April 2022, there are 41 commodities in the chemical sector that have increased month-on-month in the commodity price change list, of which 9 commodities have increased by more than 5%, accounting for 8.2% of the monitored commodities in this sector; the top 3 commodities are Formic acid (36.15%), caustic soda (13.35%), flake alkali (9.32%). A total of 66 commodities decreased month-on-month, and 29 commodities decreased by more than 5%, accounting for 26.4% of the monitored commodities in this sector; the top 3 products with a decrease were propylene glycol (-20.05%) and acetic acid (-18.39%). , Glycine (-16.77%). The average change this month was -1.87%.
At the beginning of the month, the domestic aggregated MDI market rose in a narrow range. One of the main reasons is that the logistics and transportation are severely restricted, the traffic at the expressway is congested, and the logistics and transportation costs are soaring. On the other hand, the spot supply in some areas is tight, especially in East China, and the quotations of mainstream traders are gradually rising.
In the first ten days of the month, the domestic aggregated MDI market declined in a narrow range. Traders offer scarce, more bearish outlook. The downstream sees the downturn in the market and increases the inquiring atmosphere, but transactions are rare.
In the middle of the month, the domestic aggregated MDI market continued to decline, mainly due to the low start of terminal enterprises and sluggish demand. Coupled with the high transportation costs, it is difficult to find a car, the regional control is strict, and the transportation is not smooth. Mainstream traders ship with them and talk about it one by one.
At the end of the month, the domestic aggregated MDI market stopped falling and rose, showing signs of recovery. Compared with East China, the logistics and transportation are relatively smooth, and some downstream customers who just need it are active in inquiries, and the demand has increased slightly. Traders are more reluctant to sell and negotiate. As the May Day holiday is approaching, some downstream companies have the intention to stock up, which has contributed to the recovery of the aggregated MDI price.
In terms of raw materials, pure benzene: styrene, caprolactam and other long-term losses, the price of pure benzene continues to rise and lack of motivation. However, new units such as Tianjin Dagu and Maoming Petrochemical styrene entered the market in May, and under the background of the gradual fading of the impact of the health incident and the recovery of the overall downstream consumption, the demand in May is expected to be stronger than that in April.
In terms of aniline, the aniline market fell sharply in April. The main reasons for the downturn of the aniline market are the obvious increase in the supply side, and the continued weakness of the demand side. The cost-side support remains strong, and it is difficult for aniline to fall below the “10,000 yuan throne”.
In terms of enterprises, Yantai Wanhua’s 1.1 million tons/year plant is operating normally; Ningbo Wanhua’s 1.2 million tons/year plant is operating normally; Shanghai Covestro’s 600,000 tons/year plant is operating normally; Shanghai Huntsman’s 380,000 tons/year plant is operating normally Normal operation; Shanghai BASF’s 220,000-ton/year plant is operating normally; Chongqing BASF’s 400,000-ton/year unit is operating normally; Tosoh Ruian’s 80,000-ton/year unit is operating normally.
Looking at the market outlook, it is still difficult for the market to fluctuate greatly after the May Day, and traders may lower their offers due to the large supply of goods at the beginning of the month. Analysts of the aggregated MDI of the business community predict that the domestic aggregated MDI market may enter the sorting stage.
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