Asian Markets
April 1, 2021
Hanwha TDI Investments
Chairman Kim Seung-yeon returns to Hanwha Group to drive new businesses
As Chairman of Hanwha Group Kim Seung-yeon returns to management after seven years, Hanwha’s core affiliates are taking a drive in new businesses.
ANI | Seoul | Updated: 01-04-2021 08:56 IST | Created: 01-04-2021 08:56 IST
Seoul [Sout Korea], April 1 (ANI/Global Economic): As Chairman of Hanwha Group Kim Seung-yeon returns to management after seven years, Hanwha’s core affiliates are taking a drive in new businesses. Following trillions of investments in space and aviation, it will also promote its own production of Dinitrotoluene (DNT).
It was announced on Wednesday that Hanwha Solutions [009830] and Hanwha Co., Ltd. are planning to jointly invest a total of 350 billion won to build a nitric acid and nitric acid derivatives (DNT) production facility in Yeosu Industrial Complex. DNT, which is produced from nitric acid and toluene, is a key raw material for toluene diisocyanate (TDI), that is used to produce artificial leather etc.
Hanwha Solutions plans to invest 160 billion won and Hanwha Co., Ltd. 190 billion won to build nitric acid and nitrate derivatives (DNT) facilities. Hanwha Solutions has been purchasing TDI from Hu-Chems [069260] until now, and when this plant is completed, 100% of TDI can be produced in-house.
The two companies plan to build a TDI production facility with an annual capacity of 180,000 tons using the area of 66,000m^2, half of the 132,000m^2polysilicon site in the Yeosu Industrial Complex of Hanwha Solutions. It aims for commercial production in January 2024. An official at Hanwha Solutions explained, “With this in-house DNT production, we will build a vertical integration line for the production of caustic soda, chlorine, synthetic gas, DNT, and TDI.”
Hanwha Solutions predicts that if TDI is produced in-house, the operating margin will increase by about 10 % due to cost improvement. Through this project, Hanwha Corporation is expanding its nitric acid business by producing 400,000 tons of nitric acid.
Hanwha Corporation plans to advance into the inorganic chemistry and derivatives business by enhancing its nitric acid business competitiveness. Prior to this investment, Hanwha Group decided to make a paid-in capital increase worth 1.2 trillion won to Hanwha Systems [272210], a defense, space, and aviation company.
Hanwha System’s largest shareholders, Hanwha Aerospace [012450] and H Solutions, are participating in a total capital increase of 730 billion won. H Solution is a company that is 100% owned by three sons of Chairman Kim Seung-yeon, Kim Dong-gwan, Kim Dongwon, and Kim Dongseon.
Hanwha Systems is planning to invest 500 billion won in LEO (Low Earth Orbit) satellite communications, 450 billion won in air mobility business, and 250 billion won in blockchain-based digital platform business throughout 3 years starting this year. It is planning to expand the air mobility (air taxi) business in earnest. The business community believes that the power of Chairman Kim Seung-yeon, who returned to management after seven years, is attributable to Hanwha Group’s recent active business expansion. (ANI/Global Economic)
April 1, 2021
Hanwha TDI Investments
Chairman Kim Seung-yeon returns to Hanwha Group to drive new businesses
As Chairman of Hanwha Group Kim Seung-yeon returns to management after seven years, Hanwha’s core affiliates are taking a drive in new businesses.
ANI | Seoul | Updated: 01-04-2021 08:56 IST | Created: 01-04-2021 08:56 IST
Seoul [Sout Korea], April 1 (ANI/Global Economic): As Chairman of Hanwha Group Kim Seung-yeon returns to management after seven years, Hanwha’s core affiliates are taking a drive in new businesses. Following trillions of investments in space and aviation, it will also promote its own production of Dinitrotoluene (DNT).
It was announced on Wednesday that Hanwha Solutions [009830] and Hanwha Co., Ltd. are planning to jointly invest a total of 350 billion won to build a nitric acid and nitric acid derivatives (DNT) production facility in Yeosu Industrial Complex. DNT, which is produced from nitric acid and toluene, is a key raw material for toluene diisocyanate (TDI), that is used to produce artificial leather etc.
Hanwha Solutions plans to invest 160 billion won and Hanwha Co., Ltd. 190 billion won to build nitric acid and nitrate derivatives (DNT) facilities. Hanwha Solutions has been purchasing TDI from Hu-Chems [069260] until now, and when this plant is completed, 100% of TDI can be produced in-house.
The two companies plan to build a TDI production facility with an annual capacity of 180,000 tons using the area of 66,000m^2, half of the 132,000m^2polysilicon site in the Yeosu Industrial Complex of Hanwha Solutions. It aims for commercial production in January 2024. An official at Hanwha Solutions explained, “With this in-house DNT production, we will build a vertical integration line for the production of caustic soda, chlorine, synthetic gas, DNT, and TDI.”
Hanwha Solutions predicts that if TDI is produced in-house, the operating margin will increase by about 10 % due to cost improvement. Through this project, Hanwha Corporation is expanding its nitric acid business by producing 400,000 tons of nitric acid.
Hanwha Corporation plans to advance into the inorganic chemistry and derivatives business by enhancing its nitric acid business competitiveness. Prior to this investment, Hanwha Group decided to make a paid-in capital increase worth 1.2 trillion won to Hanwha Systems [272210], a defense, space, and aviation company.
Hanwha System’s largest shareholders, Hanwha Aerospace [012450] and H Solutions, are participating in a total capital increase of 730 billion won. H Solution is a company that is 100% owned by three sons of Chairman Kim Seung-yeon, Kim Dong-gwan, Kim Dongwon, and Kim Dongseon.
Hanwha Systems is planning to invest 500 billion won in LEO (Low Earth Orbit) satellite communications, 450 billion won in air mobility business, and 250 billion won in blockchain-based digital platform business throughout 3 years starting this year. It is planning to expand the air mobility (air taxi) business in earnest. The business community believes that the power of Chairman Kim Seung-yeon, who returned to management after seven years, is attributable to Hanwha Group’s recent active business expansion. (ANI/Global Economic)
March 21, 2021
China Demand Puzzle
China petrochemicals and the lack of logical basis for the 2021 boom theory
Business, Company Strategy, Economics, Europe, European economy, European petrochemicals, Fibre Intermediates, India, Indonesia, Oil & Gas, Olefins, Philippines, Polyolefins, Singapore, South Korea, Taiwan, Thailand, US By John Richardson on 21st March 2021 in Business, Company Strategy, Economics, Europe, European economy, European petrochemicals, Fibre Intermediates, India, Indonesia, Oil & Gas, Olefins, Philippines, Polyolefins, Singapore, South Korea, Taiwan, Thailand, US SHARE THIS STORY
By John Richardson
IF YOU DO a Google search, you will find a lot of articles on China’s economic recovery. Click on the links, spend some time reading them in detail, and you will discover a common narrative: China’s recovery remains on track this year. But you will not find the data that conclusively supports this notion.
But we do have ICIS petrochemicals data for 2020 which shows an historically good year in Chins that defied all the pessimistic predictions.
Let me start with the above chart which shows the extraordinary strong growth in demand across a range of products. In terms of percentages, 2020 growth was in some cases more than what occurred in 2019 versus 2018.
And in all the examples above, the additional volumes of demand in 2020 were big. Take polypropylene (PP) as the standout example. Our preliminary estimate is that last year’s demand was around 4m tonnes more than in 2019.
Please also study the chart below which compares the same preliminary estimates for 2020, which are for apparent demand (net imports plus local production), with our original forecasts for real demand growth. Real demand is apparent demand adjusted for inventory distortions.
Across the three grades of polyethylene (PE), 2020 apparent demand was 2.7m tonnes more than our original forecasts. PP was 1.6m tonnes more and paraxylene 2m tonnes higher.
When we have completed our final estimates for China’s 2020 demand later this year, it might be that our final numbers are not quite as bullish as these estimates for apparent demand.
But without doubt, our final numbers will be much higher than our original forecasts. China will have generated many millions of tonnes of consumption that had not been expected.
Why I continue to focus on these themes is that I am concerned our ICIS customers will end up being exposed to a sudden correction in pricing if we eventually discover that demand growth so far this year has been weaker than in Q4 2020. This is the crucial comparison because growth in the fourth quarter of last year was so extraordinarily strong.
I am not saying, and have never said, that China’s economy could fall off the proverbial shelf. The risk is instead that the same growth momentum will not be maintained.
I believe that China’s economy has lost some steam, mainly because China’s export growth must have slowed down in Q1 2021 – again compared with the fourth quarter of 2020, the only valid comparison.
Why do I believe export growth will have slowed down? Firstly, because some loss of momentum was always going to happen given Q4 last year was so strong. The second reason is there are so many negative influences on exports, their sheer number points in a clear direction.
February’s official and Caixin/Markit purchasing managers’ (PMIs) indices both indicated a fall in new export orders. Perhaps the March PMIs will tell us something different. But they will cover new export orders for April which is obviously in Q2.
It stands to reason that there must have been some negative effect on Chinese exports because of the global container-freight and semiconductor shortages.
The lack of data and analysis on both these critical supply-chain issues is, I believe, a major concern. We need to get better at monitoring supply chains in general – a theme I will cover in detail in later posts.
It could be that the double-dip recession in the EU has slowed Chinese export growth; and/or peak demand has already arrived for laptops, washing machines and all other goods that we have bought in greater volumes because we have been stuck in lockdowns. Another “and/or” could be that the easing of lockdowns has reduced demand for lockdown-related goods.
Our lack of ability to adequately assess the variables in this last paragraph was the theme of my 18 March post.
It is critical to understand that last year’s soaring petrochemicals demand in China was mainly an “in-out” story – rising petrochemicals imports that were re-exported as finished goods that served pandemic-related demand. The data clearly tell us this.
What is also important to recognise is that last year, Chinese local consumption was smaller than before the pandemic. The only question is how much smaller: were 2020 retail sales 3.9% down on 2019 – the official number – or 4.8% lower, the China Beige Book estimate?
Domestic demand growth will, I believe, be underwhelming during Q1 2021 because of disappointing Lunar New Year holiday spending. Government economic stimulus has also been reduced in 2021. This is in response to the rise in debts caused by the pandemic-relief programme.
The steep decline in Chinese stock markets during March might have also negatively affected domestic spending.
The health of local stock markets is critical to measure when trying to assess Chinese consumer spending because the vast majority of investors are retail investors. One study suggests that no less than 99.6% of 2019 investments in Chinese markets were by retail or individual players. This compared with 48% in the US.
Let me stress that when I say domestic demand growth will be underwhelming in Q1 2021, I am not suggesting anything like a collapse. I am instead suggesting that somewhat disappointing local growth will combine with weaker exports to reduce the all-important economic momentum versus the fourth quarter of 2020.
The consensus view is that Chinese growth must be stronger than this year than in 2020 because the worst of the global pandemic appears to be behind us. But for the reasons I have detailed above, I don’t believe this view has a logical foundation.
Muddling apparent with real demand
I also worry that mainstream thinking has muddled strong apparent demand, caused by the recent surge in prices, with real demand.
The run-up in global petrochemicals pricing since the major US outages in February will, in time-honoured tradition, have prompted buyers to purchase ahead of their immediate raw material needs to hedge against the potential for further price increases.
If you are a PE converter, for instance, you might buy an extra few hundred tonnes in March even if the extra tonnes are beyond the immediate requirements of your customers.
You put the tonnes into storage without any visibility on whether the demand from your customers will be sufficient in April to fully consume your extra stocks.
But worrying about customer orders is not your top priority when raw-material costs are rising rapidly, as has been the case over the last few weeks. Your priority is to hedge against further price rises.
This is obviously a big risk for buyers as petrochemicals prices very suddenly so often head in the opposite direction because of unforeseen events.
Take last week’s 7% fall in oil prices as a good example which surprised crude markets that had been very bullish since the start of the year. The decline was said to be the result of a rising US dollar, increased crude inventories and fresh setbacks in European vaccination programmes.
The fall in oil prices led to lower Asian benzene, ethylene and propylene prices for the week ending 19 March, according to ICIS price assessments. But polymer markets had not been affected.
“Only when the tide goes out…”
… do you discover who’s been swimming naked,” Warren Buffett famously said.
It might be oil prices which expose who is swimming naked swimmers if the retreat in crude continues. And/or it could be the easing of historically tight petrochemicals markets as US plants come online and some of the more recent US outages are resolved.
But I believe the tide must go out over the next few months. I am not going to comment on oil prices as nobody has a clue about their direction. What without doubt will happen, though, is that petrochemicals tight supply will ease, sometime probably in April.
We will then start to understand the real and underlying nature of petrochemicals demand in the world’s most important market.
Who will be swimming naked? It will be the petrochemicals producers, buyers and traders who don’t already have purchasing and sales plans in place to deal with modestly lower Chinese growth at a time when local capacity is also sharply increasing.
For advice on how to build these plans, contact me at john.richardson@icis.com.
March 21, 2021
China Demand Puzzle
China petrochemicals and the lack of logical basis for the 2021 boom theory
Business, Company Strategy, Economics, Europe, European economy, European petrochemicals, Fibre Intermediates, India, Indonesia, Oil & Gas, Olefins, Philippines, Polyolefins, Singapore, South Korea, Taiwan, Thailand, US By John Richardson on 21st March 2021 in Business, Company Strategy, Economics, Europe, European economy, European petrochemicals, Fibre Intermediates, India, Indonesia, Oil & Gas, Olefins, Philippines, Polyolefins, Singapore, South Korea, Taiwan, Thailand, US SHARE THIS STORY
By John Richardson
IF YOU DO a Google search, you will find a lot of articles on China’s economic recovery. Click on the links, spend some time reading them in detail, and you will discover a common narrative: China’s recovery remains on track this year. But you will not find the data that conclusively supports this notion.
But we do have ICIS petrochemicals data for 2020 which shows an historically good year in Chins that defied all the pessimistic predictions.
Let me start with the above chart which shows the extraordinary strong growth in demand across a range of products. In terms of percentages, 2020 growth was in some cases more than what occurred in 2019 versus 2018.
And in all the examples above, the additional volumes of demand in 2020 were big. Take polypropylene (PP) as the standout example. Our preliminary estimate is that last year’s demand was around 4m tonnes more than in 2019.
Please also study the chart below which compares the same preliminary estimates for 2020, which are for apparent demand (net imports plus local production), with our original forecasts for real demand growth. Real demand is apparent demand adjusted for inventory distortions.
Across the three grades of polyethylene (PE), 2020 apparent demand was 2.7m tonnes more than our original forecasts. PP was 1.6m tonnes more and paraxylene 2m tonnes higher.
When we have completed our final estimates for China’s 2020 demand later this year, it might be that our final numbers are not quite as bullish as these estimates for apparent demand.
But without doubt, our final numbers will be much higher than our original forecasts. China will have generated many millions of tonnes of consumption that had not been expected.
Why I continue to focus on these themes is that I am concerned our ICIS customers will end up being exposed to a sudden correction in pricing if we eventually discover that demand growth so far this year has been weaker than in Q4 2020. This is the crucial comparison because growth in the fourth quarter of last year was so extraordinarily strong.
I am not saying, and have never said, that China’s economy could fall off the proverbial shelf. The risk is instead that the same growth momentum will not be maintained.
I believe that China’s economy has lost some steam, mainly because China’s export growth must have slowed down in Q1 2021 – again compared with the fourth quarter of 2020, the only valid comparison.
Why do I believe export growth will have slowed down? Firstly, because some loss of momentum was always going to happen given Q4 last year was so strong. The second reason is there are so many negative influences on exports, their sheer number points in a clear direction.
February’s official and Caixin/Markit purchasing managers’ (PMIs) indices both indicated a fall in new export orders. Perhaps the March PMIs will tell us something different. But they will cover new export orders for April which is obviously in Q2.
It stands to reason that there must have been some negative effect on Chinese exports because of the global container-freight and semiconductor shortages.
The lack of data and analysis on both these critical supply-chain issues is, I believe, a major concern. We need to get better at monitoring supply chains in general – a theme I will cover in detail in later posts.
It could be that the double-dip recession in the EU has slowed Chinese export growth; and/or peak demand has already arrived for laptops, washing machines and all other goods that we have bought in greater volumes because we have been stuck in lockdowns. Another “and/or” could be that the easing of lockdowns has reduced demand for lockdown-related goods.
Our lack of ability to adequately assess the variables in this last paragraph was the theme of my 18 March post.
It is critical to understand that last year’s soaring petrochemicals demand in China was mainly an “in-out” story – rising petrochemicals imports that were re-exported as finished goods that served pandemic-related demand. The data clearly tell us this.
What is also important to recognise is that last year, Chinese local consumption was smaller than before the pandemic. The only question is how much smaller: were 2020 retail sales 3.9% down on 2019 – the official number – or 4.8% lower, the China Beige Book estimate?
Domestic demand growth will, I believe, be underwhelming during Q1 2021 because of disappointing Lunar New Year holiday spending. Government economic stimulus has also been reduced in 2021. This is in response to the rise in debts caused by the pandemic-relief programme.
The steep decline in Chinese stock markets during March might have also negatively affected domestic spending.
The health of local stock markets is critical to measure when trying to assess Chinese consumer spending because the vast majority of investors are retail investors. One study suggests that no less than 99.6% of 2019 investments in Chinese markets were by retail or individual players. This compared with 48% in the US.
Let me stress that when I say domestic demand growth will be underwhelming in Q1 2021, I am not suggesting anything like a collapse. I am instead suggesting that somewhat disappointing local growth will combine with weaker exports to reduce the all-important economic momentum versus the fourth quarter of 2020.
The consensus view is that Chinese growth must be stronger than this year than in 2020 because the worst of the global pandemic appears to be behind us. But for the reasons I have detailed above, I don’t believe this view has a logical foundation.
Muddling apparent with real demand
I also worry that mainstream thinking has muddled strong apparent demand, caused by the recent surge in prices, with real demand.
The run-up in global petrochemicals pricing since the major US outages in February will, in time-honoured tradition, have prompted buyers to purchase ahead of their immediate raw material needs to hedge against the potential for further price increases.
If you are a PE converter, for instance, you might buy an extra few hundred tonnes in March even if the extra tonnes are beyond the immediate requirements of your customers.
You put the tonnes into storage without any visibility on whether the demand from your customers will be sufficient in April to fully consume your extra stocks.
But worrying about customer orders is not your top priority when raw-material costs are rising rapidly, as has been the case over the last few weeks. Your priority is to hedge against further price rises.
This is obviously a big risk for buyers as petrochemicals prices very suddenly so often head in the opposite direction because of unforeseen events.
Take last week’s 7% fall in oil prices as a good example which surprised crude markets that had been very bullish since the start of the year. The decline was said to be the result of a rising US dollar, increased crude inventories and fresh setbacks in European vaccination programmes.
The fall in oil prices led to lower Asian benzene, ethylene and propylene prices for the week ending 19 March, according to ICIS price assessments. But polymer markets had not been affected.
“Only when the tide goes out…”
… do you discover who’s been swimming naked,” Warren Buffett famously said.
It might be oil prices which expose who is swimming naked swimmers if the retreat in crude continues. And/or it could be the easing of historically tight petrochemicals markets as US plants come online and some of the more recent US outages are resolved.
But I believe the tide must go out over the next few months. I am not going to comment on oil prices as nobody has a clue about their direction. What without doubt will happen, though, is that petrochemicals tight supply will ease, sometime probably in April.
We will then start to understand the real and underlying nature of petrochemicals demand in the world’s most important market.
Who will be swimming naked? It will be the petrochemicals producers, buyers and traders who don’t already have purchasing and sales plans in place to deal with modestly lower Chinese growth at a time when local capacity is also sharply increasing.
For advice on how to build these plans, contact me at john.richardson@icis.com.
March 18, 2021
Chemical Prices Soar in China
Soaring 11,000 yuan/ton! Chemical raw materials skyrocketed “breaking records”!
Echemi 2021-03-17
Recently, affected by factors such as limited supply and strong demand, the price of Bisphenol A (BPA) in Asia has soared to a historical high, and the current price has reached US$2,800 to US$3,000/ton. Since January this year, the price of bisphenol A has been rising. The current price has reached RMB 24,666/ton, which is an increase of RMB 11,441/ton, an increase of 86.51% compared to the price of RMB 13,225/ton on January 4. Market participants worry that under the current tight supply situation, the demand for bisphenol A will become tighter, which is likely to lead to high prices.
At the beginning of 2021, many industries such as chemicals, food, industrial products, etc. seem to have taken a stand, starting to increase prices across the board, and some even soared, setting a new high in the past 10 years, raising the average market price by a notch.
The prices of chemicals, food, industrial products and other industries hit new highs
PVC monthly increase of 26.5%, the highest since 2010
PVC (polyvinyl chloride) futures surged over 4.5%. The price of calcium carbide PVC in East China was 9,209 yuan/ton, and the price difference was 3915.25 yuan/ton. The current price is at the highest level since 2010, with a monthly increase of 22.9%; East China The price of ethylene-based PVC is 9,700 yuan/ton, and the price difference is 7353 yuan/ton. The current price is at the highest level since 2010, with a monthly increase of 26.5%. Previously, domestic PVC prices reached their highest point in the past ten years in December 2020.
Titanium dioxide hits a 3-year high
The average price of rutile titanium dioxide is 18,000 yuan/ton, and some companies’ quotations have reached 20,000 yuan/ton, which is the highest price in three years. In addition, under the current supply and demand conditions, there is still an upward trend.
BDO hits a 10-year high
The return of the Spring Festival in 2021 will be only five working days, and there will be 4 auctions, boosting the domestic BDO market from 18,500 yuan/ton to 29,500 yuan/ton, an average daily increase of 2,200 yuan/ton, and only an increase of 5,000 yuan/ton on the 23rd Tons, a new historical high point since 2010.
Acetic acid breaks through a 10-year high
The price of acetic acid rose to 6066.67 yuan/ton, an increase of 141.06% year-on-year. The price of acetic acid rose for six consecutive months, breaking a 10-year high.
DOTP hits a new high in 8-9 years
Since 2021, the DOTP market has shown an upward pattern as a whole, especially after the Spring Festival holiday, the price has hit a new high in 8-9 years. Taking the price in Zhejiang as a benchmark, the price of DOTP rose by as much as 3,700 yuan/ton in just 7 days after the holiday.
Asian PX prices hit 21-month high
The Asian PX price hit a 21-month high, reaching 895.83 US dollars/ton (CFR, China). Since the beginning of this month, the price has jumped by 172.66 US dollars/ton, an increase of 23.9%. The last price high occurred on May 27, 2019, at a price of US$896.25/ton.
Shanghai aluminum futures prices have reached a 9-year high
Since January, Shanghai Aluminum has rebounded from a low level again. By March 15th, Shanghai Aluminum’s main contract closed at 17,650 yuan/ton. The current price has reached a 9-year high.
DOP price breaks 9-year high
In 2021, the DOP price broke a 9-year high, with a quoted price of 14,167 yuan/ton, an increase of 20.91% month-on-month. The current price has hit a new high since 2012 and the fastest rate of increase in the past 10 years.
International and domestic prices of diammonium phosphate hit a new high in nearly 10 years
The FOB prices of DAP in the U.S. Gulf, Morocco and China are US$530/547.5/517.5/ton respectively, up by more than 35% year-to-date, up by more than 75% year-on-year; the current ex-factory price of DAP at Yuntianhua is 3,000 yuan/ton, up year-on-year 46%, up 25% year-to-date. The international and domestic prices of diammonium phosphate hit a new high in the past 10 years.
Adipic acid breaks through the nearly 3-year high
Entering March, in the first two working days, adipic acid has an unprecedented increase of 12.66%, and the national market has generally risen by more than 1,000 yuan. The current price is in the range of 10500-11000 yuan/ton, breaking through the high point in the past three years.
Butyl acrylate surpasses 9-year high
The price of butyl acrylate was 19100 yuan/ton, an increase of 6466.67 yuan/ton, or 51.19%, compared with the price before the Spring Festival. In 2021, the domestic market price of butyl acrylate has surpassed the high price in the 9 years from 2012 to 2020, and has caught up with the high price in 2011 10 years ago.
Maleic anhydride hit a 4-year high
Maleic anhydride was quoted at RMB 12,750/ton, a 4-year high.
Spandex breaks through the 2011 price, the highest price in the past 10 years
Spandex broke the price in 2011, the highest price in the past 10 years. Since August last year, the domestic price of spandex has continued to soar. The average market price of 40D specification is 57,000 yuan/ton, which is an increase compared with the lowest price in August 2020. 84.47%.
EPDM rubber hits a new high in more than 5 years
The EPDM rubber reached 22,000 yuan/ton, a record high in more than five years; the average price increased by 7.18% month-on-month and 42.78% year-on-year.
Titanium concentrate hits a 3-year high
The price of Sichuan Panzhihua Iron and Steel’s titanium concentrate rose to 2,300 yuan/ton, and the highest price in the past 10 years was 2,400 yuan/ton. The price of titanium concentrate rose by more than 40% year-on-year, a three-year high.
DBP breaks through 3-year high
DBP rose to 12,500 yuan/ton, breaking through a 3-year high, with an average price of 9,890.38 yuan/ton, an increase of 38.68% year-on-year.
Propylene oxide hits a new high since 2008
The price of propylene oxide in Shandong and other major producing areas and major consumer areas in the East China market was 19,100-19,400 yuan/ton. The highest price has surpassed last year’s high and hit a new high since 2008. At present, the inventory of production enterprises is low, and the market spot is tight to further boost the upward trend.
The average price of welded pipe and galvanized pipe is at the highest level in the past 10 years
The national average price of 4-inch*3.75mm welded pipe is 5230 yuan/ton, up 522 yuan/ton month-on-month, and 1,214 yuan/ton year-on-year; the national average price of 4-inch*3.75mm galvanized pipe is 5823 yuan/ton, month-on-month In February, the price rose by 597 yuan/ton, which was a year-on-year increase of 1116 yuan/ton. At present, the average price of welded pipes and galvanized pipes in the country is at the highest level in the past 10 years. However, in March of previous years, the prices of welded pipes and galvanized pipes in the country rarely experienced sharp increases.
Billet prices hit 10-year highs 4 times
Since March, the domestic steel barometer Tangshan billet prices have hit a 10-year high four times. March 3 was 4410 yuan/ton, March 7 was 4410 yuan/ton, March 12 was 4430 yuan/ton, and March 15 was 4440 yuan/ton. Although terminal profits have been compressed and purchasing capabilities have declined, manufacturers are still dominated by optimism, and prices still have a certain degree of support. From the perspective of historical prices, since 2008, the highest point of billet prices was RMB 5,600/ton in 2008, and the second highest point was RMB 4,530/ton in 2011.
Iron ore prices hit a new high since 2011
Iron ore prices soared on the first trading day after the Spring Festival, reaching the highest level since September 2011. The benchmark 62% iron powder (CFR Qingdao) imported from northern China changed hands at a price of US$175.05 per ton, a 9% increase from the beginning of the year. Iron ore 65% Fe Brazil daily index rose 4.2% to $198 per ton, a record high.
Copper prices rose by 10%, hitting a 9-year high
Since February this year, copper prices have risen rapidly. The main force of Shanghai copper has risen to 70,000 yuan/ton, a 9-year high. It has recently corrected slightly but still remains at a high level of more than 60,000 yuan/ton, with a cumulative increase of more than 10%.
Sales of electrical appliances increased, and panel prices hit a 1-year high
Domestic mobile phone shipments in January increased by 92.8% year-on-year and 50.85% month-on-month to 40.12 million units. In January, notebook panel shipments increased by 51% year-on-year, and LCD TV panel shipments increased slightly by 1%. In February, the prices of small-size panels (tablets, mobile phones, and notebooks) all hit new highs since 2020, up 3.4%, 0%, and 5.7% from January, reaching 30.7, 13.5, and 35.1 US dollars per piece, respectively.
Cherries hit a new high in recent years, and the overall price is about 10% more expensive than in previous years
At the moment, greenhouse cherries in Dalian, Liaoning, have been matured one after another, and their prices have hit a new high in recent years. The first fruit began to mature in late February and sold for 120 yuan per catty. The market is the best year in recent years. The price was already lowered at this time last year, and there is no price lower this year. The overall price is about 10% higher than in previous years.
The main soybean futures contract rose by 50% year-on-year, setting a new record high
Affected by the increase in the purchase price of domestic soybeans, the main contract of Bean One Futures continued to rise, reaching a maximum of 6,375 yuan per ton during the session, which continued to set a record high. Bean One Futures mainly refers to domestic non-GMO soybeans, which are generally used in the processing and production of various soybean products. This data has increased by 50% compared with the same period last year.
Supply and demand imbalances and financial factors have jointly pushed up prices in multiple industries
Recently, it seems that many industrial chains have joined the queue of price increases. Whether it is multiple categories of chemical products, bulk industrial products, and industries closely related to people’s food, clothing, housing, and transportation, they have shown a hot trend. This is related to the imbalance of supply and demand and financial factors. And many other factors. The global new crown pneumonia epidemic has slowed down, and terminal industry demand has been significantly boosted, but the supply side cannot meet the downstream demand for various reasons, which has caused an imbalance of supply and demand. The US$1.9 trillion fiscal stimulus policy and its inflation expectations have stimulated financial enthusiasm for investment in the commodity market. Crude oil futures prices have fluctuated sharply, boosting market risk sentiment, and multiple industrial chains have shown upward trends. Based on the current situation, industry insiders said that from a horizontal perspective, the prosperity of many industries such as chemical industry may continue to rise, and it is difficult to see a decline in the short term.
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