March 3, 2021

BDO & PTMEG Asian Update

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Price change of spandex market around Spring Festival holiday Variety Unit 2021-2-6 2021-3-1 Change Change BDO yuan/mt 15,950 31,000 15,050 94.36% MMDI yuan/mt 21,600 22,500 900 4.17% PTMEG yuan/mt 23,325 30,300 6,975 29.90% Spandex 20D yuan/mt 56,000 74,000 18,000 32.14% Spandex 30D yuan/mt 54,000 70,000 16,000 29.63% Spandex 40D yuan/mt 46,000 61,000 15,000 32.61% Spandex market was in uptrend after the Spring Festival holiday, following gains on upstream market. The increment of BDO market outpaced other products amid short supply and strong downstream demand. With surging feedstock prices, tight supply and improving downstream demand, spandex prices firmly chased up. Upward tendency on spandex value chain will be hard to alter amid sound fundamental in short run based on the following logic. BDO and PTMEG market: Supply of spot BDO remained short. Sellers mainly guaranteed term volume, with little supply for spot transactions. However, demand from downstream sectors such as PTMEG, GBL, PBT and spandex market was buoyant. One thing should be noted: Affected by continuously jumping price, some players on PU market have turned to use other more cost-effective materials instead of BDO. Buyers were cautious in purchasing under high price and mainly purchased to cover the most pressing demand. However, prices of BDO are expected to sustain firm as supply is tight and sellers are reluctant to sell, expecting price to surge. Supply of PTMEG was still in shortage and downstream players hoped upstream feedstock supply to be ample to guarantee production. Offers for PTMEG 1800 were mainly at 43,000-45,000yuan/mt in Mar, negotiable in actual transactions, up by 18,000-22,000yuan/mt compared with Feb. Demand for PTMEG was hot and prices of upstream and downstream products both climbed. Price of PTMEG is anticipated to hike further. Spandex market: Production cost of spandex hiked with surging BDO price and bigger increment of PTMEG in Mar. In addition, operating rate of downstream plants gradually ascended after Spring Festival holiday. Supported by sound demand and booming upstream market, prices of spandex extended higher. Current prices of spandex were mixed. The operating rate of spandex was still at 95%. Most spandex companies ran at full capacity now. Stocks of spandex climbed to 8 days, sustaining low. Spandex companies strongly intend to raise price boosted by growing rigid demand and mounting cost. In short run, prices of spandex are anticipated to move higher amid short supply but risk will enlarge too after price surged. Spandex inventory of some downstream players is around 15-30 days. Later procurement of downstream market should be noted. All in all, spandex value chain is still anticipated to extend higher in short run. Downstream order and procurement change should be concerned after price surged.

https://www.ccfgroup.com/newscenter/newsview.php?Class_ID=D00000&Info_ID=2103026520004

March 3, 2021

BDO & PTMEG Asian Update

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Price change of spandex market around Spring Festival holiday Variety Unit 2021-2-6 2021-3-1 Change Change BDO yuan/mt 15,950 31,000 15,050 94.36% MMDI yuan/mt 21,600 22,500 900 4.17% PTMEG yuan/mt 23,325 30,300 6,975 29.90% Spandex 20D yuan/mt 56,000 74,000 18,000 32.14% Spandex 30D yuan/mt 54,000 70,000 16,000 29.63% Spandex 40D yuan/mt 46,000 61,000 15,000 32.61% Spandex market was in uptrend after the Spring Festival holiday, following gains on upstream market. The increment of BDO market outpaced other products amid short supply and strong downstream demand. With surging feedstock prices, tight supply and improving downstream demand, spandex prices firmly chased up. Upward tendency on spandex value chain will be hard to alter amid sound fundamental in short run based on the following logic. BDO and PTMEG market: Supply of spot BDO remained short. Sellers mainly guaranteed term volume, with little supply for spot transactions. However, demand from downstream sectors such as PTMEG, GBL, PBT and spandex market was buoyant. One thing should be noted: Affected by continuously jumping price, some players on PU market have turned to use other more cost-effective materials instead of BDO. Buyers were cautious in purchasing under high price and mainly purchased to cover the most pressing demand. However, prices of BDO are expected to sustain firm as supply is tight and sellers are reluctant to sell, expecting price to surge. Supply of PTMEG was still in shortage and downstream players hoped upstream feedstock supply to be ample to guarantee production. Offers for PTMEG 1800 were mainly at 43,000-45,000yuan/mt in Mar, negotiable in actual transactions, up by 18,000-22,000yuan/mt compared with Feb. Demand for PTMEG was hot and prices of upstream and downstream products both climbed. Price of PTMEG is anticipated to hike further. Spandex market: Production cost of spandex hiked with surging BDO price and bigger increment of PTMEG in Mar. In addition, operating rate of downstream plants gradually ascended after Spring Festival holiday. Supported by sound demand and booming upstream market, prices of spandex extended higher. Current prices of spandex were mixed. The operating rate of spandex was still at 95%. Most spandex companies ran at full capacity now. Stocks of spandex climbed to 8 days, sustaining low. Spandex companies strongly intend to raise price boosted by growing rigid demand and mounting cost. In short run, prices of spandex are anticipated to move higher amid short supply but risk will enlarge too after price surged. Spandex inventory of some downstream players is around 15-30 days. Later procurement of downstream market should be noted. All in all, spandex value chain is still anticipated to extend higher in short run. Downstream order and procurement change should be concerned after price surged.

https://www.ccfgroup.com/newscenter/newsview.php?Class_ID=D00000&Info_ID=2103026520004

February 26, 2021

Wanhua Completes MDI Expansion in Yantai

The Technical Transformation Of MDI Device Expansion Is Completed, And Yantai Wanhua Is Firmly Established As A Global Leader!

[Feb 26, 2021]

On the evening of February 24, 2021, Wanhua Chemical issued an announcement stating that Wanhua Chemical’s Yantai Industrial Park had an original production capacity of 600,000 tons per year for the MDI plant. Technical transformation and expansion of ton/year. The project obtained the project record certificate in June 2019, and the cumulative investment of 284 million yuan by February 2021. The successful technological transformation of this project will further enhance the company’s ability to serve customers.

Wanhua MDI’s global production capacity reached 2.6 million tons

Global market share is 28%　

Wanhua’s Yantai MDI plant for this technological transformation and expansion belongs to the isocyanate integrated capacity expansion technological transformation project announced in the 2018 EIA and is the latest generation of technology. Compared with competitors, the capacity of a single device is generally only about 400,000 tons per year. Wanhua’s expanded device is the first device in the world to successfully achieve a single device capacity of 1.1 million tons per year.

The total investment of the project is 3.562 billion yuan, and the construction content includes:

MDI device (600,000 tons/year expansion to 1.1 million tons/year)

HDI and its adduct equipment (HDI 30,000 tons/year, HDI adduct 20,000 tons/year)

ADI equipment (HMDA and HMDI expanded from 10,000 tons/year to 20,000 tons/year

IPDI expanded from 15,000 tons/year to 30,000 tons/year),

Aniline plant (nitric acid plant 360,000 tons/year; nitrobenzene plant 48+240,000 tons/year; aniline plant 36+180,000 tons/year)

Hydrogen Chloride Plant (240 thousand tons/year)

HCL gas hydrochloric acid analysis device (226,000 tons/year) and supporting public works and auxiliary facilities

After the company’s Yantai MDI plant’s 500,000-ton/year technological transformation project is put into operation, its global production capacity will reach 2.6 million tons, with a market share of 28%, further consolidating its leading position in the polyurethane industry.　

What is the impact of capacity expansion on MDI prices?

We expect that this expansion will be at the right time and will have little impact on MDI prices. Assuming that after the expansion of Wanhua’s capacity, the output elasticity is 200,000 to 400,000 tons/year, that is, the average monthly new output in the market is 16.67 to 33,300 tons. However, overseas production capacity is 1.06 million tons/year due to force majeure, with an average monthly gap of at least 35,000 tons. Even if the new capacity is fully opened, Wanhua cannot meet the supply gap. Huaan Securities predicts that the cold wave will affect the supply of MDI in the United States for 1-3 months. The force majeure will bring about 66,000 tons of new export demand. The total new demand in the next 10 months is about 199,000 tons, corresponding to the operating rate In the range of Wanhua Chemical’s theoretical operating rate, it has little effect on prices.

https://www.jecibiochem.com/news/the-technical-transformation-of-mdi-device-exp-42927529.html

February 26, 2021

Wanhua Completes MDI Expansion in Yantai

The Technical Transformation Of MDI Device Expansion Is Completed, And Yantai Wanhua Is Firmly Established As A Global Leader!

[Feb 26, 2021]

On the evening of February 24, 2021, Wanhua Chemical issued an announcement stating that Wanhua Chemical’s Yantai Industrial Park had an original production capacity of 600,000 tons per year for the MDI plant. Technical transformation and expansion of ton/year. The project obtained the project record certificate in June 2019, and the cumulative investment of 284 million yuan by February 2021. The successful technological transformation of this project will further enhance the company’s ability to serve customers.

Wanhua MDI’s global production capacity reached 2.6 million tons

Global market share is 28%　

Wanhua’s Yantai MDI plant for this technological transformation and expansion belongs to the isocyanate integrated capacity expansion technological transformation project announced in the 2018 EIA and is the latest generation of technology. Compared with competitors, the capacity of a single device is generally only about 400,000 tons per year. Wanhua’s expanded device is the first device in the world to successfully achieve a single device capacity of 1.1 million tons per year.

The total investment of the project is 3.562 billion yuan, and the construction content includes:

MDI device (600,000 tons/year expansion to 1.1 million tons/year)

HDI and its adduct equipment (HDI 30,000 tons/year, HDI adduct 20,000 tons/year)

ADI equipment (HMDA and HMDI expanded from 10,000 tons/year to 20,000 tons/year

IPDI expanded from 15,000 tons/year to 30,000 tons/year),

Aniline plant (nitric acid plant 360,000 tons/year; nitrobenzene plant 48+240,000 tons/year; aniline plant 36+180,000 tons/year)

Hydrogen Chloride Plant (240 thousand tons/year)

HCL gas hydrochloric acid analysis device (226,000 tons/year) and supporting public works and auxiliary facilities

After the company’s Yantai MDI plant’s 500,000-ton/year technological transformation project is put into operation, its global production capacity will reach 2.6 million tons, with a market share of 28%, further consolidating its leading position in the polyurethane industry.　

What is the impact of capacity expansion on MDI prices?

We expect that this expansion will be at the right time and will have little impact on MDI prices. Assuming that after the expansion of Wanhua’s capacity, the output elasticity is 200,000 to 400,000 tons/year, that is, the average monthly new output in the market is 16.67 to 33,300 tons. However, overseas production capacity is 1.06 million tons/year due to force majeure, with an average monthly gap of at least 35,000 tons. Even if the new capacity is fully opened, Wanhua cannot meet the supply gap. Huaan Securities predicts that the cold wave will affect the supply of MDI in the United States for 1-3 months. The force majeure will bring about 66,000 tons of new export demand. The total new demand in the next 10 months is about 199,000 tons, corresponding to the operating rate In the range of Wanhua Chemical’s theoretical operating rate, it has little effect on prices.

https://www.jecibiochem.com/news/the-technical-transformation-of-mdi-device-exp-42927529.html

February 22, 2021

Butanediol Price Surge in China

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