Price Trend

Market consolidation of maleic anhydride this week (6.17-6.21)

According to data from business associations, the average price of maleic anhydride offer by the end of the weekend was 6550.00 yuan/ton (including taxes), and the offer was weak.

II. Market Analysis

Product: This week, the domestic maleic anhydride market as a whole continued to decline.

Industry chain: First of all, unsaturated resin continued to operate weakly this week. Resin factories mainly purchased on demand, and domestic maleic anhydride market weakened. Secondly, mainstream factories continued to offer excessive prices, and the current market supply exceeds demand. The fluctuation of crude oil in the periphery affects the market mentality, and the rise of Crude Oil supports the market to a certain extent. The rise of oil price leads to the rise of pure benzene price in the upstream raw material, while the price of n-butane is still hovering at a low price, the market supply is sufficient, and the downstream is still in the off-season. In the short run, the profit margins of maleic anhydride by benzene and butane methods remain stable. Finally, at present, downstream warehouse replenishment is cautious, and factories are mainly on the lookout.

3. Future Market Forecast

At present, domestic maleic anhydride market may stop falling and stabilize in the near future, with prices rising slightly, according to analysts of maleic anhydride products of Business Society Chemical Branch.

Commodity Index: On June 21, the polyaluminium chloride commodity index was 104.50, which was the same as yesterday. It was 3.34% lower than the peak of 108.11 points in the cycle (2019-04-24), and 3.57% higher than the low of 100.90 points on April 09, 2019. (Note: Period refers to 2019-04-01 to date)

Latest price (June 21): Polyaluminium chloride (solid, content (> 28%) quoted 1933.33 yuan/ton.

Main points of analysis: On June 1, the mainstream quotation of domestic polyaluminium chloride market was about 1950 yuan/ton, and on June 21, the market price of the product did not change much. The mainstream quotation was reported to 1933.33 yuan/ton, with a fluctuation of less than one point. According to the monitoring data of the commercial association (100ppi.com), the current domestic market quotation range of polyaluminium chloride is about 1800-1900 yuan/ton for solid polyaluminium chloride (industrial grade, content (> 28%) and 330-410 yuan/ton for liquid (industrial grade, content 10-12%).

Industry chain: Prices of upstream hydrochloric acid and other products of polyaluminium chloride have not changed much in recent years; downstream demand is basically stable, and the overall price of polyaluminium chloride has fluctuated slightly in recent years.

Future market forecast: In the short term, if there is no big fluctuation in the price of raw materials in the upstream, the demand in the downstream is relatively stable, and the market price of domestic polyaluminium chloride is basically stable.

Price Trend

According to the price monitoring of business associations, the market of potassium sulphate has been stable this week, and the price of potassium sulphate in northern China has increased due to insufficient supply.

II. Market Analysis

At present, the arrival price of 50% water and salt powder in Qinghai is more than 2550 yuan per ton. Mannheim’s quotation remains relatively high, and 52% water-soluble shipment is still the main one. The ex-factory price is more than 3000 yuan/ton, but the 50% content of potassium sulfate is almost unavailable. Southern tobacco bidding will begin one after another. Three tendering plans have been announced. Fujian tobacco bidding is 33.553 million tons of potassium sulfate, Liangshan Golden Leaf bidding is 14.5 million tons of potassium sulfate, Sichuan Golden Leaf bidding is 11,000 tons of Mannheim potassium sulfate. The total bidding volume reaches 59,000 tons of potassium sulfate. The total amount of potassium sulfate has increased compared with last year, or will form a favorable support for the potassium sulfate market. The price of Mannheim potassium sulfate is basically stable. The mainstream factory price of 50% of the powder is 2800-3100 yuan/ton, and the factory price of 52% of the powder is 3000-3200 yuan/ton. The price in South China is relatively high. The arrival price of 52% Luo Potassium powder is 2680-2700 yuan/ton, and the water and salt 50 powder Market in Northwest China is 2550-2600 yuan/ton.

3. Future Market Forecast

Potassium sulfate analysts at the business association believe that the market of potassium sulfate will stabilize mainly in the short term.

I. Price Trend Chart of Sodium Pyrosulfite in China

According to the monitoring of business associations, the price of sodium pyrosulfite in China was slightly weak this week. The average price of industrial grade sodium pyrosulfite at the beginning of the week was 1900 yuan/ton, and the average price at the end of the week was 1883.33 yuan/ton, down 0.88%.

II. Market Analysis

Product: This week, the overall performance of the sodium pyrosulfite market remains unchanged. The main market price range of industrial grade sodium pyrosulfite is between 1800 and 2000 yuan/ton, and most of the prices are around 1900 yuan/ton. Traditional off-season makes domestic pyrosulfite inventory relatively abundant. Enterprises continue to focus on fulfilling the orders of old customers. The market turnover atmosphere is general, and the overall market continues to maintain fast-moving and fast-moving market. This week, some domestic manufacturers again slightly reduced their ex-factory prices, which led to a slight decline in domestic market prices of sodium pyrosulfite again this week. (The above prices refer to the foreign quotations of the mainstream domestic enterprises, some of which are not reported for the time being. The prices are for reference only. They have nothing to do with the final pricing of the manufacturers. For details, please contact the manufacturers for consultation.

Industry chain: This week, domestic prices of sulphur and soda are relatively stable. Upstream raw material prices continue to operate at the bottom. Under the pressure of cost, the market price of sodium pyrosulfite is warming and pressurized.

3. Future Market Forecast

Business analysts believe that low raw material costs are suppressed, downstream demand remains weak, and the domestic market price of sodium pyrosulfite is expected to continue to operate slightly weaker in the short term.

On June 20, the ammonium nitrate commodity index was 103.51, which was the same as yesterday. It was 12.59% lower than the cycle peak of 118.42 points (2019-01-15), and 33.79% higher than the lowest point of 77.37 on October 31, 2016. (Note: Period refers to 2013-02-01 to date).

Recently, the price trend of domestic ammonium nitrate Market is temporarily stable. Affected by environmental protection control, domestic ammonium nitrate plant shuts down more, domestic ammonium nitrate plant starts less, but with the warming of the weather recently, the influence of northern air limitation disappears. In addition, due to the complete shutdown of domestic downstream civil explosion industry, domestic ammonium nitrate manufacturers have more stockpiles, and the price trend in the field declines. As of the 20th day, the domestic ammonium nitrate market price negotiations in 1900-2050 yuan/ton, affected by environmental protection, so now many manufacturers in many areas are forced to limit production or stop production and maintenance for environmental protection inspection, the price trend of ammonium nitrate on the site is temporarily stable.

In recent years, domestic nitric acid price trend has been temporarily stable, up to 20 days, the market price is 1760 yuan/ton. The rising trend of nitric acid price has a positive impact on the ammonium nitrate market. The price trend of ammonium nitrate is stable. The price trend of upstream raw material liquid ammonia has slightly declined. As of 20 days, the price quoted by manufacturers in the northern region has been maintained in the range of 3000-3400 yuan/ton, while that in the northwest region is around 290-3000 yuan/ton. The declining price trend of cruise raw materials has a negative impact on the ammonium nitrate market, and the price trend of ammonium nitrate Market is temporarily stable. At the end of the peak season of the downstream civil explosion industry recently, the demand for ammonium nitrate has weakened and the stocks of ammonium nitrate manufacturers have increased, but the liquid ammonia market is on the rise again. The ammonium nitrate Market is shaking at a low level because of the bad market. Ammonium nitrate analysts believe that the recent upstream raw material market price shocks, but the downstream demand is not good, ammonium nitrate market prices are expected to remain low in the latter part of the shocks.

On June 20, the PX commodity index was 58.40, unchanged from yesterday, down 42.97% from its peak of 102.40 points in the cycle (2013-02-28), and up 28.21% from its low of 45.55 points on February 15, 2016. (Note: Period refers to 2013-02-01 to date).

According to statistics, the domestic market price trend of p-xylene was temporarily stable on the 20th day. Pengzhou Petrochemical Plant operated steadily in the field. Urumqi Petrochemical Plant started 50% of its operation. Fuhai Aromatic Hydrocarbon Plant started one line. CNOOC Huizhou Refinery and Chemical Plant overhauled. Hengli Petrochemical PX Plant was put into operation. Other units operated steadily temporarily. Since the new plant was put into operation, the domestic market for p-xylene was normally supplied. The price trend of toluene market is stable for the time being. The opening rate of PX plant in Asia is about 80%. On June 19, the closing price of p-xylene in Asia increased by 7 US dollars/ton. The closing price is 788-791 US dollars/ton FOB in Korea and 807-809 US dollars/ton CFR in China. More than 50% of the domestic units need to be imported. The rise of foreign prices has a positive impact on the domestic market price of p-xylene. The price trend of p-xylene in the market is stable.

On June 19, WTI crude oil in July fell to 53.76 U.S. dollars per barrel, a decline of 0.14 U.S. dollars. Brent crude oil in August fell to 61.82 U.S. dollars per barrel, a decline of 0.32 U.S. dollars. Crude oil prices declined, which lost some cost support for downstream petrochemical products prices, and the price trend of paraxylene market was temporarily stable. Recently, the textile industry has been stabilizing, PTA price has risen slightly on the 20th day. The average price in East China is raised near 5800-5950 yuan/ton. As of the 19th day, the domestic PTA start-up rate is about 88.5%, the polyester industry start-up rate is about 88.5%, and the downstream production and sales rate remains high. However, PTA market price shocks, and the price of PX market is expected to be low in the later period.

Global Data said on June 17 that global polyethylene production is expected to grow substantially in the next five years, from 101.2 million tons per year in 2018 to 157.02 million tons per year in 2023, and that under the leadership of Asia and North America, global polyethylene production will grow by 43%.

According to the company’s report, “Prospects for the global polyethylene industry by 2023 – forecasts of capacity and capital expenditure, and details of all the factories under operation and planned construction” show that there are about 159 planned and announced construction factories in the next five years, mainly in Asia and the Middle East.

Asian polyethylene production capacity is expected to increase from 39.87 million tons per year in 2018 to 57.1 million tons per year in 2023, with an average annual growth of 7.2%. By 2023, China’s production capacity in the region will increase by 7.56 million tons per year. The main new capacity will come from Dushanzi Polyethylene Plant No. 2 of Dushanzi Petrochemical Co., Ltd. and will reach 600,000 tons per year by 2023.

Dayan and Kharade, oil and gas analyst at GlobalData, said: “In Asia, China, with its large population and growing economy, is expected to see continued growth in polyethylene demand. To meet this demand, China will substantially increase production capacity. China will account for more than 40% of Asia’s new polyethylene production capacity.

GlobalData points out that North America is the second most productive region in the global polyethylene industry. It is expected to increase from 23.15 million tons per year in 2018 to 33.82 million tons per year in 2023, with an annual growth rate of 7.6%. Most of the increased polyethylene production capacity came from the United States, with a capacity of about 9.35 million tons per year by 2023. The main new capacity will come from factories, ExxonMobil Bomont High Performance Polyethylene Plant and Chevron Phillips Chemical Company Pasadena Polyethylene Plant, with annual capacity of 1.3 million tons and 9.9 million tons respectively.

In the Middle East, polyethylene production capacity is expected to increase from 20.8 million tons per year in 2018 to 28.52 million tons per year in 2023, with a compound annual growth rate of 6.3%. By 2023, Iran’s oil production capacity will increase by about 5.54 million tons per day. The new capacity mainly comes from NPC Hormozgan Polyethylene Plant 1 and NPC Hormozgan Polyethylene Plant 2. By 2023, their capacity will reach 500,000 tons per year.

Kharade added: “For North America and the Middle East, low-cost, abundant natural gas supply is the main reason for the surge in polyethylene production capacity. In addition to the advantages of raw materials, the target export to other US countries is also the reason for the substantial increase in U.S. production capacity.

The production capacity of polyethylene in Russia is expected to increase from 2.95 million tons per year in 2018 to 9.16 million tons per year in 2023, with a compound annual growth rate of 22.6%. Russia is expected to become the largest oil producer in the region by 2023, with an annual capacity increase of 4.63 million tons. The new capacity mainly comes from the Nakhodka polyethylene plant of Far East Petrochemical Co., Ltd. and will reach 880,000 tons per year by 2023.

Africa is the fifth highest, increasing from 2.05 million tons per year in 2018 to 4.7 million tons per year in 2023, with a compound annual growth rate of 16.6%. Egypt is ahead of Africa in terms of capacity growth and is expected to increase capacity by 1.35 million tons per year by 2023.

Badlands NGLS, Petroleum and Natural Gas and Royal Dutch Shell are the top three companies in the world that plan to increase production capacity in the future.

Alexander Djukov, chairman of Russia’s 3rd largest oil company, Gazprom Neft, said in Moscow on the 17th that OPEC and its partners should start increasing oil production to maintain adequate market supply and reasonable prices. The statement echoes Moscow’s reluctance to agree to extend Saudi Arabia’s earlier cuts.

Mr. Djukov said the price range of $55 to $65 a barrel was “acceptable” for Russian oil producers, adding that once the cuts were lifted, Russian gas oil would be able to rapidly increase production.

Russia is more satisfied with lower oil prices than Saudi Arabia. They also endorsed the comments made by the head of the Russian oil company, Sheikin. Shetchen said the cut affected Russian companies’market share and was good for American producers.

“Would it make sense for Russia to reduce oil production if the United States immediately seized our market share? We have to defend our market share,” Schechin said. The executive went on to say that if the cuts expand, Russian oil companies will ask the Russian government for compensation.

“With the next OPEC meeting approaching in early July, we may hear more similar remarks,” he said. Russian oil producers have never really agreed to cut production, but the large-scale pollution of the Druzhba oil pipeline to Europe forced Russian oil producers to cut production and reduce production to within the OPEC quota.

In a letter Tuesday, the chairman of the Organization of Petroleum Exporting Countries (OPEC) said that OPEC and its allies, led by Russia, would face the problem of planning crude oil exports if they could not determine the date for an emergency meeting, according to the Wall Street Journal’s Chinese website.

According to the report, in a document circulated within OPEC, Manuel Quevedo, Chairman-in-Office of OPEC and Minister of Petroleum of Venezuela, said that there was an urgent need for OPEC to hold a meeting to decide on plans for at least the second half of this year.

The current 1.2 million barrels per day cut-off agreement expires on July 1, and next month’s crude oil export quota has been set, Kweido said. Kwedo suggested that the meeting be held on July 1-2, while Iran and Russia proposed that the meeting be held on July 10-12, which was postponed from June 25-26 at the request of Russia.

According to the Shanghai Securities News, in order to balance the supply and demand of crude oil market, OPEC+ (OPEC and its production reduction alliance) reached an agreement last year to reduce production from January 1 this year to avoid oversupply. Under the agreement, they cut production by 1.2 million barrels a day for six months, based on October output last year. Now, the cut-off agreement is about to expire. The OPEC Conference, originally scheduled for the end of June this year, will decide whether or not to continue to implement the reduction agreement and how much reduction will be made.

According to the report, Emirates Minister of Energy Mazrui said last week at the International Economic Forum of the Americas that, in view of existing oil stockpiles, the cut-off agreement should continue to be maintained or “extended at least until the end of the year”. He said that “the right decision is to postpone” and expressed his support for “OPEC+” action to continue to reduce production.

According to Dow Jones, the International Energy Agency (IEA) said on Friday that the global economic cooling may mean a slowdown in oil demand growth in 2019, even if oil producers maintain adequate supplies.

In its highly watched oil market report, the International Energy Agency (IEA) lowered its forecast for global oil demand growth for the second month in a row, from 1.3 million barrels a day last month to 1.2 million barrels.

The IEA said that after struggling to cope with supply concerns in recent months, the main focus of the oil market was oil demand, as the economy was weak, on the grounds that global trade growth had reached its lowest level in 10 years, as well as the warm winter in Japan and the weakness of the petrochemical industry in Europe.

This is the third major oil market report this week that is more pessimistic about oil demand. Earlier, the US Energy Intelligence Agency (EIA) released pessimistic demand data on Tuesday and OPEC expressed the same pessimism on Thursday.

Although demand growth is slowing, meeting expected demand growth is unlikely to be a problem, the IEA said, noting that the United States will contribute 90% to the 1.9 million barrels per day supply growth in non-OPEC countries.

The agency said that, combined with uncertainties in demand, when it meets in Vienna later this month to discuss extending the cut-off period, OPEC members and their allies will consider “sustained supply growth from competitors”.

OPEC and its allies cut production at the end of 2018. Previously, concerns about global economic growth led to a fall in oil prices.

Many Saudi officials have said that the country wants to extend the cut to the second half of 2019. The IEA report showed that Saudi Arabia’s implementation rate of output reduction in May was 290%, as the country reduced its daily production by 110,000 barrels. This led to OPEC’s lowest supply since 2014.

However, OPEC’s compliance was inconsistent, with Iraq increasing its oil supply by 130,000 barrels in May.

Analysts said the extension of production cuts largely depends on Russia, and senior oil industry figures expressed concern that market share was taken away by the United States. Russia’s production fell by 120,000 barrels on May, but the IEA attributed this to the suspension of production after the pollution of the Druzba pipeline.

The IEA said that, in addition to other planned disruptions and maintenance activities, the disruption of this critical pipeline led to the lowest start-up of global refineries in two years.

Although global oil investors will continue to focus on demand and global economic growth, the supply risks that dominated the market earlier this year have not dissipated.