Market summary: This week, acrylonitrile prices hit the cost line, and the market downturn has slowed down. At present, the price of acrylonitrile has fallen below the level before the price increase in early January and has dropped to below 9000 yuan/ton, gradually approaching the theoretical production cost line. Acrylonitrile single products have already shown a loss state. As of March 7th, the mainstream negotiation for container self pickup in East China ports is around 8700-8900 yuan/ton, and the negotiation for short distance delivery in Shandong market is around 8600-8800 yuan/ton.
| Gamma-PGA (gamma polyglutamic acid) |
Supply side: Currently, the capacity utilization rate of the acrylonitrile industry remains at a relatively high level of around 89%, and although the domestic demand and export situation have improved, the overall supply is surplus. But as the price of acrylonitrile gradually approaches the cost line, the market’s expectations for future supply cuts have strengthened, and some factories have also released plans for maintenance or load reduction in order to have a stabilizing effect on the market. Considering the expectation of a bottoming out in the market and the improvement in downstream buying intentions, the market decline is gradually narrowing.
High inventory: Overall supply surplus. According to statistics, as of March 5th, the inventory of domestic acrylonitrile factories was around 50000 tons, an increase of+0.1 million tons from last week, and the inventory was at a high level.
On the demand side: In March, the main downstream industries of acrylonitrile showed an increase in operating load, with ABS maintaining above 70%, acrylic gradually recovering to above 70%, and acrylamide slowly increasing to nearly 60%, resulting in an overall increase in consumption. In addition, as domestic prices fall to low levels, the export arbitrage window opens again, and spot negotiations resume, it is expected that export volume will significantly increase in April and May.
Market forecast: In the short term, the acrylonitrile market will continue to bottom out, waiting for factory production cuts to take effect, and the improvement of supply and demand relations will still take time. However, new production capacity will gradually follow suit in the future. From late March to April, Yulong Petrochemical, Sinochem Quanzhou, and Zhenhai Refining and Chemical’s new acrylonitrile units are all planned to be put into operation, and the supply from north to south will still increase at that time. Therefore, with the expectation of reduced production in existing facilities and the release of new capacity, the acrylonitrile market is expected to hit bottom but lacks momentum for rebound.
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