Aluminum prices fluctuated sideways in May

According to the Commodity Market Analysis System of Business Society, the average price of domestic aluminum ingots in the East China market on May 30, 2023 was 18363.33 yuan/ton, a decrease of 0.69% compared to the aluminum price of 18490 yuan/ton at the beginning of the month (May 1).

In the long term, the current price is in the sideways range after a high price decline, and has been fluctuating in the range of 17500 to 19500 yuan/ton.

Cost reduction and improvement in aluminum ingot ton profit

The cost center of domestic electrolytic aluminum smelting continued to decline in May, mainly due to the downward movement of raw material prices, leading to an increase in profits per ton of aluminum.

Due to the downward movement of the prices of petroleum coke and coal tar pitch as raw materials for pre baked anode, the cost support is weak. In May, the price of pre baked anode continued its downward trend since the beginning of the year and continued to fall.

The main raw material is aluminum oxide. In 2023, the new production capacity of aluminum oxide in China will be approximately 6.3 million tons, with a renewable production capacity of over 10 million tons. Currently, the production capacity of aluminum oxide is in a pattern of oversupply. The domestic alumina production in April was slightly lower than in March, reaching 6.845 million tons, a decrease of 1.0% month on month and an increase of 11.9% year-on-year. It is understood that the newly built 1 million ton production capacity of Shandong Lubei Chemical has entered the trial operation stage, and the operating capacity of alumina is gradually being released. In addition, the continuous decline in raw material caustic soda and coal prices has led to a downward shift in the production cost of alumina.

1、 Price data

According to the Commodity Analysis System of Business Society, as of May 28th, the mainstream factory price of domestic refined and hydrogenated naphtha was 7601.50 yuan/ton, an increase of 0.83% compared to May 22nd at 7539.00 yuan/ton. The actual transaction price of refined and hydrogenated naphtha is around 7600 yuan/ton.

As of May 28th, the mainstream factory average price of locally refined straight-run naphtha in China was 7289.00 yuan/ton, an increase of 0.69% compared to May 22nd at 7239.00 yuan/ton. The actual transaction price of locally refined straight-run naphtha is around 7200-7400 yuan/ton.

On May 28th, the naphtha commodity index was 93.82, unchanged from yesterday, a decrease of 22.87% from the cycle’s highest point of 121.64 points (2022-03-10), and an increase of 122.11% from the lowest point of 42.24 points on July 19, 2016. (Note: The cycle refers to the period from September 1st, 2012 to the present)

2、 Analysis of influencing factors

This week, the price of refined naphtha has risen, with terminal restructuring and concentrated release of ethylene demand. Market trading has been positive and transactions have been good.

The international crude oil market fluctuated this week, mainly due to the pending US debt problem. Recently, there is still pressure from the macro side in the oil market, but the supply and demand side is relatively good, and the US gasoline consumption is strong; Combined with the continued interruption of exports from the Kurdish region of Iraq and the positive support of tight supply from oil producing countries such as OEPC+, oil prices have been boosted.

According to the monitoring of Business Society, the price of toluene has slightly increased this week, reaching 7050.00 yuan/ton on May 22 and 7130.00 yuan/ton on May 28, an increase of 1.13%. The price of mixed xylene has slightly increased this week, reaching 7390 yuan/ton on May 22 and 7470 yuan/ton on May 28, an increase of 1.08%. The price trend of PX this week is temporarily stable. As of the weekend, the factory price of domestic paraxylene is 8300 yuan/ton, which is the same as the price of 8300 yuan/ton at the beginning of the week.

3、 Future Market Forecast

Energy analysts from Business Society believe that this week, the terminal restructuring of local refining naphtha and the concentrated release of ethylene demand have led to positive market trading and good transactions. Refineries are actively driving up prices, and it is expected that local refining naphtha may continue to rise in the near future.

According to the commodity market analysis system of the business community, the price of domestic polyester staple fiber market was temporarily stable this week (5.22-5.26). As of May 26, the average ex factory price was 7485 yuan/ton, unchanged from the beginning of the week. At present, some factories for polyester staple fibers are facing tight shipments, and processing fees continue to be repaired. The cost side PTA has rebounded, but the demand is still insufficient.

After late May in the PX market, with the restart of some domestic devices and an increase in domestic PTA device maintenance, PX supply has eased and prices have also eased. However, the PTA device was shut down for maintenance as planned, and the PTA operating rate dropped to around 74%. The temporary shutdown to support the PTA price stopped falling, with an increase of 0.66% this week.

Driven by the sentiment of buying up rather than buying down, the operating rate of downstream yarn factories has slightly improved, replenishing inventory as needed, and producing regular variety orders on the machine. Raw material procurement is mainly short and small orders. Overall, there is currently a lack of follow-up on orders from terminal textile enterprises, with significant fluctuations in raw material prices, and a strong wait-and-see atmosphere in some parts, resulting in a slowdown in yarn factory sales.

Analysts from Business Society believe that there have been more recent PTA inspections, improved supply and demand margins, phased market destocking, and enhanced cost support. Downstream demand procurement is the main focus, with a strong wait-and-see attitude, and the price of polyester staple fibers is mainly stagnant towards the end of the month.

According to the Commodity Market Analysis System of the Business Society, the prices of domestic polyester filament have slightly rebounded recently. As of May 25th, mainstream polyester filament factories in Jiangsu and Zhejiang regions have quoted prices of 7350-7750 yuan/ton for polyester POY (150D/48F), 8700-9200 yuan/ton for polyester DTY (150D/48F low elasticity), and 8050-8400 yuan/ton for polyester FDY (150D/96F).

Recent average price fluctuations in the polyester filament market Unit: yuan/ton

Product/ May 19th/ May 25th/ Up and down/ Year-on-year increase and decrease

Polyester DTY/ 8883./ 8898./ 0.17%./ -9.43%

Polyester FDY/ 8154./ 8176./ 0.27%./ -10.53%

Polyester POY/ 7431./ 7465./ 0.45%./ -13.87%

The unexpected significant decline in US crude oil inventories, coupled with a public speech by the Saudi Energy Minister, has raised concerns about further production cuts by OPEC+, an oil producing country. On May 24th, international crude oil futures rose. The settlement price of the main contract for WTI crude oil futures in the United States was $74.34 per barrel, an increase of $1.43 or 2.0%. The settlement price of the Brent crude oil futures main contract was $78.36 per barrel, an increase of $1.52 or 2.0%.

In May, the PTA maintenance equipment in China remained concentrated, and the industry’s operating rate has been lowered to below 75%. Supply is expected to shrink, with short-term supply reduction and demand increase, and the accumulation of inventory decreasing. On May 25, the price of domestic PTA spot market rose slightly, and the average price in East China was 5599 yuan/ton, up 1.27% from May 16.

Driven by the warming atmosphere at the raw material end, there are replenishment actions downstream, and the weaving enterprise’s start-up rate has slightly increased to over 60%. However, the current textile market orders are still dominated by rigid orders, and new foreign trade orders are also relatively weak, resulting in a relatively small overall order volume.

Analysts from Business Society believe that the crude oil market is relatively strong, with more short-term PTA maintenance. However, processing fees have gradually been fixed with the decline of PX, and it is expected that the enthusiasm for subsequent construction will increase. With the restoration of profits, the construction of polyester factories has rebounded, but its sustainability is difficult to maintain, and the downstream terminal market is weak and showing signs of fatigue. It is expected that in the short term, the cost side atmosphere will improve and the price of polyester filament will stabilize and rise, but there is still some pressure on the demand side.

The domestic acetic acid market is stable and wait-and-see, with no pressure on corporate inventory. We maintain active shipments and follow up on demand when entering the market downstream. The market trading atmosphere is acceptable, and the industry has a wait-and-see mentality. Supply and demand are relatively balanced, and the price trend of acetic acid is stable and operating.

According to the Commodity Market Analysis System of the Business Society, as of May 21, the average price of acetic acid in East China was 3300.00 yuan/ton, which is the same as the price of 3300.00 yuan/ton on May 15 and an increase of 2.06% compared to the beginning of the month. As of May 21, the market prices of acetic acid in various regions in the week were as follows:

The upstream raw material methanol market has fluctuated and declined. As of May 21, the average price in the domestic market was 2282.50 yuan/ton, a decrease of 2.28% compared to the price of 2335.83 yuan/ton on May 15. Futures prices fell, raw coal remained weak, downstream demand remained weak for a long time, social inventory accumulated in the methanol market, and imported goods also continued to pour in, so the price of methanol spot market declined.

The downstream acetic anhydride market is on the rise. As of May 21, the factory price of acetic anhydride was 5480.00 yuan/ton, which is the same as the price of 5480.00 yuan/ton on May 15. Upstream acetic acid prices have stabilized, and the supply of acetic anhydride costs has remained stable. Downstream procurement of acetic anhydride follows up on demand, and market negotiations have been conducted. The price of acetic anhydride is mainly stabilizing.

In the future market forecast, acetic acid analysts from Business Society believe that the current supply of acetic acid in the market remains rational, enterprises maintain a pace of shipment, and downstream parties follow up on demand. The market trading atmosphere is acceptable, and the industry is expected to have a wait-and-see attitude. It is expected that the acetic acid market will consolidate and operate in the future, and specific attention will be paid to downstream follow-up.

1、 Price trend

According to the commodity analysis system of the business agency, the price of neopentyl glycol in the domestic market fell slightly this week. This week, the average price of the mainstream market of neopentyl glycol in China dropped from 10766.67 yuan/ton at the beginning of the week to 10633.33 yuan/ton at the end of the week, a decrease of 1.24%. Weekend prices fell by 36.83% year-on-year. On May 21, the new pentanediol commodity index was 51.24, unchanged from yesterday, a decrease of 50.55% from the cycle’s highest point of 103.61 points (2021-09-22), and an increase of 19.02% from the lowest point of 43.05 points on November 28, 2022. (Note: The cycle refers to the period from September 1st, 2021 to present)

2、 Market analysis

The price of neopentyl glycol in the mainstream market fell slightly this week.

From the perspective of neopentyl glycol upstream raw material market, the domestic isobutyraldehyde market price fell sharply this week. This week, the average price of domestic isobutyraldehyde mainstream market fell from 9200.00 yuan/ton at the beginning of the week to 8533.33 yuan/ton at the end of the week, a decline of 7.25%. Weekend prices fell 47.65% year-on-year. The price of upstream raw material market fell sharply, and the cost support weakened. Affected by the supply and demand, the price of neopentyl glycol was negatively affected.

3、 Future prospects

In late May, the trend of the new pentanediol market may fluctuate slightly and decline mainly. The upstream isobutyraldehyde market has significantly declined, and cost support has weakened. The downstream paint market is average, and the enthusiasm for downstream procurement is average. Analysts from Business Society believe that in the short term, the market for new pentanediol may experience slight fluctuations and declines due to various factors such as supply and demand, as well as raw materials.

1、 Price trend

According to the analysis system of the commodity market of the Business Society, the average price of PS at the beginning of this week was 9566 yuan/ton, and the average price of PS at the weekend was 9500 yuan/ton. The price decreased slightly by 0.70%, a decrease of 11.63% compared to the same period last year.

2、 Market analysis

The international crude oil market closed down, styrene prices rose and explored, while downstream buying followed up poorly, making it difficult for merchants to boost their confidence. The mainstream price of GPPS (polyphenylene sulfide) in the East China market is between 8400 and 10050 yuan/ton, while the mainstream price of HIPS (polystyrene) is between 9000 and 10400 yuan/ton.

3、 Future Market Forecast

The downstream purchasing interest of PS is not good, and it is expected that the PS (polystyrene) market will be mainly volatile and weak in the short term.

Commodity Market: According to the Commodity Market Analysis System of Business Society, the mainstream market of polyacrylamide (CPAM, cationic, molecular weight 12 million, 10-30 ionic degree) in China showed a slight downward trend in the first half of May 2023. Among them, on the 1st, the market reported around 14728 yuan/ton, and on the 15th, the market reported around 14528 yuan/ton, a half month decline of 1.36%.

As shown in the figure, the polyacrylamide market in China has been weakening for several weeks since 2023. The weekly decline in April has expanded, and the decline in the first half of May has slightly narrowed. From the market, it is known that the demand in the water treatment industry has been unfavorable, with normal production from manufacturers in the main production areas and sufficient spot supply in the market. The situation of weak supply and demand has not been improved, resulting in the market not being able to rise and “business is difficult to do”. The polyacrylamide market has not shown any signs of improvement.

Raw material acrylonitrile: According to the commodity market analysis system of the Business Society, the acrylonitrile market initially fluctuated upwards in May and then slightly rebounded. As of May 15th, the bulk water price in the acrylonitrile market was 9812.5 yuan/ton, an increase of 1.55% from 9662.5 yuan/ton at the beginning of the month. However, the highest price point at this stage was 9862.5 yuan/ton from May 9-14. At present, the supply pressure of acrylonitrile has slightly eased, and although there is still strong demand support, the demand side has weakened compared to the previous period. In addition, the cost side is declining, and it is expected that the acrylonitrile market will fluctuate slightly in the short term.

Raw Material Acrylic Acid: According to the Commodity Market Analysis System of the Business Society, the acrylic acid market fluctuated and declined in the first half of May. Among them, this month’s premium grade acrylic acid market in East China reported around 6800 yuan/ton on the 1st, but dropped to 6375 yuan/ton on the 15th, a decrease of 6.25%. Recently, the market price of raw propylene has fallen slightly, the cost support is slightly weak, and the operating rate of the supply side industry is slightly lower than that of the previous period. However, the demand side performance is general, the market trading atmosphere is light, manufacturers are active in shipping, and the focus of acrylic acid negotiation has declined in a narrow range. It is expected that the acrylic market will wait and see the narrow range finishing operation in the short term.

Liquefied natural gas for production. According to the Commodity Market Analysis System of Business Society, the domestic liquefied natural gas prices continued to fluctuate slightly after a significant decline in the first half of May, with a weak trend. Among them, the average price of liquefied natural gas in China on May 1st was 4416 yuan/ton, and on May 15th it was 3964 yuan/ton, a half month decrease of 10.24%.

Future forecast: Both raw material and fuel prices will decline in May, and the overall cost of polyacrylamide will continue to be weak. The prosperity of China’s water treatment industry continues to be low, with manufacturers in the main production areas producing normally and abundant in stock. Downstream demand has not improved and there is a lack of enthusiasm. Regarding the future market, the polyacrylamide market will continue to be mainly weak.

According to data from Business News Agency, the domestic maleic anhydride market has been declining this week. As of May 14, the average market price of n-butane oxidation maleic anhydride remained at 7370.00 yuan/ton, a decrease of 2.90% compared to May 8′s price of 7590.00 yuan/ton, and a decrease of 7.18% compared to the same period last month.

On May 14th, the maleic anhydride commodity index was 69.43, unchanged from yesterday, a decrease of 58.28% from the cycle’s highest point of 166.43 points (2021-12-15), and an increase of 35.66% from the lowest point of 51.18 points on April 14th, 2020. (Note: The cycle refers to the period from September 1st, 2011 to the present)

At present, the domestic benzene based maleic anhydride market is gradually starting to operate. Recently, the downstream resin market has been weak, and the enthusiasm for replenishment of maleic anhydride is average. The international crude oil market is weak, coupled with a significant decline in the price of raw material n-butane, and the maleic anhydride market continues to decline. As of the 14th, the solid anhydride in Shandong region is around 6800 yuan/ton, Jiangsu region is around 6800 yuan/ton, and South China region is around 7200 yuan/ton.

On the upstream side, the price of pure benzene fell this week, with an average price of 7190 yuan/ton on May 8th and 7110 yuan/ton on May 12th, a decrease of 4.24%. The factory price of hydrogenated benzene in North China has been lowered, from 7200 yuan/ton last weekend to 7066.67 yuan/ton this weekend, a decrease of 1.85%. The market for n-butane has significantly declined this week, with prices in Shandong reaching around 4700 yuan/ton as of May 14th.

Business Society maleic anhydride product analysts believe that the current market for n-butane in the upstream of maleic anhydride has significantly declined, while the downstream resin market is weak. In addition, the international crude oil market is weak, resulting in a strong wait-and-see sentiment in the market. It is expected that the maleic anhydride market will be dominated by consolidation in the near future.

Overview of ethylene glycol market

According to data from Business News Agency, on May 12th, the average price of domestic oil to ethylene glycol was 4258.33 yuan/ton, with prices in various regions as follows:

The price range for spot goods executed by mainstream manufacturers in East China is between 3950-4350 yuan/ton; The spot price of ethylene glycol in the South China market is 4200 yuan/ton, while the price range for mainstream manufacturers in Central China is 4100 yuan/ton; The spot price for mainstream manufacturers in North China is 4300 yuan/ton.

List of International CIF Prices

On May 12th, the CIF price of ethylene glycol in China was 515 US dollars/ton,; The CIF Southeast Asia price is 528 US dollars/ton.

Starting to destock ethylene glycol port inventory

At present, inventory is still relatively high. As of May 11th, the inventory of ethylene glycol at the East China main port was 940900 tons, and it began operating in the range of less than 1 million tons. Recently, the main reason for going to the warehouse is that the pace of port shipments has increased. In addition, the number of ports this week is relatively small, and it is expected that the landing month on month ratio will increase next week.

Expected growth in overseas supply in May, with off-season maintenance in China

Some maintenance devices in North America and Saudi Arabia have been restarted, and the overseas supply increment is clear. Some existing maintenance devices have plans to restart, so it is expected that ethylene glycol production may increase slightly in May. On the domestic side, some enterprises have started to carry out maintenance and cash in.

Downstream demand is weak

Downstream, the scale of polyester maintenance has increased, and the polyester load continues to decline, mainly because the terminal is temporarily unable to withstand high priced raw materials, and the operating rate of the weaving machine has decreased. On the one hand, the expectation of overseas economic recession is strong, and terminal foreign trade is mainly dominated by small and medium-sized orders, and the export situation is not optimistic; On the other hand, May is about to usher in the textile off-season, and the current poor acceptance of new orders in the textile market may lead to a decrease in the weaving start-up rate. The negative feedback from the bottom up of terminal shutdown is heating up, and the polyester production reduction continues, which may weaken the demand for raw material ethylene glycol.

Weak upward momentum on the spot end

At present, the average spot price of ethylene glycol is within a relatively low range in history, but the supply pressure of ethylene glycol is still in the short term. In terms of demand, the start of terminal looms has slightly weakened, and some polyester factories are still in a low start state, suppressing the upward trend of ethylene glycol prices; The fundamentals of ethylene glycol are still weak.

Ethylene glycol has been at a negative profit level for a long time, and is currently mainly supported by the weakening of supply caused by mid to long-term production changes and the expected improvement in downstream demand; We still need to wait and see the specific expected landing performance.

It is expected that in the short term, the probability of weak and volatile ethylene glycol trading in the future will increase, with an average price range of around 3950-4250 yuan/ton.