Recently, the domestic titanium dioxide industry experienced the fourth round of collective price increases during the year. However, due to the underutilization of downstream real estate and other industries and the impact of declining demand, the price of titanium dioxide still fell by more than 20% compared with the price of 20,000 yuan per ton at the beginning of the year. The high fell by about 30%.
1. The price of more than 60 kinds of chemical products fell, and the entire coating industry chain “collapsed”
Looking at the chemical market in 2022, it can be described as desolate, and the scattered price increase letters have not changed the tragic situation of weak orders and lost support in the chemical market.
Compared with the quotations at the beginning of 2022, the prices of more than 60 chemical products have fallen, among which the prices of BDO have fallen by 64.25%, the prices of DMF and propylene glycol have fallen by more than 50%, and the ton prices of spandex, TGIC, PA66 and other products have fallen by more than 10,000 yuan.
In addition, in the coatings industry chain, the upstream solvents, additives, pigments and fillers, film-forming substances and other raw material industry chains have also experienced price declines.
In terms of organic solvents, the price of propylene glycol fell by 8,150 yuan/ton, a drop of more than 50%. The price of dimethyl carbonate fell by 3,150 yuan/ton, a drop of 35%. The ton prices of ethylene glycol butyl ether, propylene glycol methyl ether, butanone, ethyl acetate, and butyl acetate all fell by more than 1,000 yuan, or about 20%.
The price of liquid epoxy resin in the resin industry chain fell by 9,000 yuan/ton, or 34.75%; the price of solid epoxy resin fell by 7,000 yuan/ton, or 31.11%; the price of epichlorohydrin fell by 7,800 yuan/ton, or 48.60%; The price of bisphenol A fell by 6,050 yuan/ton, a drop of 33.43%; the price of indoor polyester resin in the upstream of powder coatings fell by 2,800 yuan/ton, a drop of 21.88%; the price of outdoor polyester resin fell by 1,800 yuan/ton, a drop of 13.04%; new The price of pentylene glycol fell by 5,700 yuan/ton, a drop of 38%.
The price of acrylic acid in the emulsion industry chain fell by 5,400 yuan/ton, a drop of 45.38%; the price of butyl acrylate fell by 3,225 yuan/ton, a drop of 27.33%; the price of MMA fell by 1,500 yuan/ton, a drop of 12.55%.
In terms of pigments, the price of titanium dioxide fell by 4,833 yuan/ton, a drop of 23.31%; the price of TGIC additives fell by 22,000 yuan/ton, or a drop of 44%.
Compared with 2021, when the coatings industry increased revenue but did not increase profits, and raw material companies made a lot of money, the market situation in 2022 is beyond everyone’s imagination. Some people are fighting hard, some choose to lie flat, and some choose to quit… …No matter what choice you make, the market will not feel sorry for every person in charge of the company.
At present, it is mainly the downstream market that determines price fluctuations. At the beginning of the year, many industries shut down work and production, mid-year transportation closures made it difficult to purchase and sell, and at the end of the year, the “Golden September and Silver October” missed appointments. Many downstream industrial chains were on holiday for 100 days, shut down for half a year, closed down, and went bankrupt. Resins, emulsions, titanium dioxide, pigments and fillers, solvent aids and other products in the industrial chain faced a sharp drop in orders and had to cut prices to seize the market.
2. No more scenery? Many types of raw materials fell! Just take a vacation!
From the perspective of the entire chemical market, 2022 can be said to be just for survival. The surge in 2021 and the indifference in 2022 will be difficult to sustain without a few “heart-saving pills”!
According to Guanghua data monitoring, from January to November 15, 2022, among the 67 monitored chemicals, 38 have seen price cuts, accounting for 56.72%. Among them, as many as 13 kinds of chemicals have fallen by more than 30%, and there are many popular products such as acetic acid, sulfuric acid, epoxy resin, and bisphenol A.
Judging from the market situation, the entire chemical market is indeed relatively sluggish, which is inseparable from the global economic recession this year. Take BDO, which was a smash hit last year, for example. At present, BDO’s downstream spandex transfer adjustment cycle has been hit by both price and demand. The industry’s accumulation is obvious. In addition, domestic BDO’s production capacity under construction is as high as 20 million tons. The worry of “oversupply” spreads instantly. BDO has dropped 17,000 yuan/ton this year.
From the perspective of demand, OPEC lowered its global oil demand forecast again in November. It is expected that global oil demand will increase by 2.55 million barrels per day in 2022, which is 100,000 barrels per day lower than the previous forecast. This is the first OPEC since April this year. The oil demand forecast for 2022 has been lowered five times.
3. At present, the world is collectively falling into an “order shortage”
▶United States: The threat of a recession has grown as U.S. manufacturing posted its weakest growth since 2020 in October as orders fell and prices fell for the first time in more than two years.
▶South Korea: South Korea’s manufacturing purchasing managers’ index (PMI) fell to 47.6 in August from 49.8 in July after seasonal adjustment, below the 50 line for the second consecutive month and the lowest level since July 2020 . Among them, output and new orders showed the largest decline since June 2020, while new export orders showed the largest decline since July 2020.
▶United Kingdom: Affected by factors such as falling overseas demand, higher transportation costs, and longer delivery times, British manufacturing output fell for the third consecutive month, and orders fell for the fourth consecutive month.
▶Southeast Asia: European and American demand has decreased, and furniture orders in Southeast Asia have been canceled in large numbers. A survey of 52 enterprises conducted by an association in Vietnam showed that as many as 47 (accounting for 90.38%) member enterprises admitted that export orders in major markets have decreased, and only 5 enterprises have increased orders by 10% to 30%.
4. Difficult! Is the chemical city still saved?
With such a bad market, many chemical workers can’t help but wonder: When will they be able to rejuvenate again? Mainly depends on the following factors:
1) Is the Russia-Ukraine crisis likely to continue to worsen? As a major oil country, Russia’s next move is likely to completely change the energy landscape in Europe.
2) Is there a series of actions in the world to release economic stimulus plans such as infrastructure?
3) Are there any further optimization measures for domestic policies on the epidemic? Recently, the Ministry of Culture and Tourism has canceled the joint management of cross-provincial travel and risk areas. This is a positive sign. The rise and fall of the chemical industry is partly linked to economic booms or busts. When the general environment is improved, terminal demand can be released on a large scale.
4) Is there any further positive economic policy release for terminal demand?
5. The decline has narrowed due to the “stable price and stable market” of shutdown maintenance
In addition to BDO, PTA, polypropylene, ethylene glycol, polyester and other industrial chain enterprises announced shutdown for maintenance.
▶ Phenol ketone: The 480000 t/a phenol ketone unit of Changchun Chemical (Jiangsu) has been shut down for maintenance, and is expected to be restarted in the middle of November. Details are being followed up.
▶ Caprolactam: the caprolactam capacity of Shanxi Lubao is 100000 tons/year, and the caprolactam plant has been shut down for maintenance since November 10. Lanhua Kechuang has a capacity of 140000 tons of caprolactam, which will be stopped for maintenance from October 29, and the maintenance is planned to take about 40 days.
▶ Aniline: Shandong Haihua 50000 t/a aniline plant was shut down for maintenance, and the restart time is uncertain.
▶ Bisphenol A: Nantong Xingchen 150000 t/a bisphenol A plant is shut down for maintenance, and the maintenance is expected to last one week. The shutdown and maintenance of 150000 t/a bisphenol A plant of South Asia Plastics Industry (Ningbo) Co., Ltd. is expected to take 1 month.
▶ Cis polybutadiene rubber: Shengyu Chemical’s 80000 t/a nickel series cis polybutadiene rubber plant has two lines, and the first line will be shut down for maintenance from August 8. Shutdown and maintenance of Yantai Haopu Gaoshun polybutadiene rubber plant
▶ PTA: A 3.75 million ton PTA unit of Yisheng Dahua took off and landed at 50% on the afternoon of the 31st due to equipment problems, and the maintenance of a 350000 ton PTA unit in East China was postponed to the end of this week, with an expected short shutdown of 7 days.
▶ Polypropylene: 100000 ton unit of Zhongyuan Petrochemical, 450000 ton unit of luxury Xinjiang, 80000 ton unit of Lianhong Xinke, 160000 ton unit of Qinghai Salt Lake, 300000 ton unit of Tianjin Bohai Chemical, 90000 ton unit of Luoyang Petrochemical, 60000 ton unit of Tianjin Petrochemical, and 35000+350000 ton unit of Haiguo Longyou are currently in shutdown state.
According to incomplete statistics, the operating rate of chemical fiber, chemical industry, steel, tire and other industries has shown signs of significant decline, and large factories have stopped for maintenance or caused a decline in market inventory. Of course, it remains to be seen how effective the current shutdown maintenance will be.
Fortunately, with the release of 20 epidemic prevention policies, the dawn of the epidemic has appeared, and the decline in chemicals has narrowed. According to the statistics of Zhuochuang Information, 19 products rose on November 15, accounting for 17.27%; 60 products were stable, accounting for 54.55%; 31 products decreased, accounting for 28.18%.
Will the chemical market reverse and rise towards the end of the year?
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Post time: Dec-12-2022