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[Industry Focus]：Acrylonitrile production surge in the second half of the year, the price trend?

Read： 397 Time：2months ago Source：Business Club

1. Market Review

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in the first half of 2024, the acrylonitrile market experienced significant supply fluctuations and price adjustments. Since February, the market supply has gradually reduced, opening the upward price channel. Although the overall downstream demand growth failed to reach the expected level, the phased supply shortage still promoted the steady rise of acrylonitrile prices, especially in April. However, after entering May, with the continuous recovery of maintenance devices, the market supply pressure has been eased, and the price of acrylonitrile has also fallen from a high level. As of July 15, domestic acrylonitrile Market Price stable at 9100 yuan/ton.

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In the first half of the year, the total output of domestic acrylonitrile reached 1.689 million tons, an increase of 6.83 percent over the same period last year, indicating a steady growth in industry production. However, capacity utilization remained near 70.25 per cent, down slightly from the same period last year (0.03 per cent), indicating that there is still room for improvement.

Analysis and Forecast of Acrylonitrile Market in the Second Half of 2.

1. New capacity is planned to be launched and the supply increase is significant.

In the second half of the year, the acrylonitrile market will usher in a new round of capacity expansion. According to statistics, a total of four sets of domestic production capacity are planned to be increased, and 910000 tons of new production capacity is planned, mainly in the fourth quarter or the end of the year. Although some of the new capacity may be delayed, overall, the increase in supply will far exceed the level of the first half of the year. At the same time, the loss of planned maintenance equipment is expected to be 12-130000 tons, which is significantly lower than that in the first half of the year, further aggravating the expectation of supply increase.

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2. Downstream industry capacity expansion, demand continues to grow

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the downstream industry of acrylonitrile also showed a positive expansion trend in the second half of the year. Jilin chemical fiber, ABS industry and acrylamide industry have new projects put into production or expansion plan. Especially in the ABS industry, the expansion of Zhejiang Petrochemical's 1.2 million-ton project will significantly increase the demand for acrylonitrile. It is estimated that the actual consumption of domestic acrylonitrile products will reach 1.585 million tons in the second half of the year, up 11.2 percent from the previous year and 6.3 percent from the same period last year. For the whole year, the actual domestic consumption is estimated to reach 3.01 million tons, up 5.3 percent year-on-year.

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3. Price trend forecast: first up and then down, overall weak.

Comprehensive supply and demand factors, the price trend of acrylonitrile in the second half of the year is expected to show a trend of rising first and then falling, but the overall weak level in the first half of the year. At the beginning of the third quarter, affected by the overhaul of Jilin Petrochemical and other equipment and the production reduction plan of some enterprises, the market supply may be tense again, pushing the price to bottom out. However, with the gradual launch of new capacity and lower-than-expected growth in downstream demand, prices may face downward pressure in the fourth quarter. It is expected that the price of acrylonitrile in stock will remain at 9000-10000 yuan/ton.

In addition, the global economy is expected to further slow down and the resistance faced by acrylonitrile exports will also have a certain impact on market prices. Although the demand for acrylonitrile applications in many downstream areas continues to grow, the uncertainty of the global economic environment will still have a certain suppression effect on the market.

In summary, in the second half of 2024, the acrylonitrile market will face a situation where the increase in supply is greater than the increase in demand, and the price trend is expected to be short and the loss situation may exist for a long time. Industry participants need to pay close attention to market dynamics and changes in supply and demand, and flexibly adjust their business strategies to meet market challenges.

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