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[Industry Focus]：Epoxy propane market supply and demand game intensified, September price or weakening volatility

Read： 310 Time：2weeks ago Source：Zhuo Chuang Information

August supply and demand volatility led prices before high and after low

tight supply in early 1. pushes prices higher

in early August, the propylene oxide market ushered in a round of rising prices. A number of major manufacturers of equipment for centralized maintenance, resulting in a significant tightening of market supply. Binhua, Xinyue and other devices to reduce the negative operation, as well as Bohua, Qixiang Tengda, Huntsman and other devices parking, the combined effect of the market supply greatly reduced. Against this backdrop, suppliers actively pushed up offers and prices rose rapidly. However, as prices rose, market trading gradually weakened, some high-priced companies began to narrow profits, and the market atmosphere gradually turned pessimistic.

2. supply resumes in mid-month, prices under pressure to the downside

in the middle of the month, the overall supply of propylene oxide increased significantly with the resumption of production of units such as Bohua and the increase in the start-up load of some units. At the same time, the impact of low-cost sources of goods makes it difficult for suppliers to move goods,

propylene Oxide Price

the center of gravity began to oscillate downward. Shandong region low-end prices once refreshed the lows of the year, the market pessimism further spread. Although buying picked up slightly towards the end of the month, the price rally was insufficient and prices fell again at the end of the month.

3. months to start load down, supporting market prices

the overall start-up load of propylene oxide decreased in August, with an average start-up load of 63.53 per cent in the month, down 4.49 percentage points from the previous month. The parking and low load operation of many devices have played a supporting role in the market price. Despite the restart of Bohai, Ruiheng and other devices, but Qi Xiang, Huntsman and other devices parking maintenance, as well as the Binhua device continued to reduce the negative, so that the monthly output and start-up significantly decreased, helping to ease the supply pressure.

September supply and demand growth mismatch, prices or weakening volatility

significant incremental supply side of 1. and increased market pressure

in September, the propylene oxide supply side is expected to grow significantly. Although Wanhua Chemical Phase III plant will gradually reduce the negative, Zhejiang Petrochemical plant plans to stop maintenance, but Ruiheng plant after the resumption of negative, Huntsman, Qi Xiang and Tianjin three petrochemical plant plan to resume production, Lianyungang Shenghong plant is planned to put into production, Xinyue plant can also be negative. Propylene oxide production is expected to reach 450000 tons in September, an increase of 24600 tons, an increase of 5.78. The overall domestic in stock circulation increased and the pressure on enterprises to ship increased.

The demand side of 2. is not growing as fast as supply, and the contradiction between supply and demand is intensified.

Although the demand for propylene oxide is expected to grow in September, the increase in demand is less than the increase in supply. Although downstream industries such as polyether and dimethyl carbonate have new units put into production or resumed production, they are dragged down by end demand and the overall consumption cycle is extended. Although the demand for propylene oxide in polyether polyols has increased, the terminal follow-up is not smooth. On the whole, although the downstream demand has increased, the growth rate is limited, and the product profit is limited, and the price acceptance of propylene oxide is also limited.

3. raw material products have limited impact and the market is dominated by supply and demand

the price fluctuation of raw materials such as propylene and liquid chlorine is limited, which has little direct impact on the propylene oxide market. The propylene market is expected to have a small boost in costs and demand, but the price center of gravity changes are limited. The overall fluctuation of raw material products is limited, and the propylene oxide market is still dominated by supply and demand.

4. September epoxy propane prices or stalemate in the weakening of the shock.

Taking into account the changes at both ends of supply and demand, it is expected that the price of propylene oxide will weaken and fluctuate in the stalemate in September. The supply-side growth is significant, while the demand-side growth is less than expected, and the mismatch between supply and demand growth will exacerbate market tensions. The impact of raw material products is limited, or only moderately supported. It is estimated that the average price of propylene oxide in Shandong in September will be around 8550 yuan/ton, and the range will be maintained at 8400-8600 yuan/ton. Market participants need to pay close attention to changes in supply and demand and downstream industry dynamics, and flexibly adjust their strategies to cope with market fluctuations.

Source: Zhuo Chuang Information

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