In the second half of July (7.15-7.29), the overall chemical market remained at a relatively high level, but the upward momentum dissipated, showing a slight correction trend. As of July 29, the chemical price index released by Chemical Online closed at 3485 points, a decrease of 1.0%. Among them, 52 products were rising, accounting for 32.5% of the total products; 84 products were falling, accounting for 52.5% of the total products; 24 products were stable, accounting for 15.0% of the total.
Product analysis of the increase list
Butadiene: Butadiene, which has been declining since the beginning of this year, ushered in a rebound in July. The increase in the second half of the month was even more pronounced. The price at the end of the month closed at 4800 yuan (ton price, the same below), with a half-month increase of 28.0%. The price of butadiene fell to a relatively low level in the early period, and there is a certain rebound in demand. In addition, the recent northern manufacturers have no pressure on shipments, the lack of imported goods in East China, and the tight market supply have also prompted major manufacturers to raise their quotations. However, the current market demand for terminal tires is general, which will curb the late growth of butadiene to a certain extent.
Dimethyl carbonate and PPG: In the second half of July, the propylene oxide downstream dimethyl carbonate and PPG rose significantly, with the half-month increase of 12.1% and 11.8% respectively. The raw material propylene oxide market has been in an upward channel since April, giving strong cost support to the downstream. In addition, some factories of PPG have been overhauled recently, and the export market has picked up, and dealers have sold their goods smoothly, leading to higher prices. Regarding dimethyl carbonate, due to the pre-market sluggishness, some installations, such as Yulin, Shaanxi and Dongneng, Chongqing, were shut down for maintenance. The supply contraction also boosted market confidence.
Pure benzene: The pure benzene market rebounded strongly in the second half of July, closing at 3450 yuan at the end of the month, an increase of 12.0%. During the statistical period, international crude oil rose slightly. WTI and Brent crude oil closed up 2.4% and 2.0% respectively, which strengthened the cost support for the pure benzene market. In addition, the continued increase in the price of pure benzene on the external disk has also pushed up the focus of domestic prices. However, the main port inventory of pure benzene is still at a high level, and the downstream demand has not seen a large amount, which is a drag on the market outlook.
Analysis of Declining Products
Acetone and isopropanol: The acetone market continued to fall in the second half of July, closing at 6,600 yuan at the end of the month, a decrease of 20.5%. The acetone market rose too sharply in the early stage, and a rational correction is still needed. From May to June, overseas orders for isopropanol, which drove its price increase, decreased, and the good news gradually dissipated. In addition, the high price of acetone has made other downstream manufacturers feel resistant, purchasing intentions are reduced, and demand is suppressed.
Hydrogen peroxide: In the second half of July, the hydrogen peroxide market dropped from a high level and closed at 920 yuan at the end of the month, a decrease of 8.9%. Recently, Shanxi Taihua's 240,000 tons/year hydrogen peroxide and other equipment restarted, Henan Pingdingshan Shenma's 270,000 tons/year new equipment has been in normal production, and the market supply has increased significantly. However, downstream demand remained rigid, and the shipment of hydrogen peroxide companies was slow, and prices continued to adjust.
Ethylene oxide: In the second half of July, the ethylene oxide market was weakly adjusted downwards, closing at 7,000 yuan at the end of the month, a decrease of 7.9%. Earlier prices rose, but downstream demand was weak, and the overall purchase of ethylene oxide decreased. Buyers mainly wait and see. Ethylene oxide manufacturers have increased inventory pressure, lowering their quotations to stimulate shipments. In the later stage, the demand for ethylene oxide will continue to be weak, and the market is expected to continue to decline in the short term.
Key product analysis
Aromatics: The aromatics market was mixed in the second half of July. Pure benzene and p-xylene rose 12.0% and 2.1%, respectively. Solvent grade xylene, isomeric grade xylene and toluene closed down 1.7%, 1.4% and 0.3%, respectively. International crude oil fluctuates mainly, and the cost support for the aromatics industry chain has increased slightly. PX manufacturers have reduced production due to losses, market supply has tightened, and prices have risen. Looking at the market outlook, the PX terminal textile industry market is light, and the planned maintenance of multiple PTA devices started in August, which will suppress the PX trend to a certain extent. In the xylene market, port inventories are high. In addition, the decline in downstream PX operations combined with the weakening of gasoline blending demand, oversupply makes the xylene market weak.
Plastic resin: The plastic resin market declined slightly in the second half of July. HDPE, LDPE and LLDPE closed down 3.5%, 3.4% and 2.3% respectively. The pre-maintenance equipment has been started up one after another, and the supply has increased, while the downstream demand is limited. In addition, the tension between China and the United States has led to increased market anxiety and market prices have fallen. The recent supply of PP imports is relatively abundant, low prices hit the market, the domestic market is under pressure, and the trend of futures is not good, the trend is relatively weak.
Polyester raw materials: The trend of polyester raw materials was opposite in the second half of July. The ethylene glycol market closed at 3630 yuan at the end of the month, an increase of 6.8%. Manufacturers suffered serious losses, the overall start-up was at a relatively low level, market supply was tightened, and crude oil prices rose slightly, and the ethylene glycol market was gradually rising. However, the downstream polyester has entered the off-season, and the inventory pressure is relatively high. In terms of PTA, Hengli’s 2.5 million tons/year new PTA plant has been operating normally, the operating rate has maintained a high level, the market supply has increased and the downstream polyester demand has been stable, and the price has dropped slightly.
In the second half of July, the chemical market was difficult to maintain a high level, prices fell slightly, and some products that had risen too sharply in the previous period were rationally adjusted, while the impact of international crude oil on the chemical market was relatively small. Recently, international crude oil is in a shock range. In the later stage, as the United States and Canada advance production recovery in an orderly manner, crude oil supply will increase. At the same time, concerns about the epidemic and international relations have led to poor crude oil demand expectations. Trend formation dragged down. On the demand side, some chemical products will enter the off-season in demand in August, which will restrain market trends. On the whole, it is expected that the chemical market may still fall slightly in the first half of August.
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