BASF's TDI price rises again, rising by more than 66% since the third quarter

In the afternoon of September 7, Shanghai BASF raised the September listing price of TDI by 4,000 CNY/ton to 22,000 CNY/ton (in barrels), a month-on-month increase of 6,000 CNY/ton from the August listing price.

Looking back at the third quarter of TDI, due to the frequent force majeure of overseas TDI production giants and the suspension of production and maintenance by large domestic manufacturers (August 31, European BASF TDI encountered force majeure. On September 1, Covestro North America’s TDI plant was short of raw materials And closed before the hurricane, declared force majeure.), coupled with the increase in downstream demand, TDI prices have increased significantly.

The domestic price of TDI has risen from 9,600 CNY/ton on June 30 to 16,025 CNY/ton on September 7, which has risen by more than 66% since the third quarter, and has recently been in an upward trend.

Leading domestic TDI companies are expected to benefit

Currently there are only 8 domestic TDI product manufacturers, namely Shanghai Covestro, Shanghai BASF, Wanhua Chemical, Juli Chemicals, Cangzhou Dahua, Gansu Yinguang (September 1st to 21st for maintenance), Wanhua Fujian , Liaoning Jinhua (the plant is in suspension). According to forecasts, China's TDI production capacity will be approximately 1.36 million tons in 2020.

As the leading domestic TDI companies, Wanhua Chemical and Cangzhou Dahua are expected to benefit from this round of price increases. Wanhua Chemical’s MDI and TDI capacity reached 2.1 million tons and 750,000 tons respectively (there is also a data showing that Wanhua Chemical’s TDI capacity is 550,000 tons/year), with huge performance flexibility; Cangzhou Dahua’s TDI capacity is 150,000 tons.

On August 22, Wanhua Chemical issued an announcement that the company’s Yantai Industrial Park’s TDI with an annual capacity of 300,000 tons has completed inspection and repair. "Last week Wanhua Chemical was closed down, and later the company's September listing price was increased by 2,000 yuan per ton to 19,000 CNY/ton." On September 7, a person close to Wanhua Chemical revealed. Cangzhou Dahua also stated on the investor interaction platform recently that the company's TDI device is operating smoothly and will adjust product prices according to market conditions.

In the near future, TDI prices may remain high and consolidate. The current low-price inventory in the market is insufficient, and exports rebounded and reached a new high this year last month. Suppliers are pulling up strongly, giving the market higher guidance prices, and the market mentality is positive, most of which continue to be bullish.

The TDI increase this month, the industry believes that supply contraction and better demand are the main driving force for this price increase. According to analysis, as TDI supply shrinkage is difficult to alleviate in the short term, TDI prices still have room for upside in the future.