Global supply is tight, and export surge pushes up domestic acrylonitrile prices

Due to frequent failures of acrylonitrile devices in Europe and the United States, China's acrylonitrile exports surged from January to February 2021, tightening domestic spot supply, and the price of acrylonitrile hit a new high since 2020.

After the Spring Festival, the domestic market received a significant increase in export enquiries from abroad. However, before the holiday, most middlemen were short on the after-holiday market and actively sold on the market, resulting in extremely limited domestic spot supply after the holiday.

Boosted by this, domestic prices rose sharply after the holiday. According to ICIS data, the average outgoing price of Acrylonitrile in China's East China port rose from 12,000 CNY/ton on February 18 to 15,500 CNY/ton on March 3, an increase of 29.17%.

At the same time, since mid-February, the price of acrylonitrile on the external disk has accelerated, and the US FOB price has jumped. According to ICIS data, the US acrylonitrile FOB price rose to US$2,650/ton on February 25, and on February 11, the price was US$2050/ton, a two-week increase of US$600/ton.

Since the end of 2020, in addition to the planned shutdown and maintenance, two European installations of Taekwang and Ineos in South Korea, and the acrylonitrile installation of Cornerstone Chemicals in the United States have undergone unplanned maintenance or declared force majeure due to equipment failure and shortage of raw material PROPYLENE supply.

Global supply has tightened, and Acrylonitrile prices in Asia, Europe and the United States have been rising.

Due to the opening of the export arbitrage window, Chinese domestic suppliers are becoming more enthusiastic about exporting. China's acrylonitrile production capacity accounts for 33.18% of the world.

According to market news, it is conservatively estimated that the monthly domestic export volume during January-February 2021 will reach more than 10,000 tons, while the total annual export volume in 2020 will be only 73,000 tons.

Due to the export price advantage, some domestic suppliers will export all the balance beyond the domestic contract volume, and some traders also participate in spot exports. The export destinations are mostly South Korea, India and Turkey.

The extreme cold weather in the United States in mid-February caused several acrylonitrile plants in the United States to declare force majeure. As the main exporter of acrylonitrile in the United States, the production of Ineos and Ascend, the world's major acrylonitrile producers, has been severely affected, making the original tight supply of acrylonitrile in the world even worse.

At present, the cold wave in the United States has ended, and some acrylonitrile plants have been restarted one after another. However, due to the shortage of propylene supply, the operating rate may not increase substantially in the short term. In addition, an acrylonitrile unit of Ineos in Germany entered the planned maintenance in early March; the CSPC unit in the United States will also enter the planned maintenance in mid-March. The supply of acrylonitrile in Europe and America is tight or at least throughout the first quarter.

Due to the rapid increase in domestic acrylonitrile prices, downstream industries that are sensitive to raw material prices, such as acrylic fiber and amide, do not rule out reducing load or arranging parking, which is worthy of attention.