June 18th News
This week, the reduction in supply coupled with export demand has led to a tightening of local spot resources, and suppliers have generally raised their quotations, causing the acrylonitrile market to rise against the trend. As of June 18, the mainstream ex-tank self-pickup price at the East China port was 10,900-11,100 CNY/ton, up 700-800 CNY/ton from last week's 10,200-10,300 CNY/ton; the short-haul delivery price in the Shandong market was 10,850-10,950 CNY/ton, up 900-950 CNY/ton from last week's 9,900-10,050 CNY/ton.
Market Overview: Recently, as the international situation has eased, the prices of major energy and chemical products such as international crude oil and propylene have continued to fall. However, acrylonitrile stands out, with its price rising against the trend. This round of acrylonitrile price increases is mainly driven by positive fundamentals—reduced supply coupled with concentrated export deliveries, leading to tight spot resources. Especially in Shandong, spot resources are tight, and factory inventories are low. Under the condition of local tight spot resources, rigid buying demand follows, and suppliers' quotations generally rise, continuously pushing up market offers.
Supply side:
This week, there were no fluctuations in the facilities, with major plants maintaining low operating loads (Jilin Petrochemical at 80% load, Zhejiang Petrochemical at 60% load, Jiangsu Sailun at 50% load, Korol and Sinochem Quanzhou planning to resume operations next week). The overall capacity utilization rate of the acrylonitrile industry is currently below 70%. According to statistics, the weekly capacity utilization rate of acrylonitrile plants in China from June 12-18 was 66.67%, unchanged from the previous period; the weekly output was about 77,800 tons, also unchanged from the previous period. The supply volume remained at a low level during the week, while there was follow-up buying based on actual demand, leading to a significant decrease in inventory for some enterprises. As of June 17, the total inventory was approximately 40,000 tons, down by 6,000 tons from last week.
Demand side:
This week, the capacity utilization rates of major downstream industries in China varied. The capacity utilization rate for ABS was 58.1%, unchanged from last week; the capacity utilization rate for acrylonitrile enterprises was 83.54%, an increase of 9.54% from last week; and the capacity utilization rate for acrylamide was 52.62%, a decrease of 0.66% from last week. Overall, demand has increased.
Cost aspect:
During the week, while the price of acrylonitrile rose rapidly, the price of its main raw material, propylene, fell significantly, thus weakening the cost support. Currently, the theoretical production profit of acrylonitrile has turned from loss to profit. According to statistics, as of June 18, the market price of propylene in Shandong, China was 7,300 CNY/ton, a decrease of 1,550 CNY/ton from 8,850 CNY/ton last week. The average production cost of acrylonitrile was 10,396 CNY/ton, down 6.81% week-over-week, and the average production profit of acrylonitrile was 315 CNY/ton, up 1,220 CNY/ton week-over-week.
Later forecasts suggest that although raw material costs have decreased, the current changes in the fundamentals are driving the price trend. Inventories of companies remain low, and manufacturers still have the conditions to maintain prices. Moreover, there is still a steady demand for essential purchases. It is expected that the acrylonitrile market in China will remain firm in the short term. However, the restoration of theoretical production profits may lead to uncertainties in planned load reductions or shutdowns of facilities, potentially narrowing the room for further price increases.
