June 22 news
According to the commodity market analysis system, from June 15 to 22, the BDO price in China fell from 7,933 CNY/ton to 7,850 CNY/ton, with a decline of 1.05% during the period, a month-on-month decrease of 6.59%, and a year-on-year decrease of 7.80%. Recently, there have been more plant maintenance and load reductions, increasing the supply-side benefits and supporting suppliers in stabilizing the market. However, due to weak terminal demand and poor cost transmission, downstream industries are mostly probing lower, negotiating raw material prices. The BDO market is seeing negotiations between supply and demand, leading to another decline in prices.
Supply Side: In terms of facilities, the second phase of Dongjing, Xinye, the first phase of Wuheng, and the second and fifth phases of Meike are undergoing maintenance shutdowns. Facilities in Inner Mongolia such as Sanwei, Huaheng, and Wanhua are operating at reduced loads, causing the industry's capacity utilization rate to drop below 50%, significantly reducing the supply of goods. The raw material prices are trending higher, exacerbating profit losses. However, premium transactions in online auctions are supporting suppliers' stable market sentiment. The BDO supply side is influenced by favorable factors.
Statistical Summary of Operating Conditions for Some Manufacturing Plants:
| Region | Plant Dynamics |
|---|---|
| Xinjiang Shuguang Lvhua | The 100,000-ton-per-year plant was shut down on June 9; the restart date is yet to be determined. |
| Xinjiang Meike | The Phase III plant has been shut down; Phases I and IV are operating steadily. Phases II and V will undergo maintenance starting June 15, with an initial estimate of one month. |
| Inner Mongolia Sanwei | The 300,000-ton-per-year BDO plant is operating at 80% capacity; there are plans for further load reductions in the future. |
| Shaanxi Heimao | The 60,000-ton-per-year plant is operating steadily. |
| Xinjiang Xinye | The 60,000+70,000-ton plant underwent a 20-day maintenance period starting June 9; the 70,000-ton plant was under maintenance from May 9 until the end of the major overhaul. |
| Inner Mongolia Dongjing Bio | Phase I is currently undergoing shutdown; Phase II will undergo maintenance starting June 10 for 50 days. |
| Ningxia Wuheng Chemical | Phase I plant will undergo maintenance for 15 days starting June 10; Phase II plant is scheduled for maintenance and catalyst replacement starting July 1, lasting 15 days. |
Cost Perspective: Regarding calcium carbide, Chinese calcium carbide prices have begun to rebound from their bottom. As the Dragon Boat Festival approaches, downstream demand for stockpiling has picked up, prompting companies to accelerate the unloading and storage of incoming shipments in order to ease transportation pressure. As a result, the market as a whole has entered a phase of destocking. On the methanol front, prices have plunged sharply. The easing of geopolitical tensions has boosted expectations for future imports, while weak spot market fundamentals have further driven prices down. Downstream buyers, influenced by a "buy on rise, not on fall" mentality, are adopting a cautious wait-and-see approach, leading to a sluggish trading atmosphere. With calcium carbide prices trending upward and methanol prices plunging, the cost impact on BDO is mixed—both positive and negative.
Demand Side: On the downstream side, terminal demand remains sluggish, and downstream industries are offering price concessions to facilitate sales, leading to frequent fluctuations and declines in market prices, thereby fueling bargaining sentiment regarding raw material prices. Moreover, under pressure from both supply and demand, many downstream industries have reduced their operating rates, resulting in a decline in the volume of raw materials being absorbed. As a result, BDO demand is being weighed down by predominantly bearish factors.
Market Forecast: Raw material calcium carbide continues to perform relatively strongly, while methanol remains in a low-level fluctuating range, easing cost pressures on BDO. Meanwhile, downstream industries such as PTMEG and PBT have seen a decline in operating rates, leading to reduced demand. Overall, BDO analysts expect the Chinese BDO market to remain largely stagnant after a recent price decline.
