September 4th News
According to the commodity market analysis system, from August 1 to 31, the BDO price in China rose from 7,783 CNY/ton to 8,108 CNY/ton, with a price increase of 4.18% during the period and a year-on-year increase of 7.09%. In August, there were more maintenance and temporary shutdowns of BDO facilities in the Chinese market, leading to effective destocking in the industry and a continuous rise in the market.
Supply Side: In terms of facilities, although the Shuguang Lvhua plant restarted in August, planned maintenance was carried out on plants including Dongyuan, Tunhe, Yanchang Petroleum, Heima, and Yongying. Additionally, the second phase of Xinye and one set of Guotai's facilities unexpectedly shut down temporarily, leading to a significant reduction in monthly production. Furthermore, slower transportation in the Xinjiang region resulted in a decrease in both spot and contract volumes. These factors had a positive impact on the BDO supply side.
Statistical Summary of Operating Conditions for Some Manufacturing Plants:
| Region | Unit Status |
|---|---|
| Xinjiang Lanshan Tunhe | Phase I shut down on August 27, 2024. Phases II and III underwent a major inspection on July 31 and resumed operations on September 1, with load at 70-80%. |
| Xinjiang Meike | Phase III unit is shut down; Phases I, II, IV, and V units are operating steadily. |
| Inner Mongolia Sanwei | The 300,000-ton/year BDO unit is currently operating at around 70-80% capacity. |
| Xinjiang Guotai Xinhua | One unit is operating steadily; another unit was temporarily shut down due to boiler issues but has resumed stable operation after restarting on August 30. |
| Xinjiang Xinye | Phase I 60,000-ton unit and one Phase II 70,000-ton unit are operating steadily; one Phase II 70,000-ton unit is scheduled to restart in mid-September. |
| Ningxia Wuheng Chemical | Operating relatively steadily. |
| Sichuan Tianhua | Phase I 25,000-ton/year and Phase II 60,000-ton units are operating steadily. |
Cost aspect, the prices of raw materials such as calcium carbide and methanol are trending stronger, increasing the cost pressure on BDO. Suppliers have a positive attitude towards supporting the market, and the cost aspect is influenced by favorable factors for BDO.
Demand Side, in the downstream sector, overall production has increased, leading to higher consumption of raw materials. However, most products are in a loss-making state, making them resistant to high raw material prices. They are maintaining contract orders and engaging in small, high-priced spot transactions. The market's trading focus is fluctuating upwards. BDO demand is influenced by positive factors.
Market Outlook: The industry’s inventory destocking trend persists, and suppliers remain confident in maintaining current market conditions, continuing to support a higher market center. However, downstream costs remain under pressure, limiting buyers’ willingness to accept higher prices. Overall, BDO analysts expect the Chinese BDO market to primarily consolidate after recent price increases.
