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The collective price increase of chemicals such as epichlorohydrin and resin!

ECHEMI 2021-09-16

Recently, the price of organic silicon, an important raw material in the photovoltaic industry chain, has continued to rise. At present, the price of organic silicon is 41,000 yuan/ton, which has risen by nearly 1,000 yuan/ton within the month, and it has risen by more than 80% during the year. More companies have quoted a “sky price” of 43,000 yuan/ton. Except for a few companies tentatively reporting high prices, many factories have closed their orders without reporting, and the suspension of orders and sales restrictions are very common.

Since the beginning of the year, the silicone market has continued to rise, which is inseparable from the popular pull of the downstream photovoltaic industry. The reason that really pushed organic silicon products to hit the 40,000 yuan/ton mark was the dual-control document on energy consumption recently released in Yunnan.

Yunnan's industrial silicon production is reduced by 90%, the national production capacity is reduced by about 15%, and the major silicone manufacturers are closed without reporting

Recently, the Yunnan Development and Reform Commission issued a red-headed document "Notice of the Office of the Leading Group for Energy Conservation of Yunnan Province on Resolutely Doing a Good Job in Energy Consumption Dual Control", which requires that the average monthly output of industrial silicon companies from September to December is not higher than 10% of the August output. (I.e. cut production by 90%).

The national production capacity of industrial silicon is about 5.095 million tons/year, of which Yunnan's industrial silicon production capacity is 1.139 million tons/year (22%), ranking second in the country. If the production is further reduced by 90% on the basis of August, the national yellow phosphorus production capacity will be reduced by about 15%. It is not difficult to calculate that the monthly output under the intensity of a 90% reduction will be less than 6,500 tons, which is far below the level of more than 20,000 tons/month during the dry season at the beginning of the year.

In addition to Yunnan, Xinjiang, Sichuan, Fujian, Guizhou, etc. are also areas where energy consumption did not meet the standards and were “named” and the situation is more severe. There will be action. As of the first half of next year, the new production capacity of organic silicon and polysilicon companies will be put into production one after another, which is expected to drive new demand for industrial silicon by 300,000 to 400,000 tons per year, an annual growth rate of 10%. Energy consumption control continues throughout the year, and the annual supply and demand gap may reach 28%. 

The tight supply of industrial silicon has undoubtedly promoted the tighter prices of downstream silicone products. At present, some companies are quoting 41,000 yuan/ton for silicone, and many major manufacturers have announced that they will not offer prices. It is expected that there will still be bullish expectations in the future.

Inner Mongolia Hengye has an annual production capacity of 240,000 tons of monomers, and silicones are temporarily not quoting.

Tangshan Sanyou Chemical Plant has an annual production capacity of 200,000 tons, and organic silicon is temporarily not quoted.

Zhejiang Xin'an has a total monomer production capacity of 490,000 tons, and silicones will not be offered for the time being.

Zhejiang Zhongtian has a monomer production capacity of 120,000 tons, and organic silicon is temporarily not quoted.

Hubei Xingfa has an annual production capacity of 320,000 tons of monomers, and silicones are temporarily not quoting.

Shandong Jinling Chemical has a monomer production capacity of 150,000 tons, and organic silicon is temporarily not quotation.

Hesheng Silicon has a total monomer production capacity of 930,000 tons, and organic silicon is not currently quoting.

Yunnan's yellow phosphorus production is reduced by 90%, and the national production capacity is reduced by about 30%, and the phosphorus chemical industry chain is going to the sky

In accordance with the requirements for dual control of energy consumption in Yunnan, the average monthly output of yellow phosphorus production lines from September to December should not exceed 10% of the output in August 2021 (ie a 90% reduction in output). In previous years, Yunnan’s yellow phosphorus production capacity was generally 40% of the national production capacity. %, if the production is further reduced by 90% on the basis of August, the national yellow phosphorus production capacity may be further reduced by about 30%.

From the perspective of supply, Yunnan, Guizhou, and Sichuan are the main yellow phosphorus production areas in my country. In addition to the Yunnan area clearly stipulating the reduction of production, the operating rate of yellow phosphorus enterprises in Sichuan is low due to environmental protection supervision, and the power rationing in Guizhou has caused some yellow phosphorus enterprises to stop. Production is restricted, and the domestic supply of yellow phosphorus continues to decrease, and prices are expected to continue to rise.

The current average price of yellow phosphorus is 44,000 yuan/ton, up by 53% within the month and up by 172% from the beginning of the year. Yellow phosphorous manufacturers mainly place pre-orders, and the spot supply is tight. Orders are scheduled to October, and some manufacturers temporarily stop quoting.

Affected by the skyrocketing price of yellow phosphorus, the entire phosphorus chemical industry chain has been affected. The cost of phosphoric acid products has risen and prices have generally risen. The current price is 9,400 yuan/ton, and the price has risen by more than 20% within the week. Sichuan Anda Nongsen Technology started at a low level, and 85% industrial phosphoric acid was quoted at RMB 12,000/ton from the factory; Nantong Beige 85% industrial phosphoric acid was quoted at RMB 13,700/ton. The quotations of monoammonium phosphate and diammonium phosphate were 3345 yuan/ton and 3264 yuan/ton, respectively, up 63.73% and 38.89% from the beginning of the year.

The cost of downstream lithium iron phosphate and lithium hexafluorophosphate continues to rise under pressure. At present, the mainstream quotation of lithium iron phosphate power type is in the range of 6-62,000 yuan/ton, which is 62% higher than the quotation at the beginning of the year. The quotation of energy storage lithium iron phosphate ranges from 55,000 to 60,000 yuan/ton, and the market price is moving upwards and tends to be strong in the short term. The price of lithium hexafluorophosphate has been as high as 450,000 yuan/ton, a jump of 20,000 yuan/ton in a single day. Compared with the price of about 70,000 yuan/ton in September last year, the annual increase is more than 500%. The overall sales of downstream new energy vehicles are increasing. In the future, the supply of lithium hexafluorophosphate and lithium iron phosphate will continue to be tight, and prices are expected to reach new highs.

The operating rate of soda ash in Jiangsu dropped by 20%, and soda ash rose 10 times, reaching a high in nearly 10 years

Jiangsu has launched a special energy-saving supervision action for enterprises with a comprehensive energy consumption of more than 50,000 tons in 2021. Affected by this, some soda ash enterprises in Jiangsu have plans to reduce production in September, and the operating rate may drop by 20%.

At present, the domestic price of light soda ash is 2,411 yuan/ton, and the price of heavy soda ash is 2,656 yuan/ton. Both have increased by more than 80% this year. The spot price of soda ash has been raised more than 10 times since the beginning of the year, and has now risen to a high level in the past 10 years. At present, the downstream photovoltaic glass demand of soda ash is strong, the new capacity is insufficient, and the backward production capacity continues to be eliminated. It is expected that the industry supply will continue to be tight.

In addition to the glass field, soda ash is also widely used in the extraction and preparation of lithium carbonate. The price increase of soda ash has also promoted the price of lithium carbonate. The current price of lithium carbonate is 143,500 yuan/ton, and it is sprinting towards 200,000 yuan/ton. Since the beginning of this year, the domestic new energy market has been booming, and the price of lithium carbonate has started a new round of rise, which has risen by 170% year-to-date. With the continuous increase in the penetration rate of new energy vehicles, the upstream demand for lithium carbonate will continue to grow at a high speed, driving the demand for soda ash to rise.

Major factories stop production, epichlorohydrin rises by 60%, TGIC is closed, resin industry burns eyebrows

The market heard that the epichlorohydrin company Jiangsu Haixing was suspected of being suspended due to carbon emissions, which led to a sharp drop in market supply. Later, due to carbon emission inspections, the operating rate of the epichlorohydrin industry was low, and the tight supply situation further intensified. At present, the domestic price of epichlorohydrin is 19,750 yuan/ton, and the quotation of some companies is 20,000 yuan/ton, an increase of 60% from the beginning of the year. Affected by this, the price of TGIC curing agent soared to more than 58 yuan/kg, a 35% increase from the low point during the year. Individual companies quoted 61 yuan/kg, and many companies closed their sales.

In addition, Jiangsu, a major city of liquid epoxy resins, received a first-level warning, and Anhui, a major city of solid epoxy resins, received a second-level warning. Local chemical companies may have limited power and production restrictions, and epoxy resin industry chain products may see tight prices. 

Inner Mongolia restricts new production capacity, Calcium Carbide and PVC prices rise

The Inner Mongolia Development and Reform Commission issued the "Several Safeguard Measures for Ensuring the Completion of the Energy Consumption Dual Control Targets and Tasks in the 14th Five-Year Plan". Starting from 2021, coke (blue charcoal), calcium carbide, polyvinyl chloride (PVC), and synthetic ammonia (urea) will no longer be approved. ), methanol, ethylene glycol, Caustic Soda, soda ash, ammonium phosphate, yellow phosphorus... new capacity projects such as polysilicon and monocrystalline silicon without downstream conversion.

Inner Mongolia is my country's largest calcium carbide production base, with a production capacity accounting for approximately 35% and an output accounting for approximately 40%. Inner Mongolia, Xinjiang, and Ningxia together account for 71% of the production capacity of calcium carbide. Inner Mongolia first proposed a strict dual-control policy for energy consumption this year, and subsequent Ningxia, Xinjiang and other places are expected to introduce related policies. Calcium carbide has also become the most affected chemical product since this year's dual-carbon strategy.

At present, calcium carbide companies in Inner Mongolia are still curtailing electricity, and the price of calcium carbide has risen to 5,720 yuan/ton, a record high, up 42% from the beginning of the year. The downstream of calcium carbide is mainly PVC, which accounts for 89% of the demand. On the one hand, the price of PVC is also rising due to the increase in the price of calcium carbide. On the other hand, the PVC production process is inherently high in energy consumption and pollution. The northwestern region of its main production area is also an area where energy consumption is not up to standard. The start of the enterprise is affected and the supply continues to decrease. It is expected that the loss in September will reach 180,000 tons. The current price of PVC is 10,023 yuan/ton, up nearly 40% year-to-date, and it is expected that PVC prices will remain high in the future.

Now is the critical moment of the “tough battle” for dual energy consumption control. In addition to Yunnan and Inner Mongolia, which have already resorted to the “big move”, it is expected that more regions will publish documents restricting and adopting measures to restrict energy-intensive industries and enterprises in the region. Achieve a reduction in energy consumption intensity. Not only is the new capacity limited, but the current capacity has also been "cut off" by most of the measures such as power curtailment and production restriction. At the end of the year, under the situation of stricter environmental inspection and energy consumption control, the supply of goods is even more in short supply, more and more chemicals will start the charge war, and the price increase will intensify.

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