Calcium carbide raw material was forced to stop production! The futures of polypropylene, plastics and PVC have soared by more than 5%!

Recently, Yulin City, Shaanxi Province issued the "Notice on Ensuring the Completion of the Energy Consumption Dual Control Target Task in 2021", with a maximum production limit of 60%!

The document stated that some key energy-consuming enterprises will be subject to regulation measures such as production restriction and production suspension, and the regulation time will last as long as 4 months! Among them, the newly built "two highs" projects must not be put into production; the newly built "two highs" projects that have been put into production will limit the production by 60%; the remaining "two highs" projects will reduce the production load and limit the production by 50%!

Yulin City inShaanxi requires local coal chemical companies to reduce their output by 50% in the fourth quarter.

The companies involved in the document include Yanchang China Coal Yulin Energy and Chemical and China Coal Yulin Energy and Chemical. The corresponding regulation measures are to reduce output by 50% and the power supply department to restrict power supply by 50%.

It is understood that the total annual production capacity of local coal-to-olefins is more than 3 million tons, of which the annual production capacity of PE is 1.5 million tons and the annual production capacity of PP is 1.6 million tons. After the production limit, the corresponding losses of PP and PE are shown in the figure below.

The Yulin area is also the PVC production area in Shaanxi, accounting for 5.97% of the country's total PVC production capacity. There are two companies in the Yulin area, Shaanxi Beiyuan and Shaanxi Jintai, both of which are affected by the dual control and limit their production to 50%. At present, the overall start-up of PVC in China is not high. Although the companies that have been overhauled in the early stage are gradually recovering, there are still some companies that are affected by the tight supply of raw materials, and it is difficult to start and upgrade.

The PVC enterprises in Yulin area are all Calcium Carbide enterprises, with a total production capacity of 3 million tons of calcium carbide, accounting for about 7% of the total production capacity of calcium carbide in the country. Among them, Beiyuan's supporting calcium carbide can only meet 30% of the demand for PVC production, and 70% of it still needs to be mined outside. In addition, most enterprises of calcium carbide raw material blue charcoal are "forced" to suspend production, coupled with the withdrawal of 50,000 tons of furnace models from the market, there is a certain gap in the supply of blue charcoal. If implemented in accordance with the document, the supply of blue charcoal will be even more tight, and the actual implementation of the company needs to be further observed.

At present, Shaanxi is affected by the National Games, with strict traffic control and certain restrictions on the transportation of hazardous chemicals, which has exacerbated the impact of calcium carbide arrivals in various regions. The price of raw calcium carbide continued to rise this week, continuing the trend of tight goods and high prices.

The prices of polyolefins, etc., were affected by this, soaring to the sky. Polypropylene, plastics, and PVC futures soared by more than 5%, styrene rose by more than 3%, and both polypropylene and polyethylene broke through March highs, setting new highs for the year.

Feng Bing, a senior researcher at Donghai Futures, said that the pressure on the upstream production of polyolefins remains unabated, and the downstream demand is not in the peak season. The price should have been weaker, but due to a document in Yulin area: "Double control of energy consumption", prices rose fiercely during the intraday session.

The supply shrinkage is obvious, and the market has adjusted the scope and time of the dual control of energy consumption. Coal chemical enterprises may expand their scope of production in the fourth quarter, the supply gap is obvious, and the price upward drive is strong. The LP spread is expected to weaken.

TITANIUM dioxide lifts the eighth round of increase, the industry chain is expected to welcome value revaluation.

Since September, a number of titanium dioxide companies have sent letters to increase the price, with the highest domestic increase of 1,000 CNY/ton and the international increase of up to 150 US dollars/ton, which kicked off the "golden nine silver ten" of the titanium dioxide industry. Now, during the peak season, many titanium dioxide companies such as Dongjia, Anadar, and Longbai Group have set off the eighth round of increase.

Since the beginning of the year, the rising trend of the chemical industry has never stopped, and titanium dioxide is undoubtedly the most dazzling "titanium dioxide" gold star, and it is rising almost every month. A-share titanium dioxide leader Longbai Group has ushered in the eighth round of price increases during the year, with a cumulative price increase of 7,000 CNY/ton. China Nuclear Titanium Dioxide increased 7 times during the year. According to domestic customers, except for the 500 CNY/ton price increase in January, the other six times all increased the price by 1,000 CNY/ton. The cumulative price increase this year has also reached 6,500 CNY/ton.

As of September 13, the average quotation of rutile titanium dioxide reached 20,700 CNY/ton, and some companies offered 21,000 CNY/ton, an increase of more than 50% from the beginning of this year.

According to industry insiders, rising costs are the dominant factor driving the increase in the price of titanium dioxide, and the prices of major raw materials such as titanium concentrate and Sulfuric Acid have increased significantly. Secondly, domestic market demand continues to improve, foreign markets are still affected by the epidemic, production capacity devices have not yet returned to normal, and product exports continue to increase.

Policies are also gaining momentum. Earlier, the Ministry of Industry and Information Technology responded to the CPPCC proposal that relevant departments are preparing the "14th Five-Year" national reserve development plan and will fully consider the proposal to include titanium dioxide in the national strategic resource reserve. In order to support the green and healthy development of the titanium dioxide industry, relevant state departments are actively constructing a titanium dioxide industry standard system. The relevant state departments actively promote the comprehensive utilization of titanium ore resources. In the next step, the Ministry of Science and Technology will set up a key special project of "strategic mineral resources development and utilization" to promote the development and application of high-value utilization technology of titanium ore resources.

At present, the market price of titanium dioxide is strong, domestic demand is good, and the downstream purchases on demand, and manufacturers are willing to increase prices. For the future price trend of titanium dioxide and the value of related listed companies, analysis agencies remain optimistic. Some titanium dioxide companies such as Longbai Group, China Nuclear Titanium Dioxide, Anada, etc. have begun to enter the new energy field, producing iron phosphate or lithium iron phosphate, realizing the coupling of the titanium industry chain and the new energy industry chain. Titanium dioxide companies are expected to use by-products Waste acid, ferrous sulfate, etc. are used as raw materials for the production of iron phosphate, which greatly reduces production costs. As titanium dioxide companies accelerate their deployment in the field of new energy cathode materials, the titanium dioxide industry chain is expected to usher in a value revaluation.