Propylene oxide prices continue to rise

Recently, the domestic epoxy propane market rose again, this week reversed the deadlock weak situation, returned to the upward trend, and has continued to strengthen the trend. The reason can be summarized as the negative drop of double section approaching + unexpected, and the influence is mainly manifested in PROPYLENE oxide and downstream key production and marketing areas of Jiangsu and Shandong province.

Jiangsu and Shandong provinces are the main production and marketing areas of propylene oxide and downstream industry in China. The production capacity of propylene oxide in Shandong and Jiangsu accounts for 42.86% and 11.4% respectively in China. The production capacity of polyether in Shandong, the main downstream force, accounts for about 44.7%, and that of Jiangsu accounts for about 17.52%. Other downstream propylene glycol, alcohol ether, isopropanolamine, Surfactant and Flame Retardants are also widely distributed in the two provinces.

The propylene oxide and downstream industries that have been greatly affected by the policy so far are alcohol ether and flame retardant industry:  Polyether factory on September 17, jiangsu long hua, zhong shan, ning forces are distributed around 20%, shandong also have certain requirements, part of the polyether device is not stable, but the overall impact is not big, affected by the security check, zhejiang province, some sponge enterprises continue to halt or negative, and export freight/insufficiency restrict exports, subsequent polyether conduction relatively limited demand;  The second downstream propylene glycol industry currently maintains a high profit level of over 8000 CNY/ton.

 After the restart of Shisheng Huadongying plant last weekend, the overall operation basically maintains normal high load;  Alcohol ether industry is affected by the policy, Jiangsu Baichuan and Dana plant temporarily shut down, the industry as a whole start load dropped to about 60%;  TCPP flame retardant industry although its own device has not been limited by the policy requirements, but due to the upstream product yellow phosphorus policy price skyrocketing, industry costs soaring, raw materials difficult to mining, the overall start of a significant decline, part of the factory parking.

Overall, short-term unexpected negative, upstream and downstream device made of epoxy propane and downstream industries from the mind the restimulation fluctuations, and to drive the upstream and downstream participants attention and trading activity, eventually guided on the surface of market supply and demand and price fluctuations, reversing a market stalemate, slightly open another agent.

Upstream industries throughout epoxy propane, propylene as raw materials for the main core of policy first in the northwest area, northwest of propylene supply in addition to the main supporting downstream, southwest main exile, normal operation for the supply of goods circulation, the downstream buying propylene can remain unobstructed, affected by the policy is not big, only affected by the enterprise power brownouts decline, Enthusiasm for purchasing raw materials is weakened.

In terms of liquid chlorine, epoxy propane and chlorohydrin enterprises are mostly concentrated in Shandong. In shandong market, some devices decreased successively under the influence of policies, the supply of commodities decreased, and the market transaction atmosphere was strong. The price increased broadly under the favorable support of the supply side, driving the overall upward trend in North China.

As of September 18, the mainstream of propylene in Shandong province is RMB 8,050 / ton, and the mainstream of liquid chlorine is RMB 1400-1600 / ton. Currently, the cost of propylene oxide by chlorol method is around RMB 10,900 / ton, and the profit fluctuates around RMB 5,700 / ton.