Chemical Enterprises Collectively Stop Production! Supply 'Urgent'

Affected by the rise in international oil prices, No. 92 gasoline in some areas has exceeded the 9 yuan per liter mark for the first time. At 24:00 on June 14th, a new round of price adjustment window will be opened again. According to the current trend, refined oil products will usher in the tenth increase in the year next week, setting a new historical record again. A number of institutions predict that after the price adjustment, No. 95 gasoline in some areas may break the 10 yuan per liter mark, a record high. If the oil price is raised again this time, Hainan 92# gasoline may rise to about 10.4 yuan, and 95# gasoline may break the 11 yuan mark.

Some people make fun of today's oil prices, "When you fill up at 92, your legs are frightened. When you fill up at 95, your family goes bankrupt. When you fill up at 98, you will be repaid for three generations." Since the beginning of this year, domestic refined oil has undergone a total of ten price adjustments, showing a pattern of "nine ups and one down". After the ups and downs were balanced, the domestic gasoline and diesel prices increased by 2,330 yuan and 2,245 yuan per ton respectively.

Crisis is coming! The three major energy giants of coal, oil and natural gas have tight prices!

The continuous rise of domestic refined oil prices is inseparable from the driving factors of the recent international crude oil prices. Due to the tight global crude oil supply and demand and the influence of the geopolitical conflict between Russia and Ukraine, the price of crude oil exceeded $100 per barrel for the third time in history. Since the beginning of this year, international crude oil has risen by more than 60%, and has now exceeded $120 per barrel.

With the EU countries agreeing to ban the import of Russian oil in stages, the market expects that OPEC's small increase in production target will not be able to ease the tight global crude oil supply. The U.S. Strategic Petroleum Reserve fell to a historic low, while U.S. gasoline inventories unexpectedly fell. In other words, the current international crude oil is still showing an imbalance of supply in short supply.

In addition to oil, natural gas has also suffered a major setback recently, with an explosion in one of the largest liquefied natural gas (LNG) export terminals in the United States in recent days. The Texas-based LNG facility will be closed for at least three weeks and will lose about 940,000 tonnes of LNG exports, with the U.S. losing about one-fifth of its liquefaction capacity.

As one of the largest LNG processing and export facilities in the U.S., the Freeport Terminal receives about 2 billion cubic feet of natural gas per day, accounting for about 16% of the U.S. LNG export capacity. Export. Customers of the free port include BP and Total Energy in Europe, Tokyo Electric Power, Osaka Gas in Japan and SKE&S in South Korea. Freeport export terminals have traditionally shipped most of their cargo to Japan and South Korea, but the shutdown will affect Europe, putting further pressure on already tight global gas supplies.

The explosion came as global demand for natural gas was soaring and the fires could have an impact on global fuel supplies, sending natural gas futures higher. U.K. natural gas futures for July delivery surged about 22% on the day, while the Dutch TTF benchmark gas rose about 7%. British natural gas futures front-month contracts jumped 32% from their previous close to 171.5p/them.

Under the influence of external influence, oil and natural gas continue to show an imbalance in supply and demand, and another important energy source, coal, is not immune to it. Overseas coal prices have risen sharply. Australia's Newcastle thermal coal recently reached a record high of US$436.10/ton, and the Indonesian coal benchmark price (HBA) reached a new high of US$323.91/ton in June.

At the same time, the coal mines in Yulin area maintained a hot sales situation. Most of the mines were producing and selling at the same time, with low inventory and queuing. Coal phenomena such as queuing were common. In some mining areas, there were many vehicles queuing up, causing serious road congestion. Large state-owned mines in the Ordos region are still dominated by supply and long-term associations, and small and medium-sized coal mines are also hard to find, and queues for coal are common. In addition, it is currently in the stage of safety production month, and many places have carried out safety production month activities. The output of coal mines has decreased, and large state-owned mines continue to guarantee supply and long-term cooperation. Overall, the supply of coal mines has become tighter.

Whether it is crude oil, natural gas, or coal, they are all important global primary non-renewable resources. Therefore, whether it is a shortage of supply or a high price, it will have an impact on the economic development of countries around the world, and will also bring irreversible effects on secondary energy such as electricity. The neglected "butterfly effect". The beginning of summer, the impact of the epidemic, the conflict between Russia and Ukraine and the sanctions imposed by Western countries on Russia have caused the world to face a triple crisis of oil, gas and electricity at the same time. Experts say the energy crisis is much worse than the oil crises of the 1970s and 1980s and is likely to last longer.

Force majeure + shutdown for maintenance, the large chemical plant lies flat, and the production capacity of 4 million tons is "zeroed"

In addition, the "Big Three" are also important raw materials for the chemical industry, and there are many chemical raw materials in their respective industrial chains and derivative industrial chains. The terminals are also related to automobiles, real estate, construction and other industries that are closely related to people's clothing, food, housing and transportation. field. There is no doubt that the shortage of supply and high prices at the source end will have an impact on the chemical industry chain. What is more serious is that at present, the middle and lower reaches of the chemical industry are facing a severe situation of "flattening" upstream raw materials.

Recently, Dow's 340,000-ton/year MDI plant in Freeport, USA, declared force majeure due to the supply of front-end raw material plant. In addition, there is still another MDI factory in North America under force majeure.

Americas Styrenics (AmSty), a major North American polystyrene producer, said it expects to reduce orders and limit availability through June due to unexpected operational issues at its St. James, Louisiana, styrene monomer plant on April 27, which It also led AmSty to declare force majeure on deliveries of its raw materials, styrene and ethylbenzene.

TotalEnergie said it declared force majeure on North American PP products due to a shortage of additives needed to produce some grades.

ExxonMobil (ExxonMobil) said that due to current operational constraints, it will begin to allocate sales of specific PP grades, and the timing and quality of products for this allocation measure are still being determined.

Affected by the interruption of the supply of raw materials, Celanese and INEOS announced that the acetic acid plant was shut down due to force majeure, and the acetic acid plant in Lid Ambase Texas shut down due to a mechanical failure of the carbon monoxide supply system.

In addition, the "Cargo Joint Headquarters" of the South Korean Freight Union has launched a general strike on the 7th, hindering the production and logistics of chemical industrial parks in Yeosu, Ulsan and other places. At present, 50 bases in 16 regions across South Korea are undergoing general strikes, including steel, cement, petrochemicals (Ulsan, Daesan, Yeosu, etc.), automobiles, and containers. Over 80-90%, some Southeast Asian buyers expect their imports of PE and PP from Korea to be delayed by 1-2 weeks. Since the 7th, more than 600 employees have been on strike in front of petrochemical plants such as GS Caltex and LG Chem. On the 8th, 21 people were arrested in Yeosu Industrial Park, including Hite Jinro Icheon Plant and Hanwha Total Petrochemical Plant.

The strike directly led to a 33% reduction in the operation of Hanwha's TDI plant in Yeosu, and a 60% reduction in BASF's TDI and MDI plants in Yeosu.

In addition to the "passive lying flat" brought about by "force majeure", many domestic enterprises choose to stop for maintenance due to accidents, production plans and other reasons, which can be called "active lying flat".

The leakage of a spherical tank pump in the chemical division of Maoming Petrochemical resulted in a fire in the intermediate tank of the aromatics unit of the ethylene cracker. The fault involves the 2# cracking unit. At present, the 250,000-ton/year 2# LDPE unit has been shut down and the start-up time is to be determined.

Since the second quarter, acetic acid enterprises have started centralized maintenance. At present, Nanjing Celanese (1.2 million tons), Shandong Yankuang (1 million tons), and Shaanxi Yanchang (400,000 tons) have been shut down for maintenance, and the industry operating rate has further increased.

At 0:00 on May 25, Lunan Chemical started to stop the production units one after another, and the 30-day system maintenance in 2022 officially kicked off.

Shanghai Xisa's 480,000-ton/year phenol and ketone plant is scheduled to be shut down for maintenance for ten days from June 10 to 20.

A 100,000-ton polyester staple fiber plant in Henan Luohua was shut down for maintenance on June 6, and the restart time is to be determined.

One set of Wanhua Fujian TDI plant (50,000 tons) was shut down, and the other set (50,000 tons) was shut down for maintenance on June 1 for about 3 weeks.

The 100,000-ton hydrocyclohexanone plant of Fengfan New Materials (formerly Hebei Shijiao Chemical Industry) has been overhauled, and the restart time is temporarily uncertain.

The 50,000-ton hydration process cyclohexanone plant of Chongqing Huafeng Chemical Co., Ltd. was shut down.

Xinjiang Cathay Pacific's 200,000-ton BDO plant was shut down for maintenance on May 15, and is expected to be within one month.

Alang Taiwan Rubber's 30,000 tons/year nitrile rubber plant was shut down for maintenance on June 8, and the maintenance is expected to take about 20 days.

Luoyang Petrochemical's PTA unit with an annual production capacity of 325,000 tons was shut down for maintenance at the end of May and is scheduled to be restarted in late June.

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According to incomplete statistics, more than 4 million tons of chemical production capacity is currently idle, which is comparable to "zeroing", and the operating rate of chemical subdivisions is generally not high. Coupled with the force majeure of many overseas chemical factories, delayed delivery, and slow import and export trade transportation caused by the epidemic, the mid- and downstream enterprises in the chemical industry will experience shortages of undetermined supplies or even "stock out". Before construction, home furnishing, decoration, automobile and other industries recover slowly and the operating rate has not recovered, whether the upstream "out of stock" will drive up the price of chemical products, or it will depend on the supply and demand game in multiple links in the entire industrial chain. the result of.