In the Second Quarter, the Supply of Bisphenol A Gradually Increased, and the Price and Gross Profit Contracted Simultaneously

In the second quarter of 2022, the overall decline of bisphenol A was obvious. Due to the superposition of geopolitical and epidemic emergencies, the upstream and downstream of bisphenol A were significantly differentiated. The domestic supply of bisphenol A has gradually increased, while the recovery of downstream terminal consumption has been slow. As a result, the prices of epoxy resin and PC in the two downstream industries have repeatedly dropped. The market is mainly just in demand, and the contradiction between supply and demand is slightly prominent, resulting in a decline in the market price of bisphenol A in the second quarter. , the industry profits shrink sharply.

1. The price of bisphenol A fluctuated downwards

The price of bisphenol A fell further in the second quarter, especially in the middle and late June, showing an accelerated downward trend. From April to mid-May 2022, the spot of bisphenol A fluctuated in a narrow range of 16,500-16,900 CNY/ton. Since March, the domestic epidemic broke out at multiple points, the market supply chain was blocked, logistics prices rose sharply, and the superimposed exchange rate fluctuations caused import demand to be affected. The supply and demand side of bisphenol A have been impacted to varying degrees. During the period, the geopolitical outbreak of Russia and Ukraine pushed energy prices into an upward fast lane, and the cost of bisphenol A was supported. Under the hedge of multiple factors, the fluctuation space of bisphenol A was limited. However, since late May, despite the strong upstream cost, the downstream terminal demand has not recovered as expected after the epidemic, the contradiction between the supply and demand of epoxy resin and PC has become prominent, and the market price has been continuously bottomed out, which has continuously squeezed the bisphenol A market, especially After mid-June, with the accelerated decline of the two downstreams, bisphenol A has repeatedly fallen below the key resistance level. As of June 22, the closing price of the mainstream market in East China was 14,100 CNY/ton, and the market intention price fell below 14,000 CNY/ton. The average price in the second quarter (April 1-June 22) was 16,006 CNY/ton, down about 11% month-on-month and down about 37% year-on-year. In the second quarter, the price difference between the high and low points of bisphenol A was about 2,500 CNY/ton.

2. Gross profit of bisphenol A industry shrinks sharply

In the second quarter, affected by geopolitical factors, international crude oil rose sharply, and pure benzene rose sharply due to the impact of cost and supply and demand, resulting in a significant increase in the cost of bisphenol A. With the downward adjustment of the price of bisphenol A, the gross profit of the bisphenol A industry further shrinks. According to the monitoring data of Longzhong Information, the average prices of phenol and acetone rose by 11.75% and 14.02% respectively from April 1st to June 22nd, while the price of bisphenol A fell by about 16.32% during the same period, which is evident from the shrinkage of the gross profit of bisphenol A.

As of June 22, 2022, the gross profit of the bisphenol A industry has been compressed to around 1,430 CNY/ton. The average gross profit of the industry in the second quarter was about 3,512 CNY/ton, down 26% month-on-month and down about 74% year-on-year.

3. The domestic supply of bisphenol A is steadily increasing

In the second quarter of 2022, the load of bisphenol A domestic installations did not fluctuate much, and some installations were temporarily shut down for maintenance, which had a limited impact on the market supply, and the overall supply was steadily increasing. In the second quarter, the domestic production of bisphenol A was about 570,000 tons, an increase of about 3.6% month-on-month and a year-on-year increase of about 29%. In the second quarter, the capacity utilization rate of domestic bisphenol A plants was about 75.68%, basically the same as the previous quarter.

In late June, the upstream and downstream resonance of bisphenol A had a significant impact, especially with the two downstream markets. At present, bisphenol A, epoxy resin, and PC have all hit record lows since January 2021. However, in terms of current market conditions, the terminal consumption of PC and epoxy resin is sluggish, and the destocking of the market continues, while the supply of bisphenol A is temporarily stable. , the lack of upstream and downstream benefits, the lack of confidence in the market buyers and sellers, it is expected that the bisphenol A market cycle adjustment trend is still in the near future.