Shanghai Petrochemical's polypropylene products get EU clearance

Recently, Shanghai Petrochemical Company has completed REACH registration of polypropylene (PP) products with the European Chemicals Agency.

According to the introduction, Shanghai Petrochemical has 3 sets of PP plants, which can produce PP homopolymer, random copolymer, impact copolymer and other products with a capacity of 400,000 tons/year.

In the next few years, PP production capacity will still be in the stage of rapid growth, and overcapacity will make the domestic PP market more competitive. In order to further open the international market, especially the EU market, Shanghai Petrochemical has started the REACH registration work since May 27th, and has gone through more than 70 days of commissioning samples, filing materials, registration and other procedures, and finally obtained the official registration documents.

Announcement of Shanghai Petrochemical's pre-loss performance

On July 14, Sinopec Shanghai Petrochemical Company Limited released the announcement of 2022 semi-annual results forecast loss: the net profit attributable to shareholders of the parent company for the first half of 2022 is expected to be RMB-464 million to RMB-324 million, excluding non-recurring gains and losses.

The reasons for the loss are: the price of crude oil increased significantly in the first half of 2022, the market of chemical products continued to be sluggish, the price of finished products increased less than the rate of increase of raw materials, and the company's gross profit decreased.

In the first half of 2022, Shanghai Petrochemical produced 222,300 tons of polypropylene and sold 207,200 tons, achieving sales revenue of about 1.7 billion yuan.

PP exports decline in the first quarter

According to the national customs data, the total export quantity of polypropylene in China in the first quarter of 2022 was 268,700 tons, a decrease of about 10.30% compared with the fourth quarter of last year and a decrease of about 21.62% compared with the first quarter of last year, a significant decline in export volume compared with the same period last year.

Total exports in the first quarter amounted to USD407 million, with an average export price of USD1,514.41/ton, down USD49.03/ton, with the main export price range remaining between USD1,000-1,600/ton.

The extreme cold and epidemic in the U.S. in the first quarter of last year led to a tightening of polypropylene supply in the U.S. and Europe and a demand gap overseas, resulting in relatively high exports.

Early this year, geopolitical factors combined with tight supply and demand for crude oil led to high oil prices, high costs for upstream companies, domestic polypropylene prices were dragged down by the weak domestic fundamentals, the export window continued to open, but due to the earlier release of overseas epidemic prevention and control, the manufacturing industry resumed a high start rate state, making China's first quarter exports fell severely year-on-year.