Chinese Acrylonitrile Profit Hit a Record High (2017)

Introduction

In 2017, the nominal capacity of Chinese Acrylonitrile was 1,947kt, which was equal to that of 2016. However, the profit of Chinese acrylonitrile hit a record high in recent years.

From May to July, 2017, the Chinese acrylonitrile price declined gradually because of the weak demand. However, from late July, a 80kt/a acrylonitrile unit in Sinopec Qilu Company and a 8kt/a acrylonitrile unit in Qitai Petrochemical were shut and the restart time was pending. Furthermore, from July to September, 2017, acrylonitrile units in PetroChina Jilin Company, PetroChina Fushun Company and Shanghai SECCO Petrochemical Company took overhaul, which caused the supply of acrylonitrile to be tight. At the same time, influenced by Hurricane Harvey in America, the acrylonitrile units in INEOS and Ascend were shut unexpectedly, which promoted the Chinese acrylonitrile price to increase. As a result, the Chinese acrylonitrile price ran on a high position in recent five years.

The Chinese acrylonitrile price increased rapidly, which provided producers a large profit. Up to November 30, 2017, the annual profit of Chinese acrylonitrile was RMB 2,439.67/mt, which was up RMB 2,137.87/mt. The profit made a new high from 2012.

From the supply side, up to November 30, 2017, the Chinese acrylonitrile capacity was 1,947kt. According to the figure above, the capacity stopped increasing from 2015. However, in the short term, Shandong Haili Chemical planned to increase capacity. In the long term, Keyuan Group and Sinopec Zhejiang Company are building new acrylonitrile units. So, the supply of acrylonitrile will increased clearly in the future. From the downstream demand side, it is predicted that ABS industry will increase almost 500kt capacity. The acrylic fibers industry will focus on structural adjustment. The capacity expansion in acrylamide and polyacrylamide industries will be limited.

In general, with the tight supply, the acrylonitrile price increased significantly in 2017. However, as the Chinese acrylonitrile capacity will expand, the supply-demand will tend to balance in the Chinese acrylonitrile market. It is predicted that the profit of Chinese acrylonitrile will be hard to run as high as that in 2017.