Industry News
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PE plans to delay the production of new production capacity, easing expectations of increased supply in June
With the postponement of the production time of Sinopec's Ineos plant to the third and fourth quarters of the second half of the year, there has been no release of new polyethylene production capacity in China in the first half of 2024, which has not significantly increased the supply pressure in the first half of the year. The polyethylene market prices in the second quarter are relatively strong. According to statistics, China plans to add 3.45 million tons of new production capacity for the whole year of 2024, mainly concentrated in North China and Northwest China. The planned production time of new production capacity is often delayed to the third and fourth quarters, which reduces the supply pressure for the year and alleviates the expected increa... -
Where is polyolefin going to continue the profit cycle of plastic products?
According to data released by the National Bureau of Statistics, in April 2024, PPI (Producer Price Index) decreased by 2.5% year-on-year and 0.2% month on month; The purchasing prices of industrial producers decreased by 3.0% year-on-year and 0.3% month on month. On average, from January to April, PPI decreased by 2.7% compared to the same period last year, and industrial producer purchase prices decreased by 3.3%. Looking at the year-on-year changes in PPI in April, prices of means of production decreased by 3.1%, affecting the overall level of PPI by about 2.32 percentage points. Among them, the industrial prices of raw materials decreased by 1.9%, and the prices of processing industries decreased by 3.6%. In April, there was a year-on-year differentiation b... -
Rising sea freight combined with weak external demand hinders exports in April?
In April 2024, the export volume of domestic polypropylene showed a significant decline. According to customs statistics, the total export volume of polypropylene in China in April 2024 was 251800 tons, a decrease of 63700 tons compared to the previous month, a decrease of 20.19%, and a year-on-year increase of 133000 tons, an increase of 111.95%. According to the tax code (39021000), the export volume for this month was 226700 tons, a decrease of 62600 tons month on month and an increase of 123300 tons year-on-year; According to the tax code (39023010), the export volume for this month was 22500 tons, a decrease of 0600 tons month on month and an increase of 9100 tons year-on-year; According to the tax code (39023090), the export volume for this month was 2600... -
Weak stalemate in regenerated PE, high price transaction hindered
This week, the atmosphere in the recycled PE market was weak, and some high priced transactions of certain particles were hindered. In the traditional off-season of demand, downstream product factories have reduced their order volume, and due to their high finished product inventory, in the short term, downstream manufacturers mainly focus on digesting their own inventory, reducing their demand for raw materials and putting pressure on some high priced particles to sell. The production of recycling manufacturers has decreased, but the speed of delivery is slow, and the market's spot inventory is relatively high, which can still maintain rigid downstream demand. The supply of raw materials is still relatively low, making it difficult for prices to fall. It conti... -
ABS production will rebound after repeatedly hitting new lows
Since the concentrated release of production capacity in 2023, the competition pressure among ABS enterprises has increased, and the super lucrative profits have disappeared accordingly; Especially in the fourth quarter of 2023, ABS companies fell into a serious loss situation and did not improve until the first quarter of 2024. Long term losses have led to an increase in production cuts and shutdowns by ABS petrochemical manufacturers. Coupled with the addition of new production capacity, the production capacity base has increased. In April 2024, the operating rate of domestic ABS equipment has repeatedly hit a historic low. According to data monitoring by Jinlianchuang, in late April 2024, the daily operating level of ABS dropped to around 55%. In mi... -
Domestic competition pressure increases, PE import and export pattern gradually changes
In recent years, PE products have continued to move forward on the road of high-speed expansion. Although PE imports still account for a certain proportion, with the gradual increase of domestic production capacity, the localization rate of PE has shown a trend of increasing year by year. According to Jinlianchuang's statistics, as of 2023, the domestic PE production capacity has reached 30.91 million tons, with a production volume of around 27.3 million tons; It is expected that there will still be 3.45 million tons of production capacity put into operation in 2024, mostly concentrated in the second half of the year. It is expected that the PE production capacity will be 34.36 million tons and the output will be around 29 million tons in 2024. From 20... -
PE supply remains at a high level in the second quarter, reducing inventory pressure
In April, it is expected that China's PE supply (domestic+import+regeneration) will reach 3.76 million tons, a decrease of 11.43% compared to the previous month. On the domestic side, there has been a significant increase in domestic maintenance equipment, with a month on month decrease of 9.91% in domestic production. From a variety perspective, in April, except for Qilu, LDPE production has not yet resumed, and other production lines are basically operating normally. LDPE production and supply are expected to increase by 2 percentage points month on month. The price difference of HD-LL has fallen, but in April, LLDPE and HDPE maintenance were more concentrated, and the proportion of HDPE/LLDPE production decreased by 1 percentage point (month on month). From ... -
The decline in capacity utilization is difficult to alleviate supply pressure, and the PP industry will undergo transformation and upgrading
In recent years, the polypropylene industry has continued to expand its capacity, and its production base has also been growing accordingly; However, due to the slowdown in downstream demand growth and other factors, there is significant pressure on the supply side of polypropylene, and competition within the industry is evident. Domestic enterprises frequently reduce production and shutdown operations, resulting in a decrease in operating load and a decline in polypropylene production capacity utilization. It is expected that the utilization rate of polypropylene production capacity will break through a historic low by 2027, but it is still difficult to alleviate supply pressure. From 2014 to 2023, the domestic polypropylene production capacity has si... -
How will the future of the PP market change with favorable costs and supply
Recently, the positive cost side has supported the PP market price. Starting from the end of March (March 27th), international crude oil has shown a six consecutive upward trend due to the OPEC+organization's maintenance of production cuts and supply concerns caused by the geopolitical situation in the Middle East. As of April 5th, WTI closed at $86.91 per barrel and Brent closed at $91.17 per barrel, reaching a new high in 2024. Subsequently, due to the pressure of pullback and the easing of geopolitical situation, international crude oil prices fell. On Monday (April 8th), WTI fell by 0.48 US dollars per barrel to 86.43 US dollars per barrel, while Brent fell by 0.79 US dollars per barrel to 90.38 US dollars per barrel. The strong cost provides strong support... -
In March, the upstream inventory of PE fluctuated and there was limited inventory reduction in the intermediate links
In March, upstream petrochemical inventories continued to decrease, while coal enterprise inventories slightly accumulated at the beginning and end of the month, showing a mainly fluctuating decline overall. The upstream petrochemical inventory operated in the range of 335000 to 390000 tons within the month. In the first half of the month, the market lacked effective positive support, resulting in a stalemate in trading and a heavy wait-and-see situation for merchants. Downstream terminal factories were able to purchase and use according to order demand, while coal companies had a slight accumulation of inventory. The depletion of inventory for two types of oil was slow. In the second half of the month, influenced by the international situation, international c... -
Polypropylene production capacity has grown like mushrooms after rain, reaching 2.45 million tons in production in the second quarter!
According to statistics, in the first quarter of 2024, a total of 350000 tons of new production capacity were added, and two production enterprises, Guangdong Petrochemical Second Line and Huizhou Lituo, were put into operation; In another year, Zhongjing Petrochemical will expand its capacity by 150000 tons per year * 2, and as of now, the total production capacity of polypropylene in China is 40.29 million tons. From a regional perspective, the newly added facilities are located in the southern region, and among the expected production enterprises this year, the southern region remains the main production area. From the perspective of raw material sources, both externally sourced propylene and oil based sources are available. This year, the source of raw mate... -
Analysis of PP Import Volume from January to February 2024
From January to February 2024, the overall import volume of PP decreased, with a total import volume of 336700 tons in January, a decrease of 10.05% compared to the previous month and a decrease of 13.80% year-on-year. The import volume in February was 239100 tons, a month on month decrease of 28.99% and a year-on-year decrease of 39.08%. The cumulative import volume from January to February was 575800 tons, a decrease of 207300 tons or 26.47% compared to the same period last year. The import volume of homopolymer products in January was 215000 tons, a decrease of 21500 tons compared to the previous month, with a decrease of 9.09%. The import volume of block copolymer was 106000 tons, a decrease of 19300 tons compared to the ...