Author: Zhao Shuling Source: China Chemical Industry News October 15, 2019

The average price of acrylic acid in September was 2.26% lower than that in August and 18.98% lower than the same period last year. \"Golden Nine\" has already been broken. \"In the later period, with weak demand and sufficient supply, the acrylic market will continue to extend its weakness, and it is difficult to have bright spots, and the dream of \"Silver Ten\" is also difficult to achieve.\" \"Analyst Zhang Jindan of Jinlianchuang believes.

Sufficient market supply

Wang Ruiming, general manager of Shandong Ruiyang Chemical Trading Co., Ltd., said that the main reason for the poor performance of the acrylic acid market is the sufficient market supply.

It is understood that the first phase of Shandong Hengzheng 60,000 tons/year, Jiangsu Sanmu Taixing 160,000 tons/year, and Shanghai Huayi New Materials Co., Ltd. second phase 160,000 tons/year acrylic acid plant were put into operation this year. In addition, Shandong Nuoer Acrylic Acid and Arginic Acid Plant products are gradually released to the domestic bulk market.

Industry insiders said that after entering October, many overhaul devices will gradually resume production, acrylic acid production enterprises will maintain a medium to high level of operating rate, and supply of goods is still relatively sufficient.

Specifically, the CNOOC Huizhou acrylic acid ester plant and the Shanghai Huayi two-phase plant will continue to operate normally; the Qilukaitai old area acrylic plant is scheduled to resume construction in mid-October; the Shandong Hongxin plant that shut down at the end of September is also scheduled to resume in mid-October Construction started; Shenyang waxing plant was shut down for maintenance on September 5 and is expected to resume driving at the end of October.

From the point of view of profits of production enterprises, the cost pressure of the acrylic acid and ester industry is relatively large. Most enterprises hover below the cost line. Good companies can only earn 200 yuan per ton of products, while downstream acrylic companies lose about 1,000 yuan.

\"At present, although acrylic manufacturers have strong willingness to raise prices, the downstream profitability is not good, and the resistance is relatively strong, so the short-term market is facing great resistance.\" Zhang Dandan analysis said.

Inadequate cost support

Zhang Xu, manager of Jilin Baoyuan Chemical Trading Co., Ltd., said that in September, the propylene market's center of gravity was down. The average price of Shandong in mainstream regions was 7712.5 yuan, a decrease of about 2.8% compared with August. It is difficult to bring cost support to the acrylic acid market.

In mid-September, the propylene market rose rapidly due to the reduction in the volume of Northeast China's outflows, the purchase of downstream pre-holiday stocks, and the surge in crude oil and polypropylene futures. However, the enthusiasm of the downstream to enter the market is not good, and the propylene manufacturers are under the pressure of inventory to make profits. Towards the end of the month, due to the impact of the policy of limited production and line restrictions, downstream enterprises reduced the starting load, the demand for propylene was reduced, the production enterprises actively arranged their warehouses, and the price center of gravity fell rapidly. During the National Day, the domestic propylene market maintained stable operation, and the inventory of most refineries in Shandong supported low bids and stabilized the offer.

As for the market outlook, Zhang Dandan and other industry insiders believe that propylene production enterprises have opened and stopped each other, which has limited market support.

It is understood that Shandong Kenli Petrochemical shut down the catalytic device on October 9 and plans to overhaul it for one month; the Yatong device restarts in mid-October; the East China Xinpu device shuts down on October 5 and is expected to resume production on October 18; Donghua Fuji Petrochemical PDH and downstream PP pellet plant were shut down for maintenance for one month on October 5th; the maintenance and repair plan for the petrochemical plant in Guangzhou, South China.

However, more downstream equipment overhauls have weakened the upward momentum of the propylene market.

It is understood that Dongming Dongfang butanol plant will shut down during the National Day, and it is expected to stop for 2 to 3 weeks; Jilin Petrochemical butanol plant will be overhauled for one month from October 8th, and a set of 106,000 tons/year acrylonitrile plant will be available from October 9th Overhaul for about 20 days; Jiangsu Huachang Butanol Plant was shut down for maintenance on October 5.

On the whole, as downstream devices are shut down one after another, the demand for propylene will be reduced, and there is a risk of market prices falling, making it difficult to support acrylic acid on the cost side.

Needless support

He Junsong, a salesperson of Jilin Petrochemical, said that from the downstream perspective, due to the unfavorable factors such as Sino-US trade friction and economic downturn, the demand for acrylates and terminal industries continued to be sluggish.

According to He Junsong, affected by the escalation of Sino-US trade frictions, some import and export businesses of acrylic acid downstream and terminal industries were blocked, which was passed on to the consumption rate of raw materials such as acrylic acid and esters, which affected the market.

\"Golden Nine\" and the current performance of acrylic acid downstream market also confirmed this. Orders in industries such as emulsions, water reducers, resins and tape master rolls are not good. The downstream buyers are flat, and they mainly purchase acrylic acid and esters, which suppresses the market trading mentality.

Wang Chunming said that the tape master roll companies just needed stocks at the end of September, and they still need to purchase after the National Day; the overall demand for acrylic resins and esters in industries such as emulsion resins is difficult to have a large volume. In general, the downstream demand for acrylic acid remains low, and the \"silver ten\" market may fail.