Price trend in 2023:
| Melamine |
According to the Commodity Market Analysis System of Shengyishe, the average price of domestic melamine enterprises was 8233.33 yuan/ton on January 1, 2023. As of December 31, the average price of domestic melamine enterprises was 7475 yuan/ton, with a decrease of 9.21% in the year’s market.
In 2023, the melamine market first fell and then rose, with an overall downward trend.
In the first half of the year, there was strong cost support in January, with a large number of melamine maintenance devices and decent performance in the export market. However, domestic demand remained average before and after the Spring Festival, and the market remained stable and observed consolidation. In February, the melamine market fluctuated narrowly and rose, with raw material urea showing a “v” – shaped trend, which had a certain impact on the melamine market trend. Maintenance equipment gradually resumed, and downstream demand fell short of expectations. From March to June, the price of raw material urea fluctuated and fell, with weakened cost support and sufficient market supply. However, downstream demand was poor, and rigid demand followed suit. The melamine market continued to decline.
In the second half of the year, from July to August, the price of raw material urea increased, cost support increased, industry capacity utilization decreased, and spot supply was tight, supporting the rise of melamine prices. Downstream demand mainly followed suit. In mid to late September, downstream demand was weak, and new orders in the market were not well executed. Some enterprises resumed production, increased supply, and the mentality of operators was insufficient. Holders lowered prices to attract orders. In October, the market price of melamine remained stable with minor fluctuations, and holders followed the market to ship. In November, enterprise quotations first rose and then fell, with average cost support in the middle and late stages. The utilization rate of melamine production capacity was high, and domestic downstream demand was weak. The cost support in December is still acceptable, with a large number of parking devices, concentrated downstream hoarding, active entry into the market for purchasing, and strong price operation.
Market forecast for 2024:
Supply side:
In recent years, the production capacity growth rate of China’s melamine industry has slowed down compared to the previous period, with a slight increase in industry production capacity in 2023. The melamine market is sluggish in 2023, with limited profits and reduced production enthusiasm. Overall production in 2023 has slightly decreased compared to 2022, and it is expected that the melamine industry will continue to operate at a low level in 2024.
Demand side: Melamine has a wide demand side and is mainly used for boards, melamine powder, and impregnated paper. It can also be used in the production of coatings, resins, and flame retardant materials. It can also be used as anti folding and anti shrinkage treatment agents for textiles, synthetic fireproof layer bonding, fixing or hardening agents for waterproofing agents, etc. It is expected that downstream demand will remain relatively stable in 2024, with a focus on continuing to buy in demand.
Import and export: According to customs data, the total import volume of melamine in China in 2023 was 265928 kilograms, a year-on-year decrease of 29.34%. In 2023, the total export volume of melamine in China was 476452855 kilograms, a year-on-year decrease of 10.78%.
Cost side: Raw material urea: According to the commodity analysis system of Business Society, the mainstream market price of urea in Shandong Province has shown an overall downward trend in 2023. The starting price was 2698.00 yuan/ton, and the ending price was 2485.00 yuan/ton, with a year-on-year decline of 7.89%.
From the above figure, it can be seen that the price trend of melamine in 2023 is roughly similar to the trend of raw material urea. It is expected that the price changes in the melamine industry will still be greatly affected by the upstream urea industry in 2024.
Comprehensive prediction:
In summary, the changes in the supply and demand pattern of the melamine industry in 2024 may be relatively limited. It is expected that the melamine market will follow the trend of raw material urea prices in 2024, and more attention still needs to be paid to export demand, related policies, and other factors.
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