After the National Day holiday, the acrylonitrile market price fluctuated upwards due to strong cost push. As of October 9th, the mainstream negotiated price for tank self pickup in the East China market has remained firm at around 11000 yuan/ton, while the mainstream negotiated price for delivery in the Shandong market has gradually rebounded from the price reduction trend during the holiday period to around 10800 yuan/ton at present.
Loose supply:
During the week, Zhejiang Petrochemical increased its production capacity to 90%, and at the same time, Sinopec Tianjin’s 130000 tons/year plant was successfully put into operation and included in the total production capacity. The total domestic acrylonitrile production capacity base reached 5.709 million tons/year, and the overall supply significantly increased. According to statistics, this week (October 2-8), the capacity utilization rate of the domestic acrylonitrile industry reached 75.30%, an increase of 2.46% compared to the previous cycle; The weekly output is about 89900 tons, which is+0.49 million tons compared to the previous cycle. During the week, there was an increase in supply, and at the same time, partial shipments during the holidays were slow, leading to an increase in inventory for some companies. On October 8th, the total inventory of acrylonitrile factories in China was about 45000 tons, an increase of+45000 tons from last week.
Average demand:
This week, the capacity utilization rate of major downstream industries has seen limited improvement, with ABS capacity utilization rate at 55.2%, an increase of 0.1% compared to last week; The capacity utilization rate of acrylic fiber enterprises was 70.38%, unchanged from last week; The utilization rate of acrylamide production capacity was 55.4%, an increase of 0.74% compared to last week.
Cost increase:
After the holiday, the prices of propylene and synthetic ammonia, the main raw materials, have risen sharply. Therefore, although the price of acrylonitrile has shown a trend of following the rise, the increase is still less than that of raw materials, resulting in the current situation of single product production losses gradually worsening. According to statistics, as of October 8th, the mainstream closing price of Shandong propylene market was 9980-10170 yuan/ton, with an average price of 10075 yuan/ton; The average production cost of acrylonitrile is 12699 yuan/ton, with a month on month increase of 3.80%; The average profit of acrylonitrile production during the same period was -1598 yuan/ton, with a month on month decrease of -465 yuan/ton.
Post production forecast: Currently, there is ongoing pressure on the cost side, with suppliers continuing to raise prices and spot prices rising. The capacity utilization rate of the acrylonitrile industry remains at 73.7%. This market stage rebound is mainly driven by the cost side, and production enterprises are currently experiencing increased losses. There is a strong intention to raise prices. However, there is a lack of significant incremental expectations on the demand side in the short term, especially in the ABS industry, which continues to operate at low loads. The supply-demand relationship is still weak and will continue to suppress market rebound space. Attention should be paid to changes in the supply side.
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