Nearly 100 chemical giants "United" ceased production! The price hike may continue for another 3-6 months!
It is understood that nearly a hundred chemical companies are currently shutting down for maintenance or planning to conduct shutdown maintenance this year, involving many chemicals such as bisphenol A, PC, PP, PE, and PVC industrial chain.
Some of these companies are part of the equipment overhaul, and some are completely shut down for overhaul, and the cycle is generally long, basically between 10-50 days. Some companies directly announced that they will close their supply! There is not much remaining inventory, so be ready to stock up!
The specific overhaul conditions are as follows:
▶▶▶Overhauled by a large polyethylene PE factory for up to 45 days!
In March, domestic PE equipment maintenance was concentrated. Shenyang Chemical Industry, Yanshan Chemical Industry, Qilu Petrochemical, Dushanzi Petrochemical and other companies have arranged parking maintenance plans. The time ranges from one week to 40 days, and the affected output is nearly 200,000 tons/year. .
Maoming Petrochemical's 2#LDPE device maintenance was postponed to March 24, and its 350,000 tons/year HDPE will also be shut down around the 24th. The PE parking of Maoming Petrochemical Company affects 81,800 tons/year.
▶▶▶22 PC companies confirmed for installations for parking and maintenance
At present, domestic manufacturers only Lihua Yiweiyuan's 130,000-ton/year PC device maintains full-load operation, and other domestically-made devices have started to decline or shut down.
Domestic and foreign companies such as Covestro, Lotte Chemical, LG Chemical, Shanghai Mitsubishi, Sinopec Mitsubishi, etc. have arranged a more than one-month shutdown and maintenance plan this year.
▶▶▶BPA parking for maintenance for about 45 days
Not only the PC will be overhauled this year, but also from March to May, there are also many maintenance plans for the upstream BPA, and part of the maintenance will last for about 45 days.
▶▶▶Butadiene company parking for up to 40 days
The butadiene and downstream rubber plant of Fushun Petrochemical will be shut down on April 12th, and the initial estimated parking time will be about 40 days; Zhenhai Refining & Chemical's 165,000 tons/year butadiene plant overhaul time has been postponed from the initial March to April In May, the latest news may be postponed to the second half of May.
▶▶▶ABS companies will park for 40 days
Shanghai Gaoqiao plans to shut down a production line for about 45 days from mid to late March. Jilin Petrochemical plans to shut down the entire line for maintenance from the end of May to the beginning of July. The overall loss is estimated to be around 60,000 tons.
▶▶▶Styrene parking for maintenance up to 50 days
Panjin Baolai’s 350,000-ton/year plant is scheduled to shut down for 20 days on April 1st; Dongfang Petrochemical’s 120,000-ton/year plant will be shut down on March 3 and scheduled to be overhauled for 45 days; Yanshan Petrochemical’s 80,000-ton/year plant is scheduled to be overhauled in late March 50 days. ; Ningbo Daxie's 360,000-ton/year plant plans to shut down for maintenance for 1.5 months at the end of March, and the negative will fall to 70% at the beginning of March.
Who can't hold the game between upstream and downstream?
At present, major factories have increased their overhauls, and the supply of raw materials may become more tight. In addition, chemical giants such as BASF, Dow, Tenuo, Chemours and other chemical giants have "respected first" in April, and a new round of price increases seems inevitable.
This round of price increases is also the trend of the general environment. Central banks around the world are releasing water. Inflation expectations must first be reflected in the increase in commodity prices. On March 14, Tao Chuan, chief macro analyst at Soochow Securities, believed that "this is the fastest rise in commodities since the 21st century."
But in fact, this round of soaring raw materials is still priceless. Factories generally reserve raw materials for a few months in advance before the Spring Festival holiday. Therefore, in this round of price increases after the holiday, part of the downstream is still "watching the excitement", waiting for the price to drop before restocking.
If this state of priceless market continues, upstream companies will have a backlog of inventory, and to a certain extent, they will reduce prices in order to achieve sales. Some bosses believe that once the price is cut, the decline will be greater. Let's see now, in the end, the downstream can't support the order, or the upstream can't support the exchange!
However, as far as the current situation is concerned, there is still support for the chemical market to continue to rise, and the price increase of raw materials this time may continue for another 3-6 months!
First, the World Bank predicts that the global economy will grow by 4% in 2021. The prospects for the recovery of the global economy are relatively optimistic, with strong demand for chemicals and other bulk commodities. With the recovery of economic growth, companies' initiative to replenish inventories will increase demand for bulk commodities from the real economy and provide support for their price increases.
Second, in the short term, countries around the world have not completely withdrawn from the quantitative easing monetary policy plan. The Biden administration’s $1.9 trillion active stimulus plan has also officially landed. Inflation has exceeded expectations, further expanding from financial channels to demand for commodities.