This week, the price of acrylonitrile in the domestic market increased significantly, with the ex-tank price in East China ports rising from 9,750 RMB/ton last week to the current 10,600 RMB/ton, an increase of 8.72% year-on-year. The earlier rise in the acrylonitrile market was mainly driven by strong cost-side support, but due to a lack of fundamental demand-side catalysts, the overall increase was limited. Entering late July, raw material propylene prices fluctuated downward. At the same time, supply-side positive factors emerged: Zhenhai Refining & Chemical’s 400,000-ton acrylonitrile plant gradually reduced its operating rate due to maintenance of the related methionine unit, leading to a significant decrease in supply in the East China region, which further accelerated the increase in acrylonitrile prices.
Currently, the domestic acrylonitrile industry capacity utilization rate is around 71.8%. Zhenhai Refining & Chemical plans to gradually reduce the operating rate to 50-60% in August. Meanwhile, Liaoning Jinfa plans to shut down one 130,000-ton production line for 20-25 days in mid-August. Although plants such as Siérbang, Jilin Petrochemical, and Tianchen Qixiang have restart plans in August, the incremental supply will mostly be released in the second half or late August. Therefore, it is estimated that the capacity utilization rate for the acrylonitrile industry in the first half of the month will drop to around 68-69%, resulting in tight overall supply. It is understood that Sinopec East China has already planned to reduce contract supply for August, prompting customers in the region to actively inquire and procure goods, further driving up market negotiations.
In addition, since June, the supply-demand fundamentals of the acrylonitrile industry have been in a weak equilibrium. Although prices fell due to insufficient demand during the period, industry inventories remained at low levels. The ongoing volatility in the external situation, coupled with overall weakening of end-user consumption, has kept both buyers and sellers in the acrylonitrile market operating with low inventories. Entering July, fluctuations on both the cost and supply sides further reduced inventories, providing the foundation for the current rapid price increase.
However, during the recent rapid rise in acrylonitrile prices, raw material propylene prices fluctuated downward. As a result, calculations indicate that acrylonitrile production has shifted from a loss to a slight profit. Currently, some acrylonitrile plants that have shut down or reduced operating rates are primarily due to the shutdown of related upstream or downstream units. As profitability improves, this may prompt acrylonitrile factories to consider measures such as purchasing raw materials externally or handling by-products to adjust production plans. Therefore, supply-side uncertainties continue to exist. Additionally, according to the original plan, there is an expectation of significant supply increases in mid-to-late August, which will to some extent restrain the ongoing price rise.
Comments
0