Since July, the upstream varieties of the resin industry chain have shown an upward trend, and the increase has expanded significantly in September. Among them, maleic anhydride in Jiangsu liquid anhydride, for example, has increased by 45.85% compared with the beginning of the third quarter, and the overall trend is relatively strong.
Resin industry chain varieties showed a rising trend, and compared with the beginning of the third quarter has significantly expanded, among which the top three varieties of maleic anhydride, crude benzene, styrene, the increase of more than 39%, the highest increase of 45.85%. And the rest of the varieties also have varying degrees of higher.
This upward trend is caused by the cost, and the performance of the supply side. The continued strength of crude oil in September provided a boost to the performance of chemicals, and the bulk varieties showed a rise in performance, and with the entry of downstream stocking period, just need to increase one after another, but also to drive prices.
Since September, the resin raw material maleic anhydride has further expanded, exceeding market expectations, and the maleic anhydride supply shortage pattern is still difficult to change during the stock period, in addition to the supply side support, the rest of the support is still favorable to be released.
Crude oil and chemicals are associated or sustained
Us crude oil has risen 26.84% from the beginning of the third quarter, since September, crude oil production cut news continued to drive oil prices, Saudi Arabia extended additional production cuts, and Russia cut supply and other news are good oil prices, in addition to the OPEC monthly report on this year and next two years demand prospects are optimistic, or oil prices are still boosted, the current oil has reached above $90. During the traditional gold nine silver ten peak season, the correlation between domestic chemicals and crude oil has increased significantly, so there is still support for commodities under the strong trend of oil prices, and the follow-up or good guidance is still favorable.
In addition, near the peak season of fuel demand, crude oil and liquefied gas prices are expected to be supported, pay attention to the follow-up oil price performance, and Saudi CP price guidance for domestic n-butane prices.
The supply pattern remains intractable
The operating rate of maleic anhydride industry in 2023 and the operating rate of butane process have little change compared with the same period in 2022. According to monitoring, the operating capacity of butane maleic anhydride in September 2023 is near 1.2 million tons, and the operating capacity of maleic anhydride in September 2022 is near 1.1 million tons, so the actual increase of maleic anhydride production capacity in 2023 is not up to expectations.
At present, with the need to continue to enter the market during the stock preparation period, once again pushing up the price of maleic anhydride, the spot on the floor is difficult to inquire, and under the low position of the cargo holder, the maleic anhydride factory order execution cycle is still extended. In terms of the current maleic anhydride supply pattern, it is difficult to enter new production capacity in September and October, although Hebei’s new production capacity is about to heat up and run, it still needs to run and debug time, and it is difficult to release spot on the market in September; Although the new device in Henan may lift the load or the third line may continue to operate, Qixiang Tengda began to stop 100,000 tons in early October to reduce the impact of local supply increment. Therefore, the supply pattern is difficult to break temporarily, and the spot tension of maleic anhydride in September may continue.
The key factor that will affect the operation of the industrial chain is still demand
According to monitoring, with the expansion of raw materials in September, the UPR has also followed the rise of raw materials, and the UPR has increased by 14.61% from the beginning of the third quarter, which is far lower than the rise of raw materials. In September, the UPR industry started to move closer to 40% of the load, which was significantly increased compared with 2022, and the demand for maleic anhydride also increased.
The large increase in resin raw materials has significantly increased the cost of resin production, although there have been signs of avoiding the risk of high prices on the floor. However, the current situation of maleic anhydride spot tension may continue, in the cost, supply is still good maleic anhydride price operation, superimposed crude oil and other chemicals performance boosted by maleic anhydride market prices have reached a high point in the year. In the short term, the cost and supply pattern is difficult to break the background, maleic anhydride is still high, but it continues to rise, and the rising cycle, we need to pay attention to the continuity of resin orders and the ability to start after the increase in resin costs.