2023/5/22 Raw materials and supply drive maleic anhydride to stop falling at a low level, but the continued price driving force is insufficient
With raw material n-butane and maleic anhydride prices successively lowered to nearly two years low range, the market weak sentiment has eased, but the periphery is unstable, and the resin industry chain in some raw material varieties supply and demand logic on the lack of price orientation, still increase the field cautious mentality.
However, the raw material and supply side of maleic anhydride provided support for prices to stop falling during this cycle.
As shown above, n-butane price performance, n-butane prices in mid-May lowered to a new low of nearly two years, well below the level of the same period in 2022, down by 30.83% year-on-year. Therefore, market participants for n-butane continue to lower expectations, but last weekend the market unexpected news, news that iso-octane will be levied consumption tax, although not issued official documents, but the panic triggered by the intense, its related varieties of liquefied gas and alkylated oil market response quickly, especially in the raw material end of the liquefied gas, down fierce. If the excise tax is implemented, it will mean that some of the independent alkylation units cannot afford the additional excise expenditure, and the start-up rate of the alkylation units may drop, which will then affect the output of n-butane.
The news of the excise tax has not yet landed, but refineries to avoid the risk of increased inventory, shipments intentions to improve, but high purity n-butane because the current production is not high thus supporting the shipments without worry, however, the substantive supply did not appear to be significantly reduced, sustained upward momentum is not enough, in addition to n-butane need to pay attention to the end of the month Saudi Arabia announced the June butane CP price guidance, there is currently a downward adjustment is expected, fear is not conducive to domestic n-butane price stability. Therefore n-butane is difficult to continue to provide support to the cost side of maleic anhydride.
This cycle of maleic anhydride industry start rate has dropped significantly, due to the South China liquid anhydride plant accidental reactor failure (has now returned to normal), and Shandong and other regional concentration into the impact of maintenance cycle, maleic anhydride industry operating level down to 65% below, supply concentration reduction significantly, but supply reduction is not a long-period behavior, since the next cycle of partial supply will return to normal levels, in addition to the new device in Shandong has been put into operation. The next cycle or output volume, when the North China regional supply shrinkage situation will be alleviated.
In summary, the raw materials and supply side of the good follow-up from the positive to negative signs, then unfavorable to maleic anhydride sellers market operation, and before the end of May maleic anhydride need to pay attention to the resin new orders to follow up the situation.