Overview of ethylene oxide prices in December

In December, the price of ethylene oxide remained stable. According to data from Business Society, as of December 29th, the average price of ethylene oxide in the domestic market was 6400 yuan/ton; From a regional perspective, the epoxy ethane market in East China is priced at 6400 yuan/ton externally; The listed price of ethylene oxide in the South China market is 6500 yuan/ton; The listed price of epoxy ethane in North China is 6400 yuan/ton; The listed price of epoxy ethane in the central China market is 6400 yuan/ton; The listed price of ethylene oxide in Northeast China is 6300-6350 yuan/ton.

Overview of the ethylene oxide industry chain

The main downstream polycarboxylate water reducing agent monomer enterprises have low inventory, relatively stable production, and relatively stable demand for ethylene oxide. The rest of the downstream enterprises mainly operate steadily; From the recent upstream and downstream product prices, it can be seen that downstream prices have started to rise, increasing profit margins and strengthening support for the price of raw material ethylene oxide in the short term.

Short term supply may slightly increase, but prices are unlikely to improve in January

The demand for downstream products of ethylene oxide remains stable, and recently, ethylene oxide has been operating steadily. Jiangsu Silbang device may restart, with limited increment nationwide. The main downstream industries have not undergone significant changes in production, with stable orders being the main focus. It is expected that the price of ethylene oxide will remain weak and stable in the short term.

According to monitoring data from Business Society, as of December 25, 2023, the reference market price of domestically produced industrial grade propylene glycol was 8300 yuan/ton. Compared with December 1 (reference price of propylene glycol was 8066 yuan/ton), the price increased by 234 yuan/ton, an increase of 2.89%.

From the monitoring chart of Business Society data, it can be seen that in December, the overall domestic propylene glycol market experienced an upward trend. In the first ten days, the domestic propylene glycol market saw a narrow increase, with an increase of 0.83% in the first ten days. In the later stage, the overall upward trend of the domestic propylene glycol market has relaxed, with a 2.05% increase in the second half of the year. As of December 28th, the domestic propylene glycol market price is around 8200-8400 yuan/ton.

Analysis of supporting factors for the upward trend of propylene glycol market:

In terms of supply: As we enter December, the overall operating rate of the domestic propylene glycol market is low. Due to the continued weak downstream of propylene glycol in the early stage, some factories have delayed the maintenance of propylene glycol equipment. Although downstream demand is average, with the slow shipment of propylene glycol on site, the pressure on the supply side of propylene glycol is gradually decreasing, and supply in some regions is tightening. Therefore, after entering December, the supply side has provided certain support to the propylene glycol market.

In terms of exports: In mid December, the overall export orders for propylene glycol increased, and the improvement in export demand combined with the overall tight supply in the market supported a broad upward trend in the propylene glycol market.

Market analysis of propylene glycol

At present, the overall trading atmosphere in the propylene glycol market is mild, and the mentality of propylene glycol operators is good. The overall supply side pressure on the market is relatively small, but after small-scale downstream stocking, demand has weakened. According to the propylene glycol data analyst from Business Society, in the short term, the domestic propylene glycol market is mainly subject to narrow range adjustment and operation, and the specific trend still needs to pay more attention to changes in supply and demand news.

According to data monitored by Business Society, at the beginning of the year, the mainstream ex factory price of Shanxi light potassium carbonate, including tax, was 9100.00 yuan/ton. At the end of the year, the mainstream ex factory price of Shanxi light potassium carbonate, including tax, was 7530.00 yuan/ton, a decrease of 17.25%. The lowest price of Shanxi light potassium carbonate for the whole year was 7100.00 yuan/ton on August 11th, with the largest decline of 21.98%.

Potassium carbonate

The decline in the potassium carbonate market in 2023 is greater than the increase. From the above chart, it can be seen that the potassium carbonate market has been on a downward trend for 7 months of the year, with a decline for 4 months. The highest increase was in September, with a maximum increase of 1.89%. The largest decline occurred in June, with a maximum drop of 5.38%. The continuous decline in the potassium carbonate market is mainly due to the overall low volatility of the raw material potassium chloride market, poor cost support, poor downstream operating rates, weak transactions in the potassium carbonate market, and a continuous decline in the market.

In 2023, the potassium chloride market showed a trend of first falling and then rising. The domestic potassium chloride market has had poor transactions throughout 2023, with abundant port inventory. In the first half of the year, the supply of potassium fertilizer for the China Europe freight train increased, and agricultural demand weakened, while industrial demand was average. Downstream enthusiasm for purchasing potassium chloride weakened. The market is declining. Although the autumn fertilizer preparation was launched earlier in the second half of the year, the improvement of the potassium fertilizer market was limited. Throughout the year, the decline was greater than the increase, which could not provide strong support for potassium carbonate.

Recently, port inventories have been high, and the market for potassium chloride is not optimistic. Downstream market demand is weak, and it is expected that the price of potassium carbonate will mainly decline in the short term. The long-term market still needs to wait and see.

According to the Commodity Market Analysis System of Business Society, the domestic cyclohexanone market in December saw a first mover and then an increase. From December 1st to 26th, the average price of cyclohexanone in the domestic market first fell from 9406 yuan/ton and then rose to 9412 yuan/ton, an increase of 0.07%, with a maximum amplitude of 0.94%, and a year-on-year increase of 2.31% in price.

At the beginning of the month, the raw material pure benzene was weakly declining, and Sinopec lowered its listing to 7200 yuan/ton. The cost side was weak, and downstream chemical fibers and solvents were purchased on demand. The spot supply of cyclohexanone was not high, but under the resistance of high price shipments, some companies lowered their prices, and the transaction center of the cyclohexanone market fell.

In the first half of the month, the raw material pure benzene was lowered, and Sinopec was listed to lower it to 6800 yuan/ton, lacking cost support. Downstream demand is weak, and the domestic cyclohexanone market is weak and downward, resulting in a lower focus on transactions.

In mid month, the raw material pure benzene oscillated and operated with stable cost support. Downstream demand is average and often followed up on demand. Some companies are temporarily not shipping, coupled with good follow-up of chemical fiber orders last week, resulting in a decrease in factory low price quotations and a decrease in market low prices.

As the end of the month approaches, the domestic price of cyclohexanone tends to be strong, leading to an increase in the raw material pure benzene market and providing good cost support. The spot supply of cyclohexanone has slightly decreased, with downstream companies following up on demand. Driven by cost and supply factors, the market is actively exploring an increase.

On the cost side, the domestic pure benzene market fell first and then rose in December. As of December 26th, the benchmark price of Shengyishe pure benzene was 7050.50 yuan/ton. In the cost composition of the traditional cyclohexanone process route, pure benzene accounts for 53%. The market trend of pure benzene directly affects the price trend of cyclohexanone, and the short-term cost of cyclohexanone is influenced by positive factors.

On the demand side, the domestic caprolactam market saw a significant increase in December, with cyclohexanone units mainly supporting downstream caprolactam production. Caprolactam is one of the main downstream sources of cyclohexanone. Some enterprises are undergoing equipment maintenance or planning to reduce production, resulting in a tight supply of spot goods in the market. As of December 26th, the benchmark price of caprolactam for Shengyishe is 13648.75 yuan/ton. The demand for cyclohexanone is temporarily positive.

In the future market forecast, the cost support is good, and downstream will follow up as needed. Currently, there is no inventory pressure on enterprises. Business Society cyclohexanone analysts predict that the domestic cyclohexanone market will tend to be strong and consolidate in the short term.

According to the Commodity Market Analysis System of Business Society, from December 18 to December 25, 2023, the ex factory price of hydrogenated benzene in North China increased, reaching 7133 yuan/ton this week and 6866 yuan/ton last week, up 3.88%.

In terms of crude oil: Angola’s decision to withdraw from OPEC has raised doubts in the market about the sustainability of OPEC+production cuts, leading to a decline in international oil prices. On December 22nd, international crude oil futures closed lower, with the settlement price of the main WTI crude oil futures contract in the United States at $73.56 per barrel, a decrease of $0.33 or 0.5%. The settlement price of Brent crude oil futures main contract was 78.80 yuan/barrel, a decrease of 0.36 US dollars or 0.5%.

On December 20th, Sinopec’s listed price of pure benzene increased by 150 yuan/ton to 6950 yuan/ton.

Other companies: Jingbo Petrochemical quoted 7200 yuan/ton, HSBC Petrochemical quoted 6950 yuan/ton, Weilian Chemical quoted 7053 yuan/ton, Xinhai Petrochemical quoted 7200 yuan/ton, and Hongrun Petrochemical quoted 6950 yuan/ton.

According to the Commodity Market Analysis System of Business Society, the price of pure benzene has slightly increased this week. On December 18th, the price of pure benzene was 6837 yuan/ton, and on Friday (December 22nd), the price of pure benzene was 7080 yuan/ton, an increase of 3.76% from last week and 8.38% from the same period last year.

K-bar chart of commodity prices, using the concept of price trend K-line, reflects the weekly or monthly price fluctuations in the form of a bar chart. Investors can buy and sell based on the changes in the K-bar chart. Red indicates an increase; Green indicates a decline; The height of the K-bar represents the range of fluctuations. The weekly K-bar chart of pure benzene shows a significant increase in the pure benzene market recently.

In terms of the industrial chain, the crude oil market fell first and then rose during the week, and the styrene market overall strengthened. Due to the impact of transportation, the delivery of pure benzene in East China is not good, and the bullish mentality of the spot market has increased. In terms of demand, downstream stocks have been replenished recently, and market trading has been active. Sinopec raised the listing price of pure benzene to 6950 yuan/ton and increased it by 150 yuan/ton within the week. Supported by multiple positive factors, the overall pure benzene market rose this week, driving a significant rebound in the hydrogenated benzene market.

This week, the upward trend in the pure benzene market has driven an overall positive atmosphere in the industrial chain. Sinopec’s listed price has been raised to 6950 yuan/ton, and the ex factory price of hydrogenated benzene in the main production areas has risen to 7100-7200 yuan/ton. Market negotiations have performed well. In terms of supply, the operating rate of hydrogenated benzene enterprises has not changed much this week, and the overall supply of hydrogenated benzene is still acceptable. In terms of demand, downstream enterprises are expected to see a rebound in operating rates in the near future, and the overall improvement in market demand in the future has once again boosted market sentiment. In recent times, the hydrogenated benzene market has closely followed the trend of pure benzene, and in the future, it is expected that the hydrogenated benzene market will operate stronger in the short term, with upward potential, boosted by the favorable industrial chain.