Propylene hits the market in late July

The current “stagflation” feature of the global economy determines this characteristic of commodity movements: it falls when economic performance “lags”, and it rises when “expansion” is expressed. Chemical products, driven by oil prices in the near future, have mostly followed the upward trend of the market, while the demand for some products after the high position has been weak, and the risk of high market prices has increased.

In July, the propylene market rose all the way, externally due to strong and tight market support.

Good aspects:

1. The recent upward trend in oil prices supports the market mentality. European debt crisis With the introduction of the Greek rescue plan, concerns have eased slightly. However, with the recent upsurge in the situation, the rating of government bonds has been lowered again. The situation of the U.S. debt crisis has been drastically reversed. There has been no consensus reached, and the risk of the US credit rating being lowered has increased rapidly.

2. The outer disk rose and operated at a high level. The recent increase in the price of propylene outside the disk has continued. Up to now, a total of 135 US dollars rose in July, an increase of up to 10%. On the one hand, the recent increase in prices is on the one hand with good downstream demand. On the other hand, some installations were overhauled in August to enhance market expectations.

3. Domestic refineries, especially in Shandong, have reduced their supply. In July, Shandong's refinery planned or planned to reduce the supply; combined with the current refinery profits, the operating rate is not high, the amount of propylene processing is limited, coupled with the normal demand, refinery inventory is not high, there is a basis for price increases.

4. Downstream market prices rose support. Doing its best in the long-term downturn, the epoxy products market in July quickly reversed, the gains supported the operating rate and market sentiment, and the demand for propylene improved. Polypropylene powder market is also driven by oil prices and low inventory, prices continue to rise, despite the recent decline in the price gap with propylene, but most still maintain the start, the emergence of large-scale parking did not appear, but also support the propylene market consumption.

Advantages:

1. Downstream equipment overhaul, reduce demand. In July, the overhaul of the equipment was found in butyl octanol and epichlorohydrin, and most of them were concentrated in the middle of the month. On the 16th and the 18th, Qilu Petrochemical and Lihua Yiding octanol began to be overhauled. The time was 10-15 days, and construction started at the beginning of next month. On the 12th, China Chine's refined epichlorohydrin plant was parked. There was no start-up plan for this month. On the 19th, Qixian Huaxiang Chlorine stopped. There is no specific starting time.

2. The port source arrived to supplement. Most of the imported goods arrived in Shandong this month, mostly concentrated in the middle and late. However, under the tight supply of the market, the market sentiment was temporarily suppressed.

3. Temporary volume, increase supply. After Qilu Petrochemical butyl octanol was overhauled, propylene resources were exported and supplemented by the neighboring polypropylene manufacturers. The polypropylene plant in Jinan Refinery temporarily parked and temporarily exported propylene for a total of 10,000 tons on the 3rd.

At the beginning of August, there were still changes in the start-up of the upstream and downstream markets.

In terms of petrochemicals, domestic Shanghai SECCO, Dushanzi Petrochemical, and Yanshan Petrochemical have maintenance plans in August, with a time range of 20-30 days. Asian regions include Japan's Mitsubishi, Mitsui, Singapore Petrochemical, Singapore Shell, Formosa Plastics and other equipment maintenance plan exists.

On the polypropylene side, Qingdao Daqing Refinery, Daqing Petrochemical, Jinxi Petrochemical, and Shenhua Ning Coal plans to start construction at the beginning of August and the Shenhua Baotou maintenance plan will be around August 20. The recovery of large areas started, making the polypropylene market still under pressure, and whether the market can be worth paying attention.

As for octyl alcohol, Qilu Petrochemical and Lihuayi equipment plans to resume construction at the beginning of August and propylene consumption is increasing. It is expected that the export of Qilu propylene will also be significantly reduced.

Regarding epichlorohydrin, although there is no specific start time for the current parking facilities, there are some intentions for recovery at the beginning of August, which also increases the consumption of propylene to some extent.

Propylene supply in Shandong will show an increasing trend. Oriental Hualong and Guangrao Zhenghe will finish repair and resumption of construction in early August. At present, only the HSBC petrochemical maintenance plan is known.

Therefore, the current propylene market continues to be good and bad game, there is also the possibility of mutual transformation, so in the case of changes in the supply and demand plan, whether it can step in line with the adjustment, limiting the short-term propylene market changes. However, at the current high level, the global economic recovery has suffered a series of ups and downs. The recent European debt and US debt problems have plagued merchants, and the market's cautious attitude has increased. There is no lack of mentality for the expected correction. Continuing to spur high levels during the year will still require new positive stimulus.