International oil prices fell

Currently, both Brent and New York crude oil prices have fallen by more than 20% from their recent highs in June and have entered the “bear market” threshold. Analysts pointed out that the decline in crude oil prices is conducive to reducing costs for industries such as oil refining and chemicals. However, in the shadow of the overcapacity and sluggish demand, the decline in crude oil prices is unlikely to materially benefit the chemical industry.

Demand is low so that "Golden September" is no longer

Chemical market "Jinji" market hopes to fail after waiting for nearly a month. September-October was the traditional peak demand for commodities. However, due to insufficient market demand, this year's traditional peak season was not prosperous, and chemical product prices were generally weak. Most of them were still in the process of bottom adjustment.

The September China Commodity Supply and Demand Index (BCI) released by the Business Club was -0.44, with an average increase of -1.97%, reflecting the fact that the manufacturing industry contracted from the previous month and the economic downside risks increased. The overall commodity market was under downward pressure. Increase. In September, the domestic chemical market index was rapidly adjusted downwards, with an average monthly increase or decrease of -1.41%, representing an accelerated downward trend compared with August's -0.15%.

According to the price survey of business clubs, there were 39 kinds of goods in the chemical industry segment in the commodity price rise/fall list in September 2014, of which there were 4 kinds of goods which rose by more than 5%, accounting for 3.5% of the monitored goods in the sector; There are a total of 72 kinds of falling commodities, and there are 18 kinds of commodities that have fallen by more than 5%, accounting for 15.7% of the monitored commodities in the sector.

Business community chemical industry analyst Zhang Ming pointed out that in September, since the overall decline in the acetic acid industry chain, the entire chemical market showed a “broken window” effect. First, the aromatics market represented by **, toluene, and xylene declined. With the vitamin plate going down the altar, the current downtrend has spread to the bromine chemical industry chain and the phosphorus chemical industry chain. Originally relying on exports to pull the fertilizer plate, in late September encountered domestic demand for green and yellow fell back to meet the psychological needs of domestic distributors. The pesticide raw material segment represented by glyphosate also ended the upward trend under the constraint of sharp drop in export orders. Taken together, the domestic chemical market opened the prelude to “second decline” in September.

A brokerage analyst said that the current market demand is still the decisive factor in determining the domestic chemical market. Since the beginning of this year, the overall domestic chemical market has been in a situation where supply exceeds demand, and the prices of export products have decreased compared with the same period. At the same time, the number of investment projects in the petrochemical industry this year has decreased compared with previous years, and some projects under construction have been delayed.

Continued decline will be bad for the industry

Zhang Ming said that the drop in crude oil prices will help reduce the cost of raw materials for the petrochemical industry, but in the current unfavorable environment of low market demand and severe overcapacity, the decline in the price of crude oil has caused some petrochemical-related products to lose cost support, which is bad for the industry. Greater than good. The fall in prices of some chemical products in September was a response to the decline in crude oil prices. The aforementioned brokerage analysts said that if the long-term trend of crude oil prices declines, the chemical industry will be negatively affected. In general, when the price of crude oil rises, the downstream chemical products will also increase their prices, and generally the price increase will be greater, resulting in greater profit margins. However, when the price of crude oil falls, the performance of the downstream chemical industry will be unsatisfactory.

International crude oil fell from around US$96/bbl in early September to the current US$90/bbl, which caused significant negative effects on the olefin and aromatics markets. The prices of various aromatics in Southeast Asia fell sharply, with **, **, and PX respectively. It fell 2.9%, 5.9% and 11.8%. After the National Day of Ethic National Day in Southeast Asia, it also fell 2.6% from the holiday, and was reported at 1470 US dollars/ton. Recently, the domestic PDH plant was put into operation, which puts pressure on the price of propylene. Depressed by PX and PTA slumps, Shanghai Petrochemical's ethylene glycol section dropped 6.1%. Due to the continued inflow of deep-sea cargoes, the supply surged and Southeast Asian butadiene steadily dropped 10.2% after the holiday. In addition, the continued weakness of crude oil has brought severe pressure on the general plastics market. Due to the lack of cost boost, the supply of major products increased and the market started to accelerate downwards without any favorable supply and demand.

The continued decline in crude oil prices will also affect market sentiment. In the “buy up and not buy down” mentality, downstream distributors and intermediaries wait and see mood, and the market parties are still more cautious.

Concerned about the supply and demand improvement

Many analysts pointed out that the low international crude oil price is expected to continue for some time, and domestic demand will not be significantly improved in the short term. Under the dual factor, the decline in the price of chemical products may continue to be maintained. However, we should not ignore the seasonal factors and the improvement in demand brought about by changes in the supply and demand of the international market. We recommend that we pay attention to small varieties with improved supply and demand in the short term.

Polyurethane in the petrochemical industry chain is one of the few bright spots in the recent sector. The monitoring data of business clubs show that the aggregated MDI market has increased significantly after the holiday, mainly due to the influence of the manufacturers' listing. Wanhua and Huntsman's October listing price increased by RMB 600/t. At present, Wanhua offers at 16,200 yuan/ton-16,400 yuan/ton. Japan, South Korea offer at 15,800 yuan / ton -16,000 yuan / ton. The price of pure MDI and BDO also rose recently. It is understood that the rise in polyurethane prices is mainly due to the United States real estate warming pull polymerization MDI market, coupled with the lack of supply in the United States in the previous domestic market, there is a certain amount of leeway. Japan and South Korea’s sources of goods turned to U.S. exports, reducing exports to the country. 70% of domestic imports are dependent on Japan and South Korea, plus September and October are the traditional peak seasons for buildings, thus driving up the price of products.

In terms of inorganic products, the recent rise in the price of **** and methylene chloride in the fluorine chemical industry chain is more obvious. The main advantage is that: the downstream refrigerant market R32 manufacturers to maintain just needed, pharmaceutical manufacturers, adhesives, cleaning agents and other downstream manufacturers National Day before the active stocking, traders increased orders, resulting in low inventory, manufacturers order prices raise prices. Recently, manufacturers in Shandong may have a shutdown maintenance plan, which also helps boost market sentiment.