Wanhua Chemical once again stopped production for maintenance!
MDI’s cumulative increase in the third quarter reached 4,000 yuan/ton
On August 11, Wanhua Chemical issued an announcement stating that based on the characteristics of the production process of chemical companies, in order to ensure the safe and effective operation of production equipment, in accordance with the annual maintenance plan, the company’s Yantai Industrial Park MDI integration (mainly including MDI 1.1 million tons/year, TDI 300,000 tons/year), petrochemical integration (mainly including PDH 750,000 tons/year, PO/MTBE 24/760,000 tons/year) and related supporting equipment will be shut down for maintenance on August 15, 2023, and the maintenance is expected to be 40 About days.
According to the announcement, this production shutdown is a routine maintenance based on the annual plan and will not have an impact on the company’s production and operations.
Previously, on the evening of July 14, Wanhua Chemical issued an announcement regarding the suspension of production and maintenance of the equipment of its subsidiary Hungarian Boside Chemical Company.
Wanhua Chemical stated that according to the characteristics of the production process of chemical enterprises, in order to ensure the safe and effective operation of production equipment, in accordance with the annual maintenance plan, the TDI unit (250,000 tons/year) of the company’s subsidiary Hungarian BorsodChem Zrt. Production will be stopped for maintenance on July 15, 2023, and the maintenance is expected to take about 30 days; the MDI device (350,000 tons/year) will be stopped for maintenance and maintenance on July 18, 2023, and technical transformation will be carried out to expand capacity. After the technical transformation, the production capacity It will be increased to 400,000 tons/year, and the maintenance is expected to take about 80 days. This shutdown for maintenance is a routine maintenance carried out according to the annual plan and will not have any impact on the company’s production and operations.
Recently, the main MDI manufacturers have released news about maintenance. In addition to Wanhua Yantai equipment, Tosoh Ruian equipment is also under maintenance. Overseas, many equipment such as Kumho in South Korea and Tosoh in Japan have also stopped for maintenance, and both internal and external supplies have shrunk. , manufacturers have a positive attitude towards raising prices, which has led to a sharp rise in the price of pure MDI. According to statistics, since the third quarter, the cumulative increase in pure MDI has reached about 4,000 yuan/ton.
Wanhua Chemical MDI price from January to July 2023
January: Polymer MDI 16,800 yuan/ton, pure MDI 20,500 yuan/ton;
February: Polymer MDI 17,800 yuan/ton, pure MDI 22,500 yuan/ton;
March: Polymer MDI 19,800 yuan/ton, pure MDI 24,500 yuan/ton;
April: Polymer MDI 19,800 yuan/ton, pure MDI 22,000 yuan/ton;
May: Polymer MDI 18,800 yuan/ton, pure MDI 22,800 yuan/ton;
June: Polymer MDI 18,800 yuan/ton, pure MDI 23,300 yuan/ton;
July: Polymer MDI 18,800 yuan/ton, pure MDI 23,300 yuan/ton.
Analysis of the causes behind the surge in prices
In addition to MDI, the prices of chemical commodities have been rising frequently recently. The once deserted market has suddenly become active. Suspension of production and maintenance has accelerated the recovery of product prices. At the same time, policy boost and market demand have further promoted the market recovery.
Recently, a meeting of the Political Bureau of the Central Committee was held to set the main tone for economic work in the second half of the year. The meeting pointed out that the current economic operation is facing new difficulties and challenges, mainly due to insufficient domestic demand. The meeting emphasized the need to actively expand domestic demand, give full play to the fundamental role of consumption in driving economic growth, expand consumption by increasing residents’ income, drive effective supply through terminal demand, and organically combine the implementation of the strategy of expanding domestic demand with deepening supply-side structural reforms.
In addition, among the factors causing the price increase of chemical products, there is an important factor, that is, the mother of energy is changing. China’s coal prices are showing signs of bottoming out, and black energy prices seem to have bottomed out. International crude oil prices have been rising since June 28. Even when the crude oil pressure reached the pressure level on July 7, it suddenly broke through the top pressure and went straight into the sky, from US$72/barrel to US$79/barrel.
Affected by the rise in crude oil prices and the stabilization of coal prices, many downstream petroleum products, such as styrene, pure benzene, PP, PVC and so on, have followed suit.
The price of raw materials is rising, the price of intermediate products is rising, and the consumption of end products is unaffordable. The inability to raise terminal consumption is mainly reflected in two aspects. On the one hand, the consumption volume cannot be raised, and on the other hand, the consumer price cannot be raised. These two factors are complementary to each other. As sales increase and demand increases, prices will naturally increase. Just got up.
Therefore, the current rise in commodity prices is not only detrimental to economic recovery, but will also hinder economic recovery from the expansion of consumption.
According to the analysis of relevant people, in this round of economic recovery, the consumer side must be the first to recover. If the consumer side does not recover, all recovery will be an illusion. The recovery of the consumer side can be the recovery of domestic demand, or it can be said to be the recovery of overseas exports. . No matter which kind of recovery, China’s economic environment will improve. Therefore, this wave of rise will not last long. As long as energy prices fall again, commodities will still fall. The current state is not friendly to the recovery of China’s economy.