Price trend

Last week, the fundamentals were still weak, but inventory was still controllable. At the same time, suppliers continued to raise prices, contract demand was stable, and spot buying was still insufficient. The domestic vinyl cyanide market remained deadlocked. As of July 25th, the mainstream negotiation for container self pickup at East China ports was between 8,000-8,100 RMB/ton, which was the same as last week’s previous week; The short distance delivery to the Shandong market was negotiated at around 7,900-8,000 RMB/ton, which was the same as last week’s previous week.

Analysis review

There are still expectations of supply growth in the short term:

The Haijiang plant was restarted within the week, and the 260,000 ton vinyl cyanide plant of Liaoning Jinfa Technology was planned to gradually restart from July 25th. The new 260,000 ton vinyl cyanide expansion plant of Jilin Petrochemical is planned to start production by the end of July. The supply in the north has increased, while a 130,000 ton production line of Zhejiang Petrochemical in the East China region stopped, and the load had dropped to around 75%, resulting in a decrease in supply. According to statistics, as of July 24th, the weekly capacity utilization rate of domestic vinyl cyanide factories was 74.77%, a decrease of 1.36% compared to last week’s previous week. The weekly output was about 81,600 tons, a decrease of 1,400 tons from the previous cycle.

The fundamentals remained weak, with local inventories continuing to rise, but overall they were still manageable. According to statistics, as of July 23, the sample inventory of vinyl cyanide factories in China was 50,600 tons, an increase of 0.16 million tons from last week.

Demand in small and medium-sized downstream Weakened :

The capacity utilization rate of the main downstream industries of vinyl cyanide varied, and the downstream acrylamide industry had seen a decrease in production, resulting in weakened demand in small and medium-sized downstream sectors. The utilization rate of ABS production capacity was 66.82%, an increase of 0.92% compared to last week’s previous week; The capacity utilization rate of acrylic fiber enterprises was 68.62%, unchanged from last week’s previous week;; The utilization rate of acrylamide production capacity was 45.24%, which was 4.66% higher than last week’s previous week;.

The price of propylene was fluctuating at a low level:

During the week, the price of propylene fluctuated at a low level, and the weekly production cost of vinyl cyanide increased slightly. According to statistics, the average production cost of vinyl cyanide last week was 8,751 RMB/ton, with a month on month increase of 0.41%. The average weekly profit of vinyl cyanide production during the same period was -700 RMB/ton, with a month on month decrease of 60 RMB/ton. The production loss situation continued.

Future outlook:

Overall, cost support was slightly insufficient, supply was still expected to grow, and downstream demand was weakened. It is expected that the short-term supply and demand relationship of vinyl cyanide will continue to be weak, and the market will remain stagnant and weak.

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