2015 propylene oxide trend or polarization

As a downstream product of propylene, the propylene oxide market in 2014 “kept on its own line”. Before Dec. 15, the prices were basically above 12,000 yuan/ton. Although the prices are fluctuating near the end of the year, the annual decline is only Half of the raw material, propylene (a drop of 40.6%), was calculated to be a rare and profitable product in the chemical industry last year. Throughout the year, capacity contraction under environmental protection factors was a direct cause of the 2014 price fluctuation of propylene oxide.

In 2015, the domestic propylene oxide market continued to improve, and the mainstream price steadily increased from the 11,000 yuan (tons, the same below) at the beginning of the year to the current 12,200 yuan, or about 10%. This round of price increase is mainly driven by two major factors: First, since January, raw material propylene has caused tighter prices due to the overhaul of some devices. According to statistics, domestic propylene prices have risen by about 20% since the beginning of the year. The formation of support for the propylene oxide market, the second is the demand, the downstream polyether manufacturers after the holiday started one after another, speeding up the release of stocking demand. The upward trend of the short-term market is still strong. With the arrival of the seasonal peak season in March and April, the demand for terminals is expected to increase significantly. In addition, the collective price of propylene oxide companies is relatively strong, and the market's gains in the first half of the year can be expected.

At present, the total domestic propylene oxide production capacity is approximately 2.8 million tons, of which the production capacity based on the chlorohydrin method accounts for more than 60%. Because of the disadvantages such as corrosion, waste water, and large amount of waste slag, the chlorohydrin plant has been frequently suppressed by environmental protection in recent years. In this year's ** work report, the issue of environmental protection has become the focus and hotspot of all walks of life. With the official implementation of the “tightest new environmental protection law” in 2015, the chlorohydrin law has doubled in pressure. Chemical Online believes that environmental protection factors will also be a major incentive for the price of propylene oxide in 2015.

From the perspective of production capacity, in 2014, the domestic new production capacity was approximately 560,000 tons, of which Jishen Chemical's 300,000-ton/year plant was put into operation in the first half of 2014, using Evonik/Wood HPPO technology; another Sinopec Changling Branch The 100,000-ton/year plant with its own HPPO technology was put into operation at the end of 2014. In 2015, the planned domestic production capacity will be around 600,000 tons, mainly including the Yantai Wanhua 240,000 tpa/year co-oxidation plant and the Jinling Huntsman new material 240,000 tpa/year co-oxidation plant, along with the two large plants. With the successive launch of production, the supply and demand structure of the domestic propylene oxide market will undergo major changes, and the worry of overcapacity will no longer be a worry.

From the point of view of imports, from 2012 to 2014, the import of propylene oxide in China has been maintained at about 400,000 to 500,000 tons. In 2014, the total domestic imports of propylene oxide reached 457,500 tons, an increase of 2.6% from 2013. The main importing countries are Thailand, Saudi Arabia and Singapore. The main importing province is Jiangsu Province. The probability of a significant drop in the import of propylene oxide in 2015 is relatively small, and it is basically maintained at more than 400,000 tons. The impact on the domestic market cannot be underestimated.

On the whole, although there are environmental factors to help out, the concentration of new production capacity and the high import volume will be a stumbling block to the market. Chemical Online believes that in 2015, the market trend of propylene oxide may show polarization. In the first half of the year, the uptrend may occur, and the second half of the year bears significant gains. In the long run, with the large-scale commissioning of propane dehydrogenation and coal (methanol) to olefins production, the increase in the production capacity of propylene downstream derivatives will be far greater than the increase in demand, and the pace of excess production of propylene oxide will also accelerate. , propylene oxide era of high profits or will never return!