Fundamentals continue to be strong, octanol prices have room for further upward movement
2023/8/24
Taking the sample of Shandong enterprises as an example, as of August 23, the gross profit of Shandong octanol enterprises on that day was around 5140 yuan/ton, with a profit margin of 41.79%. According to data statistics, the gross profit of octanol products currently ranks first among all chemical products. In the past two months, the price of propylene, the main raw material for octanol, has fluctuated between 6000 to 7000 yuan/ton, with relatively narrow cost fluctuations, and little impact on octanol product prices and profits. The profit trend of this product is mainly influenced by the fluctuation of product prices. With its strong fundamental performance, the focus of octanol gradually shifts upwards, bringing the octanol industry into a rich profit space.
High valent octanol gradually transmits downstream
From the perspective of price transmission of upstream and downstream products, the main downstream plasticizer products have followed the upward movement of raw material octanol prices, and plasticizer products maintain a slight profit, supporting their devices in medium to high load production. The rigid demand in the octanol market still shows good performance, and the downstream often continues cyclical replenishment operations. After the center of gravity of octanol prices rises to a stage high, even though the octanol market atmosphere is stagnant, the terminal gradually digests inventory and purchases raw materials in stages, resulting in a relatively short period of stalemate in the octanol market.
In the past two months, the reduction in production of octanol and plasticizer devices has caused a loss of supply, and the inventory of raw materials in the upstream, midstream, and downstream has remained low. End users have a demand for immediate replenishment, and phased procurement can continue the trading volume of the octanol market. After entering August, the spot production and sales rate of sample enterprises in octanol factories was less than 100% for a few times, with an average production and sales rate of 107%.
The new round of maintenance plan for octanol enterprises is about to start
In mid August, the octanol preliminary maintenance equipment resumed normal production, and the industry operating rate increased to around 98%. The octanol production was repaired, and price fluctuations were mild. From August 11th to 20th, the mainstream factory price of Shandong octanol fluctuated between 11700 to 11800 yuan/ton. This week, the octanol factory will usher in a new round of device maintenance. Jiangsu Huachang, Jilin Petrochemical, and Lihuayi octanol plants plan to stop and repair one after another within this week. By mid September, the industry's average operating rate will drop to around 87%. It is expected that some enterprises may reduce their production load due to the tight supply of raw material octanol downstream.
Due to the approaching maintenance time of the octanol device, downstream users have significantly increased their enthusiasm for stocking up this week. Mainstream octanol enterprises have no inventory, and some manufacturers are queuing up for spot orders to ship. Manufacturers are reducing pre-sale orders this week. The octanol market price once again opened a rapid upward trend in the middle of this week. On Wednesday, the Shandong octanol market rose 2.93% in a single day, while the Jiangsu octanol market rose 3.7% in a single day. The lack of supply in the octanol market in the later stage will continue to cause a tense situation in the supply side of octanol. Downstream users' raw material inventory levels are low, and the demand for octanol can support the high price operation. The industry fundamentals will continue to be strong, and there is room for octanol prices and profits to continue to rise.
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