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Strong upward trend in octanol market
2023/9/5
Since mid June, due to the overall tight supply in the market, the octanol market has entered a strong upward channel. As of August 25th, the mainstream factory price in the Shandong market was between 12700 to 12800 yuan (ton price, the same below), an increase of 4250 yuan or 50% compared to mid June.
From late August to October, there will be 6 sets of octanol units planned for maintenance in China, resulting in a significant loss in octanol supply. However, September to October is also the traditional peak demand season for octanol, and with the simultaneous support of good supply and demand, it is expected that the octanol market will continue to operate stronger. "said Liu Wenluan, an octanol analyst at Longzhong Information.
Low inventory level
From June to July this year, due to the maintenance or temporary shutdown of multiple octanol units such as Daqing Petrochemical Company, the overall market supply was tight. However, due to the slow increase in octanol consumption during the same period, the supply-demand contradiction is not obvious.
However, from late August to October, there will be 6 sets of octanol units in China with maintenance plans. According to Longzhong Information, the maintenance devices mainly include 160000 tons/year of Jiangsu Huachang Chemical Co., Ltd., 240000 tons/year of Jilin Petrochemical, 140000 tons/year of Dongying Lihua Yilijin Refining and Chemical Co., Ltd., 80000 tons/year of Sichuan Petrochemical, 255000 tons/year of Qilu Petrochemical, and 120000 tons/year of CNOOC Shell Petrochemical. The total supply loss during this period can reach 67900 tons.
Due to the significant maintenance loss of octanol devices and the limited inventory of other octanol factories, some downstream plasticizer enterprises have taken the opportunity to stop and repair the devices. The loss of production in the upstream and downstream has led to a continued low inventory of products in the industrial chain, "Liu Wenluan said,
As the maintenance time for three sets of octanol devices approaches recently, downstream users' enthusiasm for stocking has significantly increased. Mainstream octanol enterprises have no inventory, and some manufacturers have queued up spot orders for shipment. Manufacturers have recently reduced their pre-sale order volume.
Rich profits
It is reported that due to its own supply and demand characteristics and factory sales decisions, the profit of the octanol industry has always been relatively high.
Taking Shandong enterprises as an example, as of August 23, the gross profit of Shandong octanol enterprises on that day was around 5140 yuan, with a profit margin of 41.79%. According to data from Longzhong Information, the gross profit of octanol products currently ranks first among all chemical products. The profit trend of this product is mainly affected by product price fluctuations, and with its strong fundamental performance, the center of gravity of octanol prices gradually shifts upward, bringing the octanol industry to a rich profit range. "Liu Wenluan said.
Octanol is a chemical product with limited domestic resources. Due to the intensified supply side fluctuations in the second and third quarters, the market continues to rise. From late August to October, multiple sets of main octanol units in China will be concentrated for long-term shutdown and maintenance, and the supply gap will be further amplified. The strong upward trend of the market will continue. The quantity of octanol products will continue to be scarce, and the industry will basically remain independent of upstream costs and downstream demand, maintaining a strong pattern, and profitability will increase We will continue to maintain a leading position in the organic chemical industry market through enhanced development Zhuochuang Information analyst Liu Dongyuan said.
As the maintenance time for multiple devices approaches, the price of octanol has rapidly increased again in the near future. As of August 23, the Shandong octanol market has increased by 2.93% per day, while the Jiangsu octanol market has increased by 3.7% per day. The loss of supply in the octanol market in the later stage will continue to tighten the supply of octanol, and downstream user raw material inventory will remain low. octanol needs to be able to support its high price operation, and industry fundamentals will continue to be strong. octanol prices and profits will continue to be strong Uplink space Liu Wenluan said.
Due to weak downstream demand for octanol, there is no profit advantage in the propylene industry chain, and investment risks are high. Therefore, few enterprises are willing to invest in the construction of octanol plants. The production of octanol requires the participation of synthetic gas, which in turn limits the idea of enterprises building octanol plants, so in recent years, the new production capacity of octanol has been limited.
The existing octanol plants all co produce butanol, which has the potential to convert butanol to octanol. However, due to the conversion of butanol to octanol, it is necessary to incorporate the condensation unit on the basis of maintaining the original production chain. The integration of the system takes about a week, which not only brings a one week production loss to the manufacturer, but also increases operational difficulties and marketing costs by changing process conditions. Therefore, the practice of increasing octanol production through device conversion is also limited.
The downstream of octanol is mainly concentrated in environmentally friendly plasticizers such as dioctyl terephthalate (DOTP). With the rise of environmentally friendly plasticizers, DOTP's new production capacity continues to expand, and the overall procurement quantity of octanol has steadily rebounded. Given the difficulty in increasing the supply of octanol, an increase in demand will be beneficial for the rise in octanol prices.
At the same time, the concentration of the octanol industry is relatively high, and the bargaining power is mainly concentrated in the hands of leading enterprises. The bidding sales model adopted by leading enterprises leads to severe fluctuations in product prices. On August 10th, the limited bidding of large octanol factories and the active participation of downstream factories led to an increase of 500-600 yuan in the transaction price of the octanol market on that day.
From late August to October, there will be 6 sets of octanol units planned for maintenance in China, resulting in a significant loss in octanol supply. However, September to October is also the traditional peak demand season for octanol, and with the simultaneous support of good supply and demand, it is expected that the octanol market will continue to operate stronger. "said Liu Wenluan, an octanol analyst at Longzhong Information.
Low inventory level
From June to July this year, due to the maintenance or temporary shutdown of multiple octanol units such as Daqing Petrochemical Company, the overall market supply was tight. However, due to the slow increase in octanol consumption during the same period, the supply-demand contradiction is not obvious.
However, from late August to October, there will be 6 sets of octanol units in China with maintenance plans. According to Longzhong Information, the maintenance devices mainly include 160000 tons/year of Jiangsu Huachang Chemical Co., Ltd., 240000 tons/year of Jilin Petrochemical, 140000 tons/year of Dongying Lihua Yilijin Refining and Chemical Co., Ltd., 80000 tons/year of Sichuan Petrochemical, 255000 tons/year of Qilu Petrochemical, and 120000 tons/year of CNOOC Shell Petrochemical. The total supply loss during this period can reach 67900 tons.
Due to the significant maintenance loss of octanol devices and the limited inventory of other octanol factories, some downstream plasticizer enterprises have taken the opportunity to stop and repair the devices. The loss of production in the upstream and downstream has led to a continued low inventory of products in the industrial chain, "Liu Wenluan said,
As the maintenance time for three sets of octanol devices approaches recently, downstream users' enthusiasm for stocking has significantly increased. Mainstream octanol enterprises have no inventory, and some manufacturers have queued up spot orders for shipment. Manufacturers have recently reduced their pre-sale order volume.
Rich profits
It is reported that due to its own supply and demand characteristics and factory sales decisions, the profit of the octanol industry has always been relatively high.
Taking Shandong enterprises as an example, as of August 23, the gross profit of Shandong octanol enterprises on that day was around 5140 yuan, with a profit margin of 41.79%. According to data from Longzhong Information, the gross profit of octanol products currently ranks first among all chemical products. The profit trend of this product is mainly affected by product price fluctuations, and with its strong fundamental performance, the center of gravity of octanol prices gradually shifts upward, bringing the octanol industry to a rich profit range. "Liu Wenluan said.
Octanol is a chemical product with limited domestic resources. Due to the intensified supply side fluctuations in the second and third quarters, the market continues to rise. From late August to October, multiple sets of main octanol units in China will be concentrated for long-term shutdown and maintenance, and the supply gap will be further amplified. The strong upward trend of the market will continue. The quantity of octanol products will continue to be scarce, and the industry will basically remain independent of upstream costs and downstream demand, maintaining a strong pattern, and profitability will increase We will continue to maintain a leading position in the organic chemical industry market through enhanced development Zhuochuang Information analyst Liu Dongyuan said.
As the maintenance time for multiple devices approaches, the price of octanol has rapidly increased again in the near future. As of August 23, the Shandong octanol market has increased by 2.93% per day, while the Jiangsu octanol market has increased by 3.7% per day. The loss of supply in the octanol market in the later stage will continue to tighten the supply of octanol, and downstream user raw material inventory will remain low. octanol needs to be able to support its high price operation, and industry fundamentals will continue to be strong. octanol prices and profits will continue to be strong Uplink space Liu Wenluan said.
Resource constraints
Due to weak downstream demand for octanol, there is no profit advantage in the propylene industry chain, and investment risks are high. Therefore, few enterprises are willing to invest in the construction of octanol plants. The production of octanol requires the participation of synthetic gas, which in turn limits the idea of enterprises building octanol plants, so in recent years, the new production capacity of octanol has been limited.
The existing octanol plants all co produce butanol, which has the potential to convert butanol to octanol. However, due to the conversion of butanol to octanol, it is necessary to incorporate the condensation unit on the basis of maintaining the original production chain. The integration of the system takes about a week, which not only brings a one week production loss to the manufacturer, but also increases operational difficulties and marketing costs by changing process conditions. Therefore, the practice of increasing octanol production through device conversion is also limited.
The downstream of octanol is mainly concentrated in environmentally friendly plasticizers such as dioctyl terephthalate (DOTP). With the rise of environmentally friendly plasticizers, DOTP's new production capacity continues to expand, and the overall procurement quantity of octanol has steadily rebounded. Given the difficulty in increasing the supply of octanol, an increase in demand will be beneficial for the rise in octanol prices.
At the same time, the concentration of the octanol industry is relatively high, and the bargaining power is mainly concentrated in the hands of leading enterprises. The bidding sales model adopted by leading enterprises leads to severe fluctuations in product prices. On August 10th, the limited bidding of large octanol factories and the active participation of downstream factories led to an increase of 500-600 yuan in the transaction price of the octanol market on that day.
In addition, the strong operation of raw material propylene also played a certain supporting role in the upward trend of octanol prices. According to monitoring data from Business Society, as of August 23, the average reference price for domestic propylene prices was 6763.25 yuan, an increase of 305 yuan compared to July 19. Zhang Min, a propylene analyst at Longzhong Information, explained that the arrival of the traditional "Golden Nine" peak season may drive downstream and terminal demand, so propylene may continue to operate stronger, leading to an increase in octanol prices.
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