Industry News
The PVC powder industry is expected to increase production in September due to an increase in construction
Since September, the operating load rate of the PVC industry has gradually increased. As of the week ending September 14th, the operating load rate of the PVC industry has returned to 76.91%, the highest operating load rate since early April this year. The increase in the industry's operating load rate is mainly due to the recovery of industry profits and the end of centralized maintenance.
Industry gross profit gradually recovers, forced to reduce production, and enterprises gradually recover
In September, the overall profitability of chlor alkali enterprises continued to recover. Taking Shandong region as an example, according to the gross profit model, as of September 14th, the integrated gross profit of caustic soda/calcium carbide PVC in Shandong region was 543 yuan/ton, an increase of 129.11% compared to the end of August. The increase in profits is mainly supported by the surge in caustic soda and PVC.
Entering September, the price of liquid alkali continued to fluctuate and rise. On the one hand, some large enterprises still have maintenance expectations, and there are expectations of a decrease in supply. On the other hand, the overall performance of the downstream alumina and viscose fiber industries has slightly improved, bringing some positive boost to the liquid alkali market. As of September 15th, 32% alkali in Shandong was at 765-790 yuan/ton, an increase of 3.32% compared to the end of August.
In September, PVC prices first rose and then fell, and the price of East China SG-5 fluctuated at a relative high of 6260-6430 yuan/ton. The main reasons for supporting the upward movement of market prices are, on the one hand, the implementation of the real estate policy that exceeded expectations at the beginning of the month, the improvement of the macro atmosphere, the rise of commodities, and the follow-up of prices. On the other hand, although the fundamentals are average, in the context of high export backlog, the East and South China markets maintain destocking, and the overall pressure on the supply side is not significant.
Supported by the gradual recovery of profits, some enterprises that were forced to reduce or stop production in the early stages have gradually recovered.
Centralized maintenance ends and industry starts improving
With the gradual implementation of maintenance, most enterprises have completed one maintenance within the year. As of mid September, enterprises that have completed one maintenance account for about 82% of the total production capacity, while a few enterprises have already conducted two or more maintenance within the year. However, there is a significant reduction in maintenance not carried out. So with the significant reduction in routine maintenance. The industry's operating load rate has also increased.
In the second half of September, the number of maintenance companies reducing industry construction will continue to increase
With the gradual recovery of ethylene process units, Yinglite Type 3 units, Julong Chemical, Shandong Xinfa and other units in Salt Lake Magnesium Industry, the operating load rate is expected to slightly increase this week. However, there are still some maintenance losses for units above this week. In addition, Bohai Chemical Development and Gansu Jinchuan are still undergoing maintenance this week, and some units in Shaanxi Beiyuan are also undergoing temporary maintenance for 2-3 days. So it is expected that the increase in the industry's operating load rate will be limited this week. Next week, most of the enterprises above will return to normal, while Suzhou Huasu is the only new maintenance enterprise, so the operating load rate may increase to around 80% next week.
Overall, on the one hand, with the recovery of industry profits, enterprises that were forced to reduce production and stop production in the early stage have gradually recovered. On the other hand, centralized maintenance has gradually ended, and the industry's operating load rate has gradually recovered in September. It is expected that PVC production in September may be around 1.94 million tons.
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