According to the Commodity Market Analysis System of Shengyi Society, from August 30th to September 6th, the domestic butadiene market price increased from 12925 yuan/ton to 12937 yuan/ton, with a price increase of 0.1% during the period. This week, the overall butadiene market experienced narrow fluctuations, with market prices falling, but the overall magnitude was limited. Sinopec’s butadiene price remains stable at 13000 yuan/ton. During the week, some of the goods arrived at the port and some were exported to the northern region. At the same time, some of the goods were sold in the northern region, alleviating the problem of tight supply in the northern market. The downstream market demand has remained lukewarm, with limited support for market sentiment, resulting in a general decrease in market prices this week. As of September 6th, the self pickup price of butadiene from the tank in East China is between 12550-12600 yuan/ton, a decrease of 100-150 yuan/ton compared to last week.

Cost aspect: During this cycle, the crude oil market has declined, partly due to the easing of tensions in the Middle East. Libya announced that it is expected to resolve restrictions on crude oil exports, easing the tight supply of crude oil and causing a significant drop in international oil prices. On the other hand, there are concerns that China’s crude oil demand may not meet expectations, coupled with the end of the peak oil season in the United States, which will drag down the crude oil market. As of September 5th, the settlement price of the main contract for WTI crude oil futures in the United States was $69.15 per barrel. The settlement price of the main Brent crude oil futures contract is $72.69 per barrel.

Supply side: The comprehensive operating rate in China has not changed much recently, and it has remained stable with a slight decrease this week. Currently, the domestic supply of butadiene has limited changes.

Demand side: The downstream synthetic rubber market has slightly rebounded this week, with a narrow range of market fluctuations. Currently, downstream demand is weak, market trading is flat, supply prices are firm, and merchant offers have slightly consolidated.

On Thursday (September 5th), the closing price of butadiene in the foreign market was mixed: among them, the FOB price in South Korea was reported at 1450-1460 US dollars/ton, unchanged; China’s CFR report ranges from $1490-1500 per ton, with an increase of $15 per ton; European butadiene FOB Rotterdam closed at 1110-1120 US dollars/ton, unchanged; FD Northwest Europe closed at 1050-1060 euros/ton, down 35 euros/ton.

Market forecast: With an increase in incoming goods, the current tight supply situation in the market has been alleviated to some extent. However, the downstream market has remained stable and weak. Although enterprise profits have been somewhat restored after price increases, overall demand is still biased towards rigid demand, and on-demand replenishment is maintained as the main strategy. Overall, it is expected that the butadiene market will experience a weak and volatile trend in the short term under the pattern of weak supply and rigid demand.

In August 2024, the domestic liquid ammonia market fluctuated and rose, with a strong upward trend, continuing the upward trend in July. At the end of the month, there was a brief decline, and the market showed signs of peaking and stabilizing. According to the Commodity Market Analysis System of Shengyi Society, liquid ammonia recorded a growth rate of 10.08% in August. As of the end of the month, the mainstream quotation for liquid ammonia in Shandong is in the range of 2450-2600 yuan/ton.

In the first week of the month, liquid ammonia continued its upward trend from July. The main reason is the tight supply performance in the main production areas of the north, which supports the upward trend of prices. In the northern region, equipment maintenance is relatively concentrated, and in some areas, supply is affected by rainy season weather, resulting in a shortage of supply. As a result, manufacturers have low inventory. In addition, downstream procurement has also recovered, and the ammonia market has significantly rebounded. Manufacturers have raised their prices multiple times, with a cumulative increase of over 300 yuan/ton in the first ten days. Distributors’ offers naturally skyrocketed.

From the second week to mid August, the market experienced a consolidation situation, with prices fluctuating around 2400 yuan. The main reason for the significant changes in the production of urea plants is that there are more conversions of liquid ammonia in the north, especially in Shandong, Hebei and other places, which has led to an upward trend in ammonia production and dragged down the continued rise of liquid ammonia. In addition, manufacturers in Central and East China have also slightly reduced their prices for shipments. The market has shifted from a tight supply to a basic balance between supply and demand.

In the latter half of the year, liquid ammonia surged again, and the overall operating rate of domestic manufacturers significantly declined, especially in the northern main production areas where ammonia discharge decreased by nearly 10% compared to mid month. Multiple sets of equipment in the northern region have malfunctioned or entered seasonal maintenance, resulting in a tight market for ammonia. In addition, multiple sets of equipment have also been repaired in Henan and Anhui provinces. Production enterprises generally experience a shortage of supply and demand for shipments. The ex factory price of liquid ammonia has naturally increased several times. Shandong manufacturers have generally raised prices 2-3 times within the week, with a cumulative increase of over 200 yuan/ton. As of the end of the month, the price of liquid ammonia has slightly stabilized, and downstream purchasing resistance is gradually strengthening, resulting in a slight correction in ammonia prices.

Future forecast

Business analysts believe that from a supply side perspective, the tight market supply has eased with the commencement of some facilities, and the price correction at the end of the month is also based on this. It is expected that the supply will gradually stabilize in the later stage.

From the demand side, there is still some support for agricultural demand, autumn fertilizer preparation is not yet over, and industrial demand remains mainly rigid. From a cost perspective, especially for coal ammonia enterprises, they may still be impacted by the weakness of coal, but the reduction of cost pressure will also provide more profit margins for enterprises.

Taking all factors into consideration, the price of liquid ammonia will gradually stabilize in the near future. In the short term, due to the increase in supply caused by the recovery of equipment, there is room for further price decline. However, considering that demand remains rigid, the possibility of a significant drop in ammonia prices is unlikely.

In August, the domestic phenol market continued to rise, especially in the second half of the month when domestic supply was limited and traders faced little supply pressure, resulting in an increase in phenol market prices. According to monitoring data from Shengyi Society, the market offer on August 1st was 8475 yuan/ton, and on August 31st it was 8732.5 yuan/ton, an increase of 3.04%. Compared with the price of 7525 yuan/ton at the beginning of the year, the increase was 16.05%.

At the beginning of the month, there was not much replenishment of domestic trade and nearshore cargo, and the port inventory was less than 5000 tons. However, the terminal replenishment sentiment was average, mainly digesting inventory or contracts. Under the pressure of shipment, the market slightly declined. In the latter half of the year, considering the export shipping schedule, some factories restricted their deliveries during the same period, overall inventory was low, and favorable news such as downstream bidding had an impact. As a result, the market center of gravity began to rise, and the annual new highs continued to be refreshed, with terminal demand for replenishment.

In terms of port inventory, it has remained at a low level of 3000-1000 tons, and the tight supply at the port supports the market.

Sinopec’s price for phenol in East China is set at 8700 yuan/ton, and the increase in Sinopec’s price is beneficial for market support.

Downstream bisphenol A is running smoothly, with mainstream negotiated prices in the East China region ranging from 9850-10000 yuan/ton. The mid to low price market is relatively active, and high-level transactions are average. Overall, market trading is limited. The high temperature season in the phenolic resin industry is in the off-season, while other industries mainly purchase for essential needs, making the overall situation relatively stable.

From the perspective of Shengyi Society, the phenol market was consolidating at a high level in September, and we will continue to pay attention to the port inventory situation. The frequency of domestic trade shipments to Jiangyin is relatively low, and the expected amount of port inventory is unlikely to increase significantly; Pay attention to the restart time of Longjiang Chemical and Blue Star Harbin facilities in terms of equipment within the month. From the perspective of demand, the peak off-season for phenolic resin has ended, and demand is expected to increase. However, considering that phenol is currently at a high level, September is still worth looking forward to.

According to the Commodity Market Analysis System of Shengyi Society, the domestic ethanol market was running weakly in August. From August 1st to 29th, the average price of domestic ethanol producers fell from 6012 yuan/ton to 5957 yuan/ton, with a price drop of 0.91% during the period and a year-on-year price drop of 12.55%.

In the first half of the month, the demand side continued to be sluggish, factory prices fell to stimulate shipments, downstream purchasing power was limited, and the ethanol market was weak. In mid month, the domestic ethanol market prices remained weak and stable, with demand continuing to decline. Factories saw a decrease in shipping prices, but downstream purchasing power was limited, resulting in relatively flat trading volumes. At the end of the month, the domestic ethanol market prices remained weak and stable, with raw material prices rising, putting pressure on the costs of ethanol production enterprises, increasing market supply, and demand side demand for fixed procurement. At the same time, there is a strong demand for fixed purchases on the demand side, and actual transactions are light.

In terms of cost, the domestic corn market prices are stable but relatively weak, and traders’ enthusiasm for shipment has increased, gradually accepting sales. However, downstream purchasing attitudes are cautious, maintaining on-demand procurement, and the market volume of goods is not large. There are few purchasing entities in the port, the arrival volume remains low, the demand for loading is not high, and traders are mainly slow to reduce inventory. The cost of ethanol is influenced by bearish factors.

On the supply side, there are significant differences in the operating rates of production enterprises in different regions. Negative factors affecting the ethanol supply side.

On the demand side, the off-season of Baijiu consumption continues and orders are postponed; The short-term anhydrous procurement of methyl ethyl ester remains stable; There is little fluctuation in the short-term production of ethyl acetate. Short term ethanol demand is influenced by bearish factors.

In the future market forecast, the negative impact of cost is expected, while the market supply remains abundant, resulting in overall shipping pressure. Ethanol analysts from Shengyi Society predict that domestic ethanol prices will remain stable with a weak trend in the short term.

The domestic fluorite prices continued to decline in August, with an average price of 3437.5 yuan/ton as of the end of the week, a decrease of 3.78% from the beginning of the month at 3572.5 yuan/ton, and a year-on-year increase of 9.13%.

Supply side: Limited mining operations and low fluorite inventory

The current situation of the game in the domestic fluorite industry still exists. Overall, the operating rate of enterprises has not changed much. Upstream mining is tight, backward mines will continue to be eliminated, and new mines will be added. Mineral investigation work is still difficult. In addition, national departments need to rectify fluorite mines, and fluorite mining enterprises are facing increasingly strict safety and environmental protection requirements. The rectification action is coming to an end in August, but the affected area has not narrowed. The difficulty of starting fluorite mines has increased, and the shortage of raw materials has limited the operation of fluorite enterprises. The supply of fluorite sources is still tight, and the inventory of fluorite enterprises is low. However, the import of fluorite from Mongolia has a significant impact on the northern fluorite market, and the trend of fluorite.

Demand side: Hydrofluoric acid demand, weak refrigerant, low operating level

The domestic hydrofluoric acid market experienced a downward trend in August, with mainstream prices ranging from 10300 to 10800 yuan/ton negotiated in various regions of China. The downstream hydrofluoric acid market is consolidating weakly, with some units still being shut down recently. There is little change in the spot supply of hydrofluoric acid, and manufacturers have low orders for purchasing hydrofluoric acid. The overall production of hydrofluoric acid is less than 60%, which has dragged down the domestic fluorite market. Some hydrofluoric acid manufacturers purchase on demand, and the domestic fluorite market is sluggish.

The downstream refrigerant market in the terminal continues to be deadlocked due to poor demand transmission. After entering the off-season of production, market production demand weakens. In addition, refrigerant companies have poor stocking conditions and are not actively purchasing upstream products. The market for some refrigerant products has declined, and as a result, the fluorite market is weak and difficult to change.

In addition to the traditional demand in the refrigerant industry, fluorite, as an important mineral raw material for modern industry, is constantly developing in emerging fields. It is also applied in strategic emerging industries such as new energy and new materials, as well as national defense, nuclear industry, etc., including lithium hexafluorophosphate, PVDF, graphite negative electrode, photovoltaic panel, etc. With the demand driven by new energy and semiconductor fields, fluorite applications have received certain support, and the fluorite market is still supported.

Market forecast: In the near future, it is difficult to improve the supply of domestic fluorite mines, and some mines have stopped production for safety inspections. The tight supply of fluorite mines is a major positive support for the fluorite market. However, the downstream hydrofluoric acid market trend has declined, and the demand for downstream refrigerants has weakened. In addition, imported fluorite sources have formed a certain impact on the market, and there are many negative factors. Chen Ling, an analyst at Business Society, believes that fluorite prices are weak and difficult to change in the short term.