In 2024, the profit of mainstream acrylonitrile production processes in China showed a trend of rising and then falling. In the first half of the year, the profit was basically positive, but in the second half of the year, the profit rapidly declined. The estimated average profit for the whole year is around -250 yuan/ton, with a year-on-year increase of 54.9%. In addition, the average annual production cost of mainstream acrylonitrile processes in 2024 is around 9550 yuan/ton, a year-on-year decrease of 433 yuan/ton. The decrease in raw material costs is one factor contributing to the recovery of acrylonitrile production profits, but the main reason comes from the temporary reduction in supply, which stimulates the rise in acrylonitrile prices.
During the first half of the year, the production profit of acrylonitrile increased significantly, with the highest single ton profit in April and May approaching 1500 yuan/ton. During this period, domestic production significantly decreased, and the supply-demand relationship improved, thereby stimulating a sharp rise in acrylonitrile prices and increasing profits. In addition, the profit of acrylonitrile production also improved in December at the end of the year, mainly due to the long-term low load operation of the East China plant and the temporary supply tightening, which stimulated the price of acrylonitrile to rise again. The highest profit point of acrylonitrile within the year also occurred in the first half of the year, with an average of 849 yuan/ton in April. However, the profit rapidly declined in the second half of the year, and the lowest point of the year occurred in August, at -1159 yuan/ton.
In 2024, the fluctuation of acrylonitrile plants in China increased due to fault factors, which affected some planned maintenance times and led to a temporary supply tightening situation under the background of overcapacity. In April, the capacity utilization rate dropped significantly to around 62%, mainly due to unexpected parking and concentrated load reduction. June and July entered the traditional off-season for demand, but due to the significant increase in acrylonitrile prices in the early stage, profit recovery stimulated the gradual recovery of factory production, resulting in a significant increase in capacity utilization in June and July. The fluctuation of production capacity utilization rate in the second half of the year has slowed down, but due to planned maintenance, combined with fault reduction and parking situations, the overall industry operation is still at a low level, which stimulates the price and profit of acrylonitrile to rebound again.
In 2024, there will still be overcapacity in domestic acrylonitrile production capacity, but there will be no new production capacity during the year. The number of production enterprises will remain at 16, and the concentration will still be high. The proportion of CR4 will still reach around 58%. Therefore, fluctuations in the equipment of individual enterprises, especially changes in the equipment of large factories in East China, will still have a direct impact on acrylonitrile supply.
However, in 2025, a new cycle of concentrated production capacity will be ushered in. It is expected that there will be five sets of acrylonitrile production capacity plans totaling 1.31 million tons in China. At that time, the number of domestic acrylonitrile production enterprises will also increase to 20, and the industry concentration will further decrease. At the same time, the impact of individual device fluctuations on market trends will also weaken.
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