I. price trend
Adipic acid market trend chart
According to the data of the business club’s bulk list, in October, the domestic adipic acid continued the weak market in September, and the price fluctuated and fell, with the monthly rise and fall of – 4.23%. By the end of the month, the mainstream price was generally 8000-8200 yuan / ton.
II. Analysis and comment
| Polyglutamic acid |
This month, adipic acid market out of the shock down market, in view of the downturn in September, October adipic acid also inevitably fell. So far, the traditional peak season market of “golden nine silver ten” has been completely blown out. The three reasons of adipic acid market are loose supply, weak demand and loss of cost support. In October, the weak demand in the downstream of adipic acid and the steady increase of supply led to the increase of social inventory pressure. Therefore, enterprises have the willingness to reduce price and inventory, so the price fell again and again. In terms of region, the markets of East China and South China have declined, ranging from 200-500 yuan / ton. The market atmosphere is slightly bleak, dealers are mainly active in shipping, and the market maintains a weak and volatile pattern. At present, the downstream market has a heavy wait-and-see mentality, the transaction is slightly deadlocked, and there is room for businesses to save and transfer profits. In addition, the upstream cost side lost the key support, and pure benzene ended the booming market. In October, it turned down. According to the monitoring of the business agency, pure benzene fell by 6.12% in October, and adipic acid also fell (as shown in the figure below).
Trend chart of pure benzene Market
First of all, on the supply side, affected by the downturn of downstream purchase orders, the market supply only increased but not decreased, and many dealers said that the inventory pressure was large, the manufacturer’s equipment operating rate was high, the market inventory and the manufacturer’s inventory were increased, the market had staged stock up behavior at the end of September, and now the downstream procurement is still rational, affected by this, the delivery slowed down slightly in the middle and late October. Among them, there are also relatively low-cost sources flooding the market. There is a certain bargaining space for products, and the price difference between the market price offer and the firm offer remains. Dealers in North China, East China and South China adjust their quotations to varying degrees, and most regions maintain a stable market. Excessive supply pressure is an important reason why the price of adipic acid did not keep falling.
PA66 market trend chart
| Gamma Polyglutamic Acid |
In terms of demand, the downstream procurement has not improved significantly. The traditional “silver ten” market did not arrive on schedule this year, and the downstream operating rate is still slightly insufficient. The operating rate is basically above 50%, which does not form a strong boost to the upstream adipic acid. According to the monitoring of the business society, the downstream PA66 of adipic acid has continued to decline since September, although the decline in October is only 0.65%, but in combination with the two months of September and October. As a matter of fact, the decline is as high as 6%. The downturn in the downstream market (as shown in the figure above) is the decisive factor for adipic acid to get out of the predicament.
III. future forecast
According to adipic acid analyst of business and chemical branch, adipic acid is still sluggish and not getting better in the near future. At the same time, the whole chemical industry is also in a downward cycle. According to the Statistics Bureau, PPI fell 1.2% year on year in September, and the industry’s negative also covers the adipic acid industry chain. In addition, the lack of downstream demand is still the decisive factor for adipic acid to get out of the haze. Adipic acid is expected to be difficult to get out of the haze in the short term.
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