Caprolactam: market summary in the first quarter

Market analysis in the first quarter

In the first quarter, the domestic caprolactam market price fluctuated. In January, the domestic caprolactam market price first rose and then fell. At the beginning of this month, Baling Petrochemical Plant unexpectedly reduced its load and production. In addition, Luxi phase II plant was not restored, the on-site supply was reduced, the downstream polymerization started reasonably, there was still some demand for goods, and the spot price of caprolactam increased slightly. However, as the terminals began to have holidays one after another, the sales of conventional spinning chips in polymerization plants weakened, the enthusiasm for raw material procurement weakened, and the listing price of Sinopec pure benzene decreased, the caprolactam spot market was under pressure, and the spot price fell slightly.

In February, the domestic caprolactam market price rebounded slightly and fell sharply. At the beginning of this month, Sinopec raised the listing price of pure benzene by 400 yuan / ton, and then Sinopec raised the listing price of caprolactam by 300 yuan. The bullish mood in the market was high, but the downstream market followed up slowly, the market trading atmosphere was general, and the spot price of Caprolactam rose slightly with the boost of cost. Subsequently, the enthusiasm for purchasing raw materials of downstream polymerization plants weakened, and replenishment was mainly needed at low prices. The trading atmosphere of caprolactam market was poor, and the pressure on the long short game caprolactam spot market fell sharply.

In March, the domestic caprolactam market price rose and fell rapidly. At the beginning of the month, with the load reduction of caprolactam plant units, the on-site supply decreased, and the supply side formed support. In addition, the recent market was strongly supported by the cost side, and the crude oil price soared to the range of 125-130 dollars. Sinopec raised the listing price for three consecutive times on the 4th, 7th and 9th, accumulating 700 yuan / ton. The cost pressure of caprolactam doubled, the listing price of caprolactam manufacturers also increased significantly, and the spot market boosted and rose. However, as crude oil and pure benzene prices fell broadly, cost support collapsed, and the caprolactam market fell. In addition, due to the impact of the epidemic, the transportation is blocked, the downstream procurement atmosphere is weakened, the demand side is empty, the on-site mentality is empty, the market merchants reduce prices, and the center of gravity of the offer moves down significantly.

Future forecast

Supply forecast: the 100000 t / a units of Shijiazhuang refining and chemical and the 100000 t / a units of Qinghua in Inner Mongolia are planned to be restarted in April, and other units are planned to be overhauled in April. The overall supply decreased in April.

Demand forecast: about 70% of PA6 polymerization plant is started, but the transportation is limited, so the procurement is more cautious.

Cost forecast: the international crude oil price may bring benefits to the market, and the supply of pure benzene in the site may continue to decrease. However, due to the storage and shutdown plan of some downstream styrene units, the demand for pure benzene may decrease. It is expected that the pure benzene market will be weak and volatile in the short term, and its resistance to decline is strong.

Overall: in the first quarter, caprolactam manufacturers suffered serious losses, the manufacturers reduced production and reduced burden, the cost and supply side were still supported, and the manufacturers were strongly willing to support the price. However, it is difficult for logistics and demand to significantly change the market constraints for a while, and the downstream procurement mentality is cautious. The market rebounded after waiting for the lifting of transportation sealing control. It is expected that the caprolactam market may be slightly sorted out in the short term. It is suggested to pay attention to the downstream trading, cost and on-site device dynamics.