This week (7.24-28), domestic Adipic acid continued to rise moderately. According to the commodity market analysis system of the business community, as of July 28, the weekly increase of Adipic acid was 0.22%. The market trading center has risen by around 50-100 yuan/ton. At present, the market quotation range of Adipic acid is 9100-9300 yuan/ton. The main reason is that the cost side is favorable and the supply pressure is not significant.
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Industrial chain
The figure above shows that this week, the upstream products of the Adipic acid industry chain turned red, the upstream raw material end improved significantly, and pure benzene maintained a strong trend with a significant increase. The downstream main product PA66 continues to be weak, but under the effect of price transmission, there may be rebound demand in the later stage.
Cost side: Good raw materials and prominent cost effects
This week, crude oil maintained an upward trend, bringing a boost effect to the domestic petrochemical market. The price of pure benzene in China continues to rise. According to the Commodity Market Analysis System of Business Society, pure benzene rose 2.79% on the week. Compared to the previous week, the increase has increased. The main refinery’s quotation continues to increase, with a range of 200-300 yuan/ton. This week, the supply of the northern market was tight, and the supply of pure benzene flowing into East China was limited. The downstream procurement was active, and the market rose. Overlapping ports to continue the destocking mode, resulting in a market shortage of supply and demand; By the end of the week, the spot trading range in East China was 6600-7200 yuan/ton. The price of Cyclohexanone, another upstream product of Adipic acid, also showed an upward trend this week, but the increase slowed down. According to monitoring, the weekly increase was 0.33%, mainly due to the rapid price increase in the early stage (5.27% increase last week). In terms of cost, the recovery of upstream raw material market has boosted Adipic acid.
Supply side: The parking supply for enterprise equipment has been tightened
From the perspective of market supply: in terms of devices, the operating rate of Adipic acid continued to maintain a low position this week. About 70% at the beginning of the month dropped to 60% at present. This week, prices of major manufacturers continued to rise, and Adipic acid, a big factory in Shandong, increased by 200 yuan. The shutdown of Haili Equipment will continue until early next month, bringing positive effects to market supply. The decrease in supply is accompanied by an increase in manufacturers, which will boost the market. The improvement of supply is an important reason for the price of Adipic acid to recover. However, there has been little improvement on the demand side, and the upward trend has been suppressed.
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Demand side: demand side restricts the rebound of Adipic acid market
The downstream of Adipic acid is relatively depressed. Terminal procurement maintains a rigid demand. Taking PA66 as an example, this week’s price decline is the main trend. According to the Commodity Market Analysis System of the Business Society, PA66 fell by 2.48% this week. At the weekend, the market price of PA66 in Zhejiang is between 18000-18500 yuan/ton. The reason for the price rebound of Adipic acid is that the downstream enters the slack season of the industry, orders are reduced and demand is difficult to improve.
Future prospects
With regard to the future market, Adipic acid analysts from the business community believe that crude oil is still expected to rise in the later period, pure benzene is easy to rise but difficult to fall, and the current cost side is favorable or sustainable. However, from the supply side perspective, the resumption of work by Hai Li in early next month may bring impact to the market, and supply pressure may once again become prominent. The demand side just needs to continue to follow up. In general, Adipic acid will continue to maintain a moderate recovery trend, but the upward space will not be too large.
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