"New Chess" has opened the chemical industry chain profit pattern

In 2015, for commodities, the word "miserable" is not. Black, color crying, the market has fallen to the "cabbage price". Chemicals are not immune to the commodities slump. In addition to PTA in the "hard shoulder", polyolefin "brother" and methanol have experienced almost "half" of the "torture".

Futures daily reporter statistics found that the chemical, PTA prices fell 24% from the year's high, the other three varieties are down more than 30%. Take two varieties with a large decline as an example, the high of polypropylene in the year is 9027 yuan/ton, the low is 5361 yuan/ton, a cumulative decline of 41%, and methanol from the high of 2654 yuan/ton fell to 1590 yuan/ton, a cumulative decline of 40.1%.

Looking back at the trend of 2015, Gao Jianming, an analyst at Hai Rong Investment, believes that chemicals basically reached their highs in late April and entered the downward channel in early May. Among them, the most spectacular belongs to the "olefin" brothers and methanol, their "tragic" reflected in the changes in the market.

PP as LLDPE's twin brother, under the pressure of loose supply, the fourth quarter of 2015 "squeeze profit market" deduce incisively and vividly. "In addition to their own oversupply reasons, and propylene monomer plummets to 3800 yuan/ton resulting in the collapse of the cost end, as well as the price difference between grain and powder is large, powder profit is good, large space for price reduction, PP grain price can not stand firm, the downstream demand to pull up little power." Gao Jianming said.

Compared with polyolefin, methanol price decline obviously lags behind. It can be said that the rise of methanol to olefin technology, methanol and olefin closely linked. "Most of the installations are outsourced methanol, increasing methanol demand on the one hand and alkene supply on the other. Methanol and olefin have an obvious linkage effect, but both the slump at the end of 2014 and the slump that began in July 2015 saw methanol prices fall behind olefin." Central Plains futures analyst CAI Yali said.

When it comes to the general decline of chemical products in 2015, the industry believes that such a trend is actually reasonable. "Coal started falling in 2012, down more than 60 percent, and crude oil started falling in the second half of 2014, also down more than 60 percent." As a source of coal and crude oil, falling prices have squeezed the costs of downstream chemicals, which have naturally followed suit, says Ms CAI. However, each chemical behaves differently in the process of falling prices.

After three consecutive years of decline in PTA from 2011 to 2014, the profits of the production link were squeezed, and there was no decline in 2015. The price fluctuated around the cost. The decline in olefin is due to the huge profit margin left by the collapse of the crude oil market in the second half of 2014.

It is understood that the average olefin profit of naphtha route in the first half of 2015 was 2,500 yuan/ton, and the price decline in the second half of 2015 was just the performance of olefin removing high profits in the period of capacity expansion. At present, the average profit of olefin production is 1500 yuan/ton.

"The olefin spread structure is near high far low, and far months at a high discount state, indicating that in the capacity expansion, funds are still short olefin profits." "Said CAI Yali.

In December 2015, 600,000-ton MTO unit of Shenhua Yulin was put into operation. In 2016, 600,000-ton alkene production capacity of China Coal Mengda, 1.2 million tons of Jiangsu Shenghong, 330,000 tons of Changzhou Fude, 300,000 tons of Bettel, 1 million tons of Salt Lake Group, 1.37 million tons of ZhongTianHechuang and 600,000-ton of Jiutai Energy will also be put into operation. "Capacity expansion is usually accompanied by profit contraction. In the middle and late stages of capacity expansion, prices fall back to around cost. So far month olefin prices still have room to fall." An industry insider thinks.