Butadiene: the large release of production capacity leads the price drop

In 2021, the butadiene market fluctuated more and more, and the price rose sharply from about 8,200 yuan (ton price, the same below) at the beginning of the year to a high of 14,000 yuan, and then the market began to decline, ending at 4,650 yuan at the end of the year.

Market price trend of butadiene in 2021 (unit: yuan/ton)

Overall market ups and downs

According to Wang Chunyan, an analyst at Longzhong Information, the butadiene market trend in 2021 will show an inverted "V" shape

In the first half of the year, the butadiene market fluctuated sharply, with an amplitude of 47.

Under the combined effect of increased exports, decreased imports, and delayed production of new production capacity, the pressure of high domestic inventories has been significantly eased, the butadiene market has continued to rise, and the price has reached more than 9,500 yuan

This upward momentum continued until mid-July, when butadiene prices ran to the highest point of the year and hit a 3-year high

Production capacity continues to be released significantly

Entering the new year, the expansion of the butadiene industry has not stopped

It is understood that the second phase of Zhenhai Refining and Chemical in the first quarter, Shenghong Refinery, Lianyungang Shihe, Shandong Jinhai Chemical and other new butadiene plants will be put into operation in the second quarter; The diene plant is planned to be put into operation, and the cumulative production capacity will reach 900,000 tons/year

　　From the perspective of the first quarter, the 160,000-ton/year butadiene plant of Zhenhai Refinery Phase II was put into operation in early January, and the 127,000-ton/year butadiene plant of Sinochem Quanzhou Petrochemical was scheduled to be overhauled and restarted in mid-to-late January.

　　In addition, there are not many domestic butadiene plants planned to be overhauled in 2022, so it is difficult to find periodic benefits, and the overall market supply is becoming more and more sufficient, or the contradiction between supply and demand is aggravated

　　With the downturn in the market, it is difficult for butadiene profit space to increase significantly

　　"In 2022, in the context of a substantial increase in supply, the profitability of the butadiene industry is hard to be optimistic, and the overall profit margin may be lower than that in 2021.

　　Unbelievable performance this year

　　In the synthetic rubber industry with the largest downstream of butadiene, styrene-butadiene rubber and butadiene rubber account for more than 50% of the downstream consumption of butadiene

　　It is understood that the number of butadiene downstream projects planned to be put into production in 2021 was originally acceptable, especially the number of nitrile latex planned production plants with large production capacity, but due to the relatively limited actual market demand, some new production capacity could not be realized as scheduled

　　In 2022, there is no expected new production capacity of domestic emulsion polystyrene-butadiene rubber; in terms of cis-butadiene rubber, Zhejiang Petrochemical's 100,000 tons/year new production capacity is expected to be released; ABS will also release new production capacity in the second half of the year, but the overall contradiction between supply and demand is still difficult to reconcile

　　From the perspective of profit, the price of butadiene will decline in 2021, and the profit of the industrial chain will be transferred to the downstream rubber industry.

　　Xie Zhenxing, an analyst at Jinlianchuang, said that with the improvement of the profits of the rubber industry, the operating rate of styrene-butadiene rubber and butadiene rubber enterprises will increase, the market pressure will increase, the price will hardly increase significantly, and the profit margin will be narrowed