The aggregated MDI market has many variables

　　Since the beginning of this year, the market of polymerized diphenylmethane diisocyanate (MDI) has continued to decline
.
As of June 8, the negotiated price of Shanghai goods was 16,700-16,800 yuan (ton price, the same below), and the negotiated price of Wanhua goods was 17,000 yuan, down more than 3,000 yuan from the beginning of the year
.

　　Regarding the market outlook, some market participants believe that the production capacity of polymerized MDI is sufficient and the demand has not yet started.
However, due to the temporary shutdown of overseas installations and the cost of aniline, the long and short positions of polymerized MDI are intertwined fiercely, and there are many variables.
The market volatility may become the main theme
.

　　Market supply is sufficient

　　In May, the aggregated MDI market still did not improve, and the bottom was not seen for a long time
.
As the epidemic is brought under control, the load of factories in Shanghai has gradually increased, logistics has been improved, traders are actively negotiating shipments, and many people have heard about low prices, which aggravates the pessimism of traders in the trade market
.

　　"The downturn in the aggregated MDI market is related to the substantial increase in China's production capacity in recent years
.
" Pan Jinsong, a professor-level senior engineer at the Shandong Institute of Industry and Information Technology, said that today, the domestic aggregated MDI production capacity is nearly 4 million tons per year
.
By the end of the year, the 400,000-ton/year plant of Wanhua Chemical's Fujian plant and the 300,000-ton/year plant of Wanhua Chemical's Ningxia Ningdong will be put into operation.
By then, China's polymer MDI production capacity will continue to expand, and the industry may face reshuffle
.

　　In terms of output, since the beginning of the year, the domestic output of aggregated MDI has reached 809,800 tons, an increase of only 2.
53% over the same period last year
.
During the epidemic, the MDI factory in Shanghai was also running, but the load was not high
.

　　With the increase in domestic production capacity, the external dependence of the aggregated MDI industry has continued to decline
.
According to customs statistics, from January to April, China imported 89,700 tons of aggregated MDI, a year-on-year decrease of 13.
25%
.

　　This year's export situation is also not satisfactory
.
From January to April, China exported 324,900 tons of aggregated MDI, a year-on-year decrease of 5.
55%
.

　　Regarding the market outlook, the operating rate of aggregated MDI enterprises in Shanghai still has room to increase, but the news of temporary suspension of MDI installations in the United States came out on the 9th, and the shipment of MDI in South Korea was also delayed, and the market may further consolidate
.

　　Profits keep shrinking

　　The raw material aniline has recently rebounded in the market
.
Up to now, the negotiated price of aniline in North China is 11,400 yuan, and the negotiated price of aniline in East China is 11,400 to 11,800 yuan, an increase of about 400 yuan from the beginning of June
.
The price of raw materials has risen, and the profits of the polymerized MDI industry have continued to shrink
.

　　According to Wang Quanping, chief engineer of Shandong Kenli Petrochemical Group, the upstream pure benzene market has been sorted out at a high level, which strongly supports the cost of aniline
.
The price of aniline remains high.
At present, the average cost per ton of product in the polymerized MDI factory is 14,500 yuan, and the average profit is about 2,720 yuan.
In April, the average profit per ton of product was more than 4,600 yuan
.

　　From the perspective of the aniline plant, although the 100,000 t/a plant in Nanhua was restarted and the Huatai plant in Dongying was temporarily shut down, there was no obvious impact on the spot market supply
.
When the price was low before, downstream and traders were actively bottom-hunting, and factories were clearly arranging warehouses.
At present, there is no overall pressure on inventory
.

　　In terms of aniline raw materials, the large-scale pure benzene units that have been overhauled in the early stage have been restarted one after another.
It is expected that the operating rate of domestic petroleum benzene and hydrogenated benzene enterprises will increase in June, and the external release of pure benzene will increase
.
However, many downstream units of pure benzene will be overhauled at the end of May and early June, and the demand for pure benzene is expected to continue to decrease
.
In addition, the long-term loss in the downstream makes it difficult to follow up on high-priced pure benzene, and the subsequent downstream operating rate is expected to continue to decline
.
However, since the outer market is still high and strong, and the bottom support of domestic pure benzene is strong, it is difficult to have a large room for correction
.

　　Market analysts believe that in addition to cost support in the aniline market, with the improvement of the domestic epidemic situation, downstream demand is gradually increasing, and the industry chain is well conducted.
The aniline market is expected to maintain a high-level consolidation pattern and provide cost support for polymerized MDI
.

　　Demand continues to slump

　　From the perspective of the downstream of polymerized MDI, the rigid foam polyurethane market is relatively weak, and it is difficult to have a strong support for the polymerized MDI market
.

　　At present, affected by the sluggish terminal demand, most of the rigid foam polyurethane manufacturers focus on promotion, and some of the focus of discussions has declined, but the transaction performance is still average
.
Downstream rigid demand orders are limited, the overall increase is still not obvious, and the industry is still not optimistic about the market outlook, and generally maintain a wait-and-see attitude
.

　　From the perspective of major downstream industries, the automobile and refrigerator markets have not seen any improvement
.
According to data from the National Bureau of Statistics, from January to April this year, the output of China's automobile and refrigerator products both declined year-on-year
.
In particular, the refrigerator market did not perform well, and one of the main reasons was that exports were blocked
.
After the epidemic was lifted abroad, the productivity of refrigerator factories was gradually restored, so the export dividend of domestic refrigerators disappeared
.
In addition, the lack of domestic demand has made the production and sales of refrigerators "worse"
.
Data in April showed that the national refrigerator output was 6.
524 million units, a year-on-year decrease of 15.
8%
.

　　Although it is currently the traditional peak season for downstream adhesives, it accounts for a small proportion of downstream consumption of polymerized MDI and has limited impact on the market
.

　　On the whole, the fundamental performance of the rigid foam polyurethane market is still weak, and factories continue to exist based on sales
.
Although the East China coastal areas continue to resume work and production, the logistics circulation has accelerated, and the demand side has gradually recovered
.
However, it will take time for this benefit to be transmitted to the raw materials.
Besides, many industries and enterprises are under great financial pressure, and their consumption power is waiting to increase.
It is expected that the short-term rigid foam polyurethane market will still run weakly, and it is difficult to support the raw material polymerization MDI market to continue to strengthen
.