Epichlorohydrin: Larger variables in the market

Looking back at the epichlorohydrin market in 2007, the overall overjoyed was greater than the worry. Although the overall domestic market was worse than that in 2006, it was still better than the industry expectation. The highest market price was close to 20,000 yuan (t price, the same below). Looking into the domestic epichlorohydrin market in 2008, the overall situation is still severe, and the market still has a large number of variables.
In 2007, the domestic epichlorohydrin market changed roughly through the following stages: In January, the epichlorohydrin market price began to enter a downward channel, and the price at the beginning of the month remained at more than 19,000 yuan. By the end of the month, it dropped to about 17,000 yuan, a decrease of 2,000 yuan. Above RMB, the market performance was very sluggish; in February, affected by the Spring Festival holidays, the epichlorohydrin market did not stop its decline, and the price center continued to fall, and it fell to around RMB 16,000 at the end of the month; in early March, the epichlorohydrin market passed through a turning point. At the beginning of the month, the price fell below 15,000 yuan for the whole year, becoming the lowest point of the year. The mid-month market began to pick up, the price rebounded slightly, and it rose back to 16,000 yuan at the end of the month; Epichlorohydrin prices began to rise in April and climbed slightly to 16500 in July. 17,000 yuan; September epichlorohydrin prices began to rise, the price increase rate and speed are more alarming, to the end of October exceeded the 19,000 yuan mark, almost equal to 20,000 yuan integer mark, becoming a new high that year, really give the industry a Surprisingly, however, after the price stabilized for some time, it began to decline again at the end of the year, and by the end of December, the price of epichlorohydrin fell to 16,000 yuan nearby.
Analysis of the domestic epichlorohydrin market in 2008, the overall situation is still not optimistic, the market variables are still large.
Domestic supply is increasing, and market sales pressure will be reflected in price changes. In 2006, the domestic production capacity of epichlorohydrin was around 264,000 tons, and the output was about 102,000 tons. In 2007, the production capacity reached 469,000 tons, an increase of 77.7% over the previous year. According to relevant statistics, the domestic production of epichlorohydrin in 2008 will reach around 600,000 tons, an increase of 28%. The increase in production capacity and output will change the contradiction between supply and demand.
Downstream demand led to expansion of epichlorohydrin. In 2006, the apparent consumption of epichlorohydrin in China was around 260,000 tons. It is estimated that in 2007 it will be close to 400,000 tons, an increase of 53.8%. China's epichlorohydrin is mainly used for the production of epoxy resin and synthetic glycerin. Among them, epoxy resin is the most important consumer field. The products are mainly used to produce coatings, composite materials, electronic and electrical materials and adhesives. In recent years, China's epoxy resin has developed rapidly. In 2003, there were more than 170 domestic manufacturers with a total capacity of over 300,000 tons. In 2006, the capacity reached 450,000 tons. Due to the rapid development of domestic epoxy resins and the large amount of epichlorohydrin gaps, prices have continued to rise. In 2006, the price of 26,500 yuan was reached in the global supply shortage and the domestic phase-by-phase supply reduction. The highest level. The trend of tighter prices for epichlorohydrin has attracted the attention of domestic and foreign investors. Various regions have announced plans for the construction of devices.
The import and export situation has a greater impact on the epichlorohydrin market. From January to November of 2007, China imported a total of 70,000 tons of epichlorohydrin, a year-on-year decrease of 47.3%, and a total of 0.65 million tons of epichlorohydrin was exported, a substantial increase over the previous year. This is due to the better domestic market in 2006 and minimal export volume. However, with the cancellation of the export tax rebate for epichlorohydrin in 2007, the export market will be greatly affected in 2008, which has been reflected in the latter months of last year.
Due to the higher profits of the epichlorohydrin industry, the industry’s overall benefits are good, so it attracts investors from all sectors. However, with the entry of many new enterprises, the large-scale increase in production capacity will cause the original market order to be disrupted, and the industry will face a decline in overall efficiency, overcapacity and disorder in the market. Epichlorohydrin is likely to repeat the overcapacity, price declines, increased competition, and the industry reshuffle.

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