Out of stock for 2-3 years, BASF, Covestro and other big factories stop production and reduce production!
According to sources, the supply of the three top raw materials in Europe, including natural gas, coal and crude oil, has been shrinking, which has seriously affected power and production. EU sanctions and conflicts continue, Everbright Securities predicts that Europe may be out of stock for 2-3 years.
Natural gas: ”Beixi-1″ has been cut off indefinitely, resulting in a shortage of 1/5 electricity and 1/3 heat supply in the EU, affecting the production of enterprises.
Coal: High temperature impact, delays in European coal transportation, resulting in insufficient coal power supply. Coal power generation is the main source of electricity for Germany, a major European chemical country, which will cause a large number of factories in Germany to stagnate. In addition, hydropower generation in Europe has also fallen sharply.
Crude oil: European crude oil mainly comes from Russia and Ukraine. The Russian side said that all energy supplies were cut off, while the Uzbek side was busy with the war and the supply was greatly reduced.
According to data from the Nordic electricity market, the highest electricity price in European countries exceeded 600 euros in August, reaching a peak, up 500% year-on-year. The surge in production costs will cause European factories to reduce production and increase prices, which is undoubtedly a big challenge to the chemical market.
Giant production cut information:
▶BASF: has started buying ammonia instead of producing it to reduce gas consumption at its Ludwigshafen plant, 300,000 tons/year TDI capacity may also be affected.
▶Dunkirk Aluminium: The production has been reduced by 15%, and the production may be reduced by 22% in the future, mainly due to the shortage of electricity supply and high electricity prices in France.
▶Total Energy: shut down its French Feyzin 250,000 tons/year cracker for maintenance;
▶Covestro: factories in Germany may face the risk of closing chemical production facilities or even the entire factory;
▶Wanhua Chemical: The 350,000-ton/year MDI unit and the 250,000-ton/year TDI unit in Hungary have been shut down for maintenance since July this year;
▶Alcoa: The output of aluminum smelters in Norway will be cut by one-third.
Raw material price increase information:
▶▶Ube Kosan Co., Ltd.: From September 15th, the company’s PA6 resin price will be raised by 80 yen/ton (about RMB 3882/ton).
▶▶Trinseo: issued a price increase notice, saying that starting from October 3, the price of all grades of PMMA resin in North America will be increased by 0.12 US dollars / pound (about RMB 1834 / ton) if the current contract allows. .
▶▶DIC Co., Ltd.: The price of epoxy-based plasticizer (ESBO) will be raised from September 19. The specific increases are as follows:
▶ Oil tanker 35 yen/kg (about RMB 1700/ton);
▶ Canned and barreled 40 yen/kg (approximately RMB 1943/ton).
▶▶Denka Co., Ltd. announced an increase in the price of styrene monomer by 4 yen/kg (about RMB 194/ton)
▶ Domestic chemical industry develops steadily! Focus on these 20 products!
Europe is the world’s second largest chemical production base after China. Now that many chemical giants have begun to reduce production, we need to be alert to the risk of shortage of raw materials!
|
Product name |
Main distribution of European production capacity |
|
Formic acid |
BASF (200,000 tons, Qing Dynasty), Yizhuang (100,000 nights, Finn), BP (650,000 tons, UK) |
|
Ethyl acetate dry |
Celanese (305,000, Frankfurt, Germany), Wacker Chemicals (200,000. Burg Kingsen of Qing Dynasty) |
|
EVA |
Belgium (369,000 tons), France (235,000 tons), Germany (750,000 tons), Spain (85,000 tons), Italy (43,000 tons), BASF (640,000 stores, Ludwig, Germany & Antwerp, Belgium) , Dow (350,000 tons, Germany Marr) |
|
PA66 |
BASF (110,000 tons, Germany), Dow (60,000 tons, Germany), INVISTA (60,000 tons, Netherlands), Solvay (150,000 tons, France/Germany/Spain) |
|
MDI |
Cheng Sichuang (600,000 tons, Dexiang: 170,000 tons, Spain), Ba Duangguang (650,000 tons, Belgian Announcement), Shishuangtong (470,000 tons, Netherlands) Taoshi (190,000 tons, acting Circumference: 200,000 tons, Portugal), Wanhua Chemical (350,000 tons, hook Yuli) |
|
TDI |
BASF (300,000 tons, Germany), Covestro (300,000 tons, Dezhao), Wanhua Chemical (250,000 tons, Goyali) |
|
VA |
Diesel (07,500 tons, Portugal), Bath (6,000, Germany Lujingyanxi), Adisseo (5,000, French) |
|
VE |
DSM (30,000 tons, Switzerland), BASF (2. Ludwig) |
Longzhong information shows: in 2022, the global production capacity of European chemicals will account for more than 20%: octanol, phenol, acetone, TDI, MDI, propylene oxide, VA, VE, methionine, monoammonium phosphate, and silicone.
▶Vitamin: The global vitamin production enterprises are mainly concentrated in Europe and China. If European production capacity declines and vitamin demand turns to China, domestic vitamin production will usher in a boom.
▶Polyurethane: Europe’s MDI and TDI account for 1/4 of the global production capacity. The interruption of natural gas supply directly causes companies to lose or even reduce production. As of August 2022, the European MDI production capacity is 2.28 million tons/year, accounting for 23.3% of the world’s total. TDI The production capacity is about 850,000 tons per year, accounting for 24.3% of the global monthly.
All MDI and TDI production capacity is in the hands of internationally renowned companies such as BASF, Huntsman, Covestro, Dow, Wanhua-BorsodChem, etc. At present, the sharp rise in the price of natural gas and related downstream chemical raw materials will push up the manufacturing cost of MDI and TDI in Europe, and the domestic Juli Chemical Yantai Base, Gansu Yinguang, Liaoning Lianshi Chemical Industry, and Wanhua Fujian Base have also entered the suspension of production. Due to the maintenance status, the domestic normal driving capacity only accounts for less than 80%, and the global MDI and TDI prices may have a large room for growth.
▶Methionine: The production capacity of methionine in Europe accounts for nearly 30%, mainly concentrated in factories such as Evonik, Adisseo, Novus, and Sumitomo. In 2020, the market share of the top four production enterprises will reach 80%, the industry concentration is very high, and the overall operating rate is low. The main domestic producers are Adisseo, Xinhecheng and Ningxia Ziguang. At present, the production capacity of methionine under construction is mainly concentrated in China, and the pace of domestic substitution of methionine in my country is steadily advancing.
▶Propylene oxide: As of August 2022, our country is the world’s largest producer of propylene oxide, accounting for about 30% of the production capacity, while the production capacity of propylene oxide in Europe accounts for about 25%. If the subsequent production reduction or suspension of propylene oxide occurs in European manufacturers, it will also significantly affect the import price of propylene oxide in my country, and it is expected to push up the overall price of propylene oxide in my country through imported products.
The above is the product situation involved in Europe. It is both an opportunity and a challenge!
Post time: Nov-11-2022