Since the beginning of this year, the acetonitrile market has been falling continuously, and the price has been running below the line of 10,000 yuan (ton price, the same below), and there is no sign of stabilizing and rising. Looking at the market outlook, excess supply will continue to clamp down on the market, coupled with mediocre demand, the acetonitrile market has insufficient momentum to go long, or it may continue to grind at the bottom.
The market is under pressure for capacity release
In 2023, the performance of the acetonitrile market is bleak, and the market continues to decline. In the first quarter, the price of the mainstream market even fell by 20%. Wang Liyuan, an analyst at Longzhong Information, said that compared with the acetonitrile market in the past two years, the price of acetonitrile this year is far lower than that of the same period in previous years, with a gap of more than 10,000 yuan.
Although the decline in the current acetonitrile market has slowed down, there is no sign of improvement, and the price has been hovering around 9,600 yuan.
The fundamental reason is that the acetonitrile market continues to be under pressure due to the substantial release of production capacity. This year, both the domestic by-product method and the synthetic method of acetonitrile have new production capacity put into operation. Two sets of by-product devices in CNOOC Fudao and Jihua Jieyang were put into operation in February, and the products began to be gradually exported in late March. In addition, Henan Longyu's new synthetic acetonitrile plant has been put into operation at the end of 2023. At present, the total production capacity of acetonitrile in China has increased by 9.9% year-on-year.
The market pressure has also led to a low operating rate of the industry. At present, the average operating rate of by-product acetonitrile enterprises is about 68.33%. At the same time, due to the shutdown of the Lihuayi plant for maintenance and the shutdown of a production line of Jilin Petrochemical, the capacity utilization rate of the synthesis plant has gradually dropped from more than 60% to around 50%.
Looking at the market outlook, it is difficult to find good news in the acetonitrile market, and under the cloud of overcapacity, it is difficult for the market to improve significantly. Although the operating rate of acetonitrile by the by-product method is expected to continue to decline, the market supply is still sufficient, and it is difficult to form effective support for the market.
Cost inversion loss continues
Compared to the "highlight" moment of profit in previous years, this year's acetonitrile market can be described as "dismal". After entering the first quarter of 2023, the production profits of synthetic acetonitrile enterprises gradually dropped to negative values and fell into a state of loss.
According to the statistical data, the profitability of synthetic acetonitrile is not optimistic. In the first quarter, the loss of acetonitrile per ton was nearly 180 yuan, a decrease of 1076 yuan from the previous quarter, and a year-on-year decrease of 5923 yuan. At present, the loss space has expanded to around 700 yuan.
Jin Lianchuang analyst Zhang Qiang said that the profit margin of synthetic acetonitrile has narrowed because the raw material acetic acid market is relatively strong. Although the overall supply of acetic acid has increased this year, the cost side has declined, the demand is acceptable, and the price of glacial acetic acid is relatively firm. Looking at the market outlook, this situation may continue, and it is unlikely that the price of acetic acid will drop sharply.
In addition, the market for synthetic ammonia, another raw material, has been falling continuously, but because its cost ratio is not as high as that of acetic acid, overall, the cost of synthetic acetonitrile remains high, which continues to erode the profits of acetonitrile.
Industry insiders said that the concentrated release of new production capacity of the synthetic method in the past two years is also an important factor causing the cost inversion of synthetic method enterprises. The data shows that the total production capacity of the synthetic method has reached 46% in the past two years, including Shandong Kunda, Anhui Baihaosheng, and Henan Longyu, which have already put into production, as well as Fushun Youlian, Ningxia Zhonghui and other companies that plan to put into production next .
Judging from the overall start-up of by-product enterprises, although the acrylonitrile industry has overcapacity, its output is still growing slowly. The overall supply of acetonitrile as a by-product will remain saturated for a long time, and the market does not have the conditions for a rebound.
Jilin Petrochemical salesperson He Junsong said that competition in the acetonitrile industry is intensifying. Previously, the market was able to achieve a relatively large price increase with the help of phased shutdowns or limited production of by-product devices, but the current reduction of by-product companies has already It can be completely supplemented by synthetic products, so it is difficult to extinguish the price war, and the cost inversion may continue.
Weak domestic demand and weak external demand
Acetonitrile is a widely used organic chemical raw material. It is used as a synthetic raw material for fine chemicals such as organic synthesis, medicine, pesticides, surfactants, and dyes.
He Junsong believes that while the supply of acetonitrile has increased, the downstream demand has not increased synchronously, which has also caused the market to continue to operate at a trough.
Pesticides are the main downstream industry of acetonitrile. The pesticide market started relatively late this year and gradually recovered until mid-March, but the terminal remained in a sluggish situation; technical intermediate factories also resumed normal production in late March. Therefore, the overall performance needs to be weak for most of the first quarter. Not only in the first quarter, but since April, the pesticide market has remained flat, the demand for technical chemicals is insufficient, and the plant has started to operate at a low level.
Insufficient domestic demand, external demand is also sluggish, which can be confirmed from the export of acetonitrile. Market participants said that since 2023, the foreign trade situation has been poor, and the export volume of acetonitrile has also shrunk in stages, especially the sharp decrease in spot export orders. On the one hand, this is due to insufficient demand due to the poor economic situation overseas; on the other hand, the local supply of acetonitrile in India, the main consumer, has also increased since 2023, so the overall overseas demand is also weak, with only sporadic small orders following up.
To sum up, the demand for acetonitrile is sluggish both internally and externally, and raw materials are often purchased as needed, so it is difficult to support the strengthening of the acetonitrile market. (Zhao Shuling)
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