I. price trend

In October 2019, the butadiene market fell sharply, and the price curve was like a “slide” business agency monitoring. At the beginning of the month, the price of butadiene was 11581 yuan / ton, and at the end of the month, the price of butadiene was 9345 yuan / ton, down 19.30% in the month, down 8.04% compared with the same period last year.

II. Analysis of influencing factors

Product: in October, the domestic butadiene market fell sharply. Before the festival and during the National Day holiday, the Northeast manufacturers actively exported to ease the holiday inventory pressure, and some manufacturers continued to ship during the National Day holiday. Under the supply pressure of the northern market, the market gradually weakened. After the festival, the market bearish atmosphere is obvious, in addition to the weak external market, a large number of ocean shipping prices are low, dragging the market into the downward channel. Although it is necessary to replenish the position at the low price node and digest part of the spot inventory in the middle and late period, it is difficult to open a significant price difference in the north and South markets. The spot supply is abundant in the north region, and the downstream bearish expectation leads to the low inquiry. Meanwhile, the low price news of the far month cargo affects the bearish expectation of the merchants on the future market, and the downward trend of the market is hard to change. In terms of price, as of October 30, the delivery price of superior products in Shandong was 8500-8600 yuan / ton, down 2550 yuan / ton on a month on month basis; the price in East China was 9000 yuan / ton, down 3400 yuan / ton.

For enterprises: Sinopec East China butadiene supply price dropped by 2600 yuan / ton to 9900 yuan / ton in total; by the end of the month, the base price of North Huajin butadiene was 8710 yuan / ton, and the total volume of domestic and foreign sales was 1118 tons due to the poor transaction of some nodes; by the end of the month, Fushun Petrochemical’s base price was 7900 yuan / ton, the transaction price was 7900-7950 yuan / ton, and the total volume of monthly sales was 2040 tons; Inner Mongolia Gujutai 70000 T / a unit was shut down for maintenance on October 14-20, and the listing price was 8200 yuan / T by the end of the month, with a drop of 3800 yuan / T on a month on month basis; shenhuaning coal butadiene unit was in stable operation, with a reference to 7560 yuan / T on a month on month basis, with a drop of 2840 yuan / T on a month on month basis; India haldiya Petrochemical’s 97000 T / a butadiene unit and Malaysia pengerang’s 180000 T / a butadiene unit in the month Set to restart one after another.

Industry: according to the price monitoring of the business agency, in October 2019, there were 20 kinds of commodities rising month on month in the list of commodity price rise and fall in the chemical industry sector, including 8 kinds of commodities rising by more than 5%, accounting for 9.5% of the number of commodities monitored in the sector; the top three commodities were hydrogen peroxide (25.36%), epichlorohydrin (25.33%) and sulfur (19.54%). There are 56 kinds of commodities falling on a month on month basis, 29 kinds of commodities falling by more than 5%, accounting for 34.5% of the number of commodities monitored in this sector; the top three products falling are nitric acid (- 30.41%), butadiene (- 19.30%) and acetic acid (- 18.84%). This month’s average rise and fall was – 2.82%.

III. future forecast

From the perspective of the future market, the positive aspects are: the rigid demand in the north and the lower reaches is still there; the pressure of profit has the expectation that the operation of the oxidation and dehydrogenation unit will decline; the profit of the lower reaches industry will slightly increase. On the negative side, the external market is weak; the downstream synthetic rubber market trend is difficult to support; in November, the ocean shipping supply is abundant; from December to January, there is no lack of low price news. In the near future, the supply of ocean going cargo is abundant, the external market is wide and falling, and there are many lower prices. In addition, the pressure of spot supply in the north is obvious, and it is difficult for the downstream to effectively alleviate the current supply pressure, so the short-term market is hard to find good support. On the one hand, the recent market pressure comes from the arrival supplement of imported ships. It is heard that Iran and some ocean going ships are expected to arrive at the port, and the price is relatively low on the spot. At the same time, some businesses began to pay attention to the production of new butadiene units of Dalian Hengli and Zhejiang Petrochemical in the later stage, and the inquiry intention for the far month ships is low, which continues to drag the market. Generally speaking, butadiene analysts of the business agency expect that although the domestic downstream rigid demand will temporarily support the spot market at the low price node, the market trend may continue to be weak as a whole. It is suggested to pay attention to the supply side news and the internal and external price guidance.