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SubjectAcrylic World Newsletter-Jan 2018
Published Date2017/12/29
Content
MARKET OVERVIEW  

In January 2018, MMA supply continues to be tightened and MMA producers announced US$30~50 pmt MMA prices hike regardless of customers’ resistance and relative weakness of MMA market demand for upcoming year-end holidays. Several MMA plants scheduled shut down during the period between January and February, for example, Evonik 100kpta MMA plant in Shanghai, China will shut down for 10 days from 30th January, Formosa Plastics Corp (FPC) 98kpta MMA plant in Mailiao, Taiwan will shut down from 12th January to 6th February, and Mitsui Chemicals 40kpta MMA plant in Sakai, Japan will shut down from 10th to 20th January. Meanwhile, it’s heard that Saudi Methacrylate SAMAC (JV between Mitsubishi Chemical and market newcomer SABIC) 250kpta MMA plant at Al Jubail, Saudi Arabia can’t fully operate till December and runs at low production rate. Thus, there is no bulk vessel to Asia till January. In USA and Europe, it’ heard that a major MMA plant suffered from the shortage of HCN supply and kept low production rate during December and January. In America, most MMA producers run well but the tight MMA supply didn’t release till Q1 2018. In addition, it’s heard that Sumitomo Chemical C4-MTBE process 90kpta MMA plant in Saudi Arabia will delay commission to January 2018. On the MMA feedstock prices, naphtha market appears healthy due to continuous robust demand for the petrochemical feedstock ahead of Lunar Chinese New Year holiday. Although naphtha prices stabled at US$570~600 pmt, acetone prices continued increasing to US$750~780 pmt. Methanol prices were slightly uptrend to US$360~370/mt and MTBE prices were slightly increasing to US$670~690/mt. The prices of Propylene stabled at US$950~990/mt. On the demand side, downstream transparent ABS remains healthy and polymethyl methacrylate (PMMA) demand from the genera-purpose (GP) and light guide panels (LGP) grade appears tight on the back of limited MMA supply. PMMA producers were under allocated basis and PMMA prices up substantially in Q4 2017. Artificial marble and cast sheet remain steady, but most of the producers complained that increment MMA cost is difficult to reflect to end user. MMA prices for 500 mt above isotank order were settled in the range of US$2,750 ~ $2,850 pmt CFR for January 2018 shipment. The outlook for February remains tight in spot availability persisted, on the back of global supply shortages and low inventory level, thus, the SAMAC supply situation is the key to decide the future MMA price trend.

NORTH ASIA
 
In North Asia, China MMA demand appears lull. Domestic MMA prices downtrend aggravated to CNY 19,500~20,500pmt DDP after new capacity Dongming Huayi Yuhuang 50kpta MMA plant and Shandong Yidali Chemical 50kpta MMA plant in Shandong on steam during November and December. MMA offtake became slow because most customers want to reduce stock before Chinese New Year. China business will be closed over 15-20 February for the Lunar New Year holiday. It’s heard that domestic MMA operating rates kept at around 80% on the back of an explosion occurred at a downstream plant in early December, which caused MMA up-steam producer on the sidelines and observe the situation further. In South Korea, domestic market demand remains healthy. Tight MMA supply caused MMA under allocation to regular customer. MMA prices were stable at KRW 2,950-3,000/kg DEL. In Japan, MMA supply tightened on the back of limited supply availability. MMA prices stabled in the range of JPY 250~260/kg delivered to regular customer, and to spot customer were at JPY 295~305/kg. In Taiwan, domestic market remains lacklustre and the tight MMA supply push the price increasing NT$1/kg. Prevailing MMA prices were         NT$76 ~ NT$78/kg DDP. In addition, Formosa Petrochemical Corp (FPC) 98kpta MMA plant at Mailiao will shut down its 98,000mt plant from 12th January to early February as upstream AN plant proceed to annual maintenance at same time.
In the meantime, the shoot-up of MMA prices would eventually lift up price of downstream polymethyl methacrylate. The downstream of general purpose (GP) polymethyl methacrylate (PMMA) announced US$50~100/mt increase in view of higher feedstock MMA costs. The spot polymethyl methacrylate (PMMA) prices were around US$2,750-$2,850/mt CFR.

SOUTH ASIA

MMA supply in South East Asia continued to be tight. Most cast sheet makers continued running at low operation owing to short of MMA supply and high MMA costs. Most customers slow down MMA offtake on the back of poor market demand and year-end holidays. In Indonesia, domestic market appears stable. In Vietnam, market demand appears bearish and some cast sheet makers complained the increment MMA costs result in margin squeeze and order reduction. In Thailand, domestic market demand shows stable. In India, domestic demand remains stronger because of tight MMA supply. MMA prices were negotiated at US$2,850~2,950/mt CIF.

On the acrylic sheet side, the cast sheet prices were range at US$3.3~3.4/kg CFR Asia.

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