A large number of equipment maintenance & factory price increases, adipic acid bottoms out and stabilizes

According to the monitoring of business news agency, domestic adipic acid was still weak this week (August 12-19), but the market showed signs of bottoming out and stabilizing. The market rebounded slightly at the beginning of the week, and the price stabilized at the weekend. The weekly increase was 0.18%. At the weekend, the market price range of adipic acid was 8900-9300 yuan / ton. The cost is still negative, the crude oil is volatile, and the price of pure benzene continues to fall. On the supply and demand side, more factories released maintenance or load reduction news, and raised the listing price, which boosted market confidence.



From the perspective of market supply, the adipic acid operation rate is low this week, and it is currently maintained at below 4.5%. The pressure on manufacturers’ inventories has eased slightly and the supply expectation has narrowed, which is also the main reason for adipic acid to stop falling and stabilize in the week. At present, the profit of the manufacturer is inverted.


Trend of adipic acid industry chain


The above figure shows that the adipic acid industry chain is still relatively weak this week. The related upstream product pure benzene (- 5.6%) fell significantly, adipic acid remained weak, the trading focus was flat, and the manufacturer’s profit was inverted, maintaining a negative profit range. In addition, the downstream PA66 recovered after rebounding last week, but the terminal remained weak after a long-term decline.


Market trend of adipic acid upstream pure benzene


Market trend of cyclohexanone in adipic acid upstream


The support of upstream raw materials is insufficient, and the decline of pure benzene price this week is deepened. According to the monitoring of business agency, the decline of pure benzene this week is 5.6%. Sinopec East China, the main plant of pure benzene, has continued to reduce the price this week, with a cumulative range of 450 yuan / ton, following the decrease of 500 yuan last week. The inventory of pure benzene in East China decreased, and the overall supply of the spot market decreased. In addition, the inventory of East China port fell, and the spot quantity was small. The good supply side can not offset the bad demand brought by the slowdown. Cyclohexanone also decreased slightly, at – 0.6%. It shows that the upstream cost still forms a negative pressure on adipic acid.



Market trend of adipic acid downstream PA66


Terminal demand: the downstream performance of adipic acid is sluggish, and the downstream factories mainly purchase on demand. According to the monitoring of business agency, after the rebound of PA66 downstream of adipic acid last week, the price stabilized this week, and the market still showed weak demand. The weak downstream demand is the fundamental reason that restricts the rebound of adipic acid.


In the later stage, the Business Association believes that there may be rebound demand for crude oil in the later stage, but pure benzene will continue to fall, forming a negative effect on adipic acid. In the later stage, pure benzene is expected to bottom out, which may boost the confidence of the downstream to a certain extent. On the supply side, at present, the operating rate of domestic units continues to decline, which has dropped to below 45%, and the market supply pressure is expected to ease. Cost and supply will bring rebound demand for adipic acid. However, terminal consumption is still weak, and downstream factories purchase on demand, which will also exert pressure on the rebound of adipic acid.


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