Since August, China's aggregate MDI market has changed sharply. As of August 20, the ex warehouse price of barreled products from Shanghai in East China was about 17600 yuan, down 2700 yuan (ton price, the same below) from the beginning of the month, down nearly 13%.

Industry analysts believe that at present, the contradiction between supply and demand is prominent, coupled with the impact of low import prices, the aggregate MDI market still has room to fall.

Import source shock

Li Hong, marketing manager of Shandong Zhonghai Chemical Group Co., Ltd., said that the main reason for the sharp drop in the price of aggregate MDI was the concentration of low-cost imports to the market in the near future. According to the cost analysis, the CIF Cost of imported Korean goods is about 17700 yuan. As a result, market participants generally expect that in this round of decline, the support position of Shanghai's supply of goods is 18000 yuan, but the market fails to stabilize at this price. Shippers are generally faced with shipping pressure, and even have the phenomenon of goods rejection, which is not negligible for the future market.

According to a salesperson, traders are optimistic about this year's market and store up goods in advance to welcome the peak season, but the reality is far worse than expected. Low price sales make the market under pressure.

According to the operation of the device, the 600000t / a inspection and repair device of Wanhua Yantai was restarted at the end of July; the 80000t / a equipment of East Cao Ruian was put in a month of shutdown and maintenance on July 23, and will be started soon.

"The market continues to be pressured by the expectation of a restart of the service unit. Although the factory has a limited number of policies to support the market, but the role is weakening, and is gradually suppressed by the negative, the short-term market reversal is unlikely. " Li Hong said.

Weak raw materials are hard to change

From the perspective of raw materials, the domestic aniline market continued to be stable, and the factory quotation and market price did not change much.

"The focus of raw material pure benzene continued to be explored. Last week, the price was adjusted twice, with a total increase of 250 yuan. The cost side is strong, which once again reduces the profit space of aniline. " Li Hong said.

According to the start-up of aniline production plant, Jinmao of Shandong Province was overhauled on August 5 for about 15 days; Tianji of Shanxi Province was shut down for one day due to the failure of the plant.

Li Hong said that at present, the inventory pressure of aniline manufacturers is not large, but there is sufficient stock in the field. Affected by environmental factors, the downstream plants have low operating rate, limited demand for aniline, poor enthusiasm of customers to receive orders, and limited support for aniline Market. In the later stage, based on the cost pressure, it is expected that the domestic aniline market price may be expected to increase, but due to the small range, the pulling effect on the polymerization MDI market is very small.

Low downstream demand

Polymdi is mainly used in the production of polyurethane rigid foam, semi rigid foam, etc., widely used in refrigerator, thermal insulation materials, automobile and construction industries.

From the perspective of the automobile industry, according to the statistics of China Automobile Circulation Association, the inventory early warning index of China's automobile dealers in July 2018 was 53.9%. According to relevant principles, 50% is taken as the boom and bust line and less than 50% is the reasonable range; the higher the inventory early warning index is, the lower the market demand is, and the greater the inventory pressure is. However, in July, China's auto inventory exceeded the warning line, reflecting the weak demand for raw materials in the auto industry in the short term. Therefore, as an important raw material of MDI, it is reasonable that the demand has not been large.

In addition, the strict environmental protection inspection is still carried out nationwide, and the operating rate of downstream spraying and pipeline insulation enterprises is generally low, which makes it difficult to release the terminal demand and cannot support the polymerization MDI market.

The overall situation of the refrigerator industry is not satisfactory. According to industry online statistics, the total refrigerator sales in 2018 was 37.934 million units, down 2.7% year on year. Among them, the domestic sales volume was 22.29 million, down 3.7% year on year.

To sum up, aggregate MDI terminal demand has not really started yet, in addition to the impact of low price of imported goods, the mentality of the goods holders is not stable, the strength of the production plant to support the market is not strong, and the market is in the process of continuing to explore the bottom.