Since February 24, the price of calcium carbide has soared rapidly from 3375 yuan / ton to 4600 yuan / ton on March 15, with an increase of 36.3%. In the same period, the price of calcium carbide in East China has also risen from 8570 yuan / ton to 9050 yuan / ton, with an increase of 5.6%.
Strong cost support
On February 24, Wulanchabu planned to limit its power supply in March, which caused the market's concern about the impact of calcium carbide supply. Wulanchabu's calcium carbide production capacity was 3.35 million tons, accounting for 9.4% of the total domestic production capacity, accounting for a relatively large proportion. On March 5, 2005, the efforts to limit production and power supply in Wumeng area of Inner Mongolia were intensified, and the output of calcium carbide was affected by more than 2700 tons / day. On March 9, the development and Reform Commission of the Inner Mongolia Autonomous Region, the Department of industry and information technology, and the Energy Bureau issued a notice on several guarantee measures to ensure the completion of the "14th five year plan" energy consumption double control target tasks, which mentioned accelerating the structural adjustment of high energy consumption industries, and no approval will be given from 2021 (2180, 21.00, 97%) (LAN tan), calcium carbide, PVC, Caustic Soda and other varieties of new capacity projects, on the one hand is the future long-term new capacity of PVC calcium carbide method is limited, on the other hand is the short-term power supply reduction of calcium carbide.
Decline of calcium carbide operation rate: load reduction and shutdown occurred in Wuhai and Ordos areas, and production of individual calcium carbide furnaces in Sichuan and Gansu was abnormal. Relevant data show that as of March 12, the average operating rate of calcium carbide dropped to 54.9%, and the higher point dropped by 5.6 percentage points. Before 2019, the change of calcium carbide load does not significantly affect the load of calcium carbide PVC; after 2019, the correlation between the operation rate of calcium carbide and the operation rate of calcium carbide PVC is significantly improved. At present, the operation rate of calcium carbide is obviously declining, and it is expected that the operation rate of subsequent calcium carbide PVC will also decline.
According to the current carbide production reduction conversion theory, the PVC impact magnitude: as of March 11, the output of carbide in Wumeng area was affected by the production restriction, and the daily loss was about 4200 tons. According to the conversion of 1 ton of PVC corresponding to 1.35 tons of carbide, the PVC production loss was about 93000 tons / month in theory. This week, Wuhai and Erdos regions also began to be strict, and the phenomenon of carbide furnace maintenance ahead of schedule or load reduction increased.
Inner Mongolia calcium carbide is mainly supplied to purchased PVC factories in Shandong, Hebei, Tianjin, Henan and Northeast China. By the end of last year, the PVC production capacity was close to 26 million tons / year, with ethylene process accounting for about 20%, calcium carbide process being the mainstream accounting for about 80%, and the purchased calcium carbide process PVC affected by take out calcium carbide accounted for 32%, accounting for a relatively large proportion. Among the regions that purchased PVC, central China and North China accounted for 47%.
In Northeast, Hebei, Tianjin, Henan and Shandong, the capacity of purchased calcium carbide PVC is about 3.2 million tons / year, accounting for 12.3% of the PVC capacity. We estimate that the upper limit of the impact of outsourcing calcium carbide method is 270000 tons / month, while the current limit of calcium carbide is about 90000 tons / month. Before further expansion of calcium carbide production, the market output reduction is estimated as 80000-120000 tons / month.
At present, the actual impact magnitude of PVC start-up: as of the week of March 12, the total PVC start-up rate was 85.1%, and the higher point decreased by 2.8%; the PVC calcium carbide start-up rate was 87.2%, and the higher point decreased by 2.1%.
The rising price of calcium carbide has a certain impact on the production cost of purchasing PVC by calcium carbide method. Last week, Shandong purchased calcium carbide single variety PVC gross profit and chlor alkali comprehensive gross profit have entered the cost line. The PVC production capacity of purchased calcium carbide accounts for 32% of the total capacity, so the high price of calcium carbide really supports the cost of PVC. Overall, the long-term PVC operating rate followed by marginal decline.
Exports continue to increase
In late February, the cold wave in the United States caused a decrease in PVC production in the United States. A total of 1.99 million tons of production capacity in the United States was affected this time, accounting for about 6.2% of overseas production capacity. If we calculate the impact of vinyl chloride and dichloroethane parking capacity on PVC, we estimate that an additional 950000 tons of PVC production capacity will be affected. Under the background of high premium in Europe and the United States and the continuous opening of China's export window, combined with Formosa Plastics PVC's original maintenance plan, the tension of overseas PVC supply was aggravated. PVC premium in Europe and the United States surged to a historical high.
The outer price rises sharply, China PVC price upper limit space opens. On March 15, Formosa Plastics of Taiwan, China announced the shipping quotation for April, which was totally higher than expected. Compared with the quotation of all regions in March, the quotation of Formosa Plastics increased by 300 US dollars / ton: CFR Southeast Asia 1570 US dollars / ton, CFR China 1510 US dollars / ton, CFR India 1640 US dollars / ton.
The export window continued to open, strengthening the expectation of PVC export volume from February to April. Based on the CFR Southeast Asia price, the export profit of China's PVC by calcium carbide method is estimated to include about US $100 / T sea freight before and US $50-70 / T sea freight recently, and the export window is basically open. Driven by higher export profits, the export volume is expected to be 100000-150000 tons from February to April. As the external price premium continues to be high, a higher export forecast will be maintained from May to June.
Stocks peaked and fell
The seasonal inflection point of PVC social inventory may come ahead of time, especially in East China. Previously, we predicted that the turning point of going to the Treasury would only appear in April, but now it has been advanced to the middle and late March. On the one hand, the burden of calcium carbide industry was reduced; on the other hand, the export patency continued to rise after the decrease of ocean freight, which brought the short-term PVC inventory to peak ahead of time.
Follow up need to continue to pay attention to the continuity of data, verify whether the inflection point of PVC social inventory has arrived ahead of time. At present, the price rise of PVC downstream products is low. Under the background of profit being swallowed by the price rise of raw materials, the purchasing enthusiasm of downstream products is general, so there is a short-term negative feedback phenomenon in downstream products. However, in view of the rigidity of downstream construction and the possibility of price increase of subsequent pipes, we expect that the social inventory of PVC will drop to a historical low from April to May.
