Casa> Blog> Chlor-alkali Chemicals suffer from stoppages

Chlor-alkali Chemicals suffer from stoppages

April 13, 2024
On December 25, Shanghai Tianyuan Huasheng Chemical Co., Ltd. (a wholly-owned subsidiary of chlor-alkali chemical industry (hereinafter referred to as Tianyuan Huasheng), a subsidiary of Shanghai Tianyuan Huasheng Chemical Industry Co., Ltd., located in Shanghai Chemical Industry Park Production facilities, quietly standing in the factory area, enjoying the winter sunshine. And it has been so quiet for two weeks.
"Discontinued production is a last resort, and this matter will indeed have a great impact on our performance this month, or that of the fourth quarter." After the impact of suspension of production, chloro-alkali chemical (600618.SH)'s director secret Xu Peiwen's voice Slightly heavy.
Xu Peiwen said, "The reasons for the suspension of work are many: On the one hand, there is insufficient supply of ethylene for the upstream raw materials; on the other hand, due to the impact of the international financial crisis, the installations of the downstream companies of the entire chemical park have been suspended."
Reproduction by the end of December
Tianyuan Huasheng not only stopped the production of dichloroethane (EDC), but also reduced production of caustic soda and PVC plants. "Our devices are all connected together, so when dichloroethane is discontinued, the production of our other products will certainly be affected," Xu Peiwen said frankly.
The data shows that chlor-alkali chemical's main business is PVC, caustic soda and chlorine products. Among them, PVC accounts for more than 40% of operating revenue, and chlorine products represented by dichloroethane are the second largest source of profits for the company.
In the first three quarters of the company's operating income was 2.84 billion yuan, of which PVC's revenue was 1.311 billion yuan, accounting for 44.79 of total revenue, but the gross profit margin of such products was -8.84%. In contrast, the profit contribution of caustic soda reached 79%.
"The reason why the gross profit of PVC is so low is because the production of PVC for the company uses the ethylene process." An industry official in the chemical industry said: "This is a product derived from petroleum, so it is sensitive to fluctuations in oil prices." ."
The rapid rise in international oil prices in the first half of this year led to a substantial increase in production costs. However, compared with domestic companies that use calcium carbide to produce PVC, the production cost of chlor-alkali chemicals is still too high and it is at a disadvantage in the competition.
Since the second half of the year, with the sharp drop in oil prices, the company's production costs have also entered a decline, and the market competitiveness of products has also been enhanced.
A chlor-alkali chemical worker said: “Since this time, the sales of our company's PVC have been much better than before, and there is no inventory.” In fact, as of December 9, the price of the company's PVC has been 5500 from the previous period. RMB/ton increased to RMB 6,400/ton, and the PVC business is in the best operating condition in the year.
No, sudden stoppages affected the production of PVC.
The industry is stranded
The suspension of production of some of the chlor-alkali chemical plants has reflected the difficulties of the entire chlor-alkali industry. “Now, many chemical-industry-owned plants in the chemical park have all stopped working,” said a staff member of the chlor-alkali chemical securities office.
Under the background of a sharp drop in the industrial boom, the lack of downstream demand is an important factor affecting the PVC market. On December 16, in the Guangdong Plastics Exchange, due to the rise in the price of calcium carbide, some PVC manufacturers raised the ex-factory price of PVC, but due to insufficient demand, the market had only a small amount of transactions.
In addition to PVC, the demand for caustic soda has also unavoidably weakened. "The domestic caustic soda market is under pressure. This is a chain reaction," said industry analysts. Data from the Chemical Consultation Network shows that in mid-December, the price of caustic soda continued to be light.
Under such an industry situation, it is not surprising that chemical companies have reduced their load and stopped production. Taking Hangzhou Power Group as an example, due to the increase of electricity and coke prices, the company’s cost pressure was too high, and 80,000 tons of PVC production facilities were forced to stop production. The PVC production line with an annual production capacity of 120,000 tons at the giant plastic company in Zhejiang is also in a standstill.
According to the third quarter report released by seven listed companies in the chlor-alkali chemical industry, the profitability of most chlor-alkali enterprises fell from January to September. For instance, the total profit of Zhejiang Juhua Co., Ltd. (600160 Quotes, Love Shares, main trend) has dropped by 96.31%; the total profit of Nanning Chemical Industry Co., Ltd. has dropped by 291.80%.
Analysts said that at present, during the difficult period of the industry, new challenges have been raised for the chlor-alkali industry, and high costs and other pressures will prompt the chemical industry to accelerate the pace of integration.
Contattaci

Author:

Mr. KUI ZHAO

Phone/WhatsApp:

+8613921219871

Prodotti popolari
You may also like
Related Categories

Mail a questo fornitore

Oggetto:
E-mail:
messaggio:

Your message must be betwwen 20-8000 characters

Contattaci

Author:

Mr. KUI ZHAO

Phone/WhatsApp:

+8613921219871

Prodotti popolari
We will contact you immediately

Fill in more information so that we can get in touch with you faster

Privacy statement: Your privacy is very important to Us. Our company promises not to disclose your personal information to any external company with out your explicit permission.

Invia