Industrial naphthalene: The market remains strong after the combination of favorable factors

时间：2024.08.21

Since the beginning of this year, the domestic industrial naphthalene market has not experienced significant fluctuations following the trend of coal chemical products, but has basically maintained a narrow consolidation trend. After entering late May, the industrial naphthalene market gradually rebounded and improved. As of June 20th, the mainstream transaction price in China was around 5800 yuan (ton price, the same below), with a month on month increase of more than 2%. The highest increase in mid June exceeded 4%. Although there was a brief slight decline afterwards, based on the support of multiple favorable factors, the strong trend in the future is still favored by the industry.

“Looking back at the industrial naphthalene market this year, it has shown a stable and positive trend overall, and the coal chemical product market can be described as; A solitary branch stands out;. Especially since May, against the backdrop of continuous decline in prices of various coal chemical products, the industrial naphthalene market has been able to warm up against the trend, mainly due to the decline in production of deep processing enterprises, low inventory of product circulation, and expectations of demand growth& rdquo; Meng Jianjie, Marketing Manager of Zhengzhou Dayou Gas Co., Ltd., said.

Market supply decline

According to Longzhong Information, the comprehensive operating rate of domestic coal tar deep processing enterprises has remained low since the beginning of this year, basically maintaining at 46% to 50% from January to April; Since May, the operating rate has shown a continuous downward trend. As of June 21, the weekly average operating rate has dropped from around 50% at the beginning of May to 45.3%. It is expected that the monthly production of industrial naphthalene will be around 104000 tons, a decrease of 2.4% compared to the previous month.

Meng Jianjie stated that the market performance has remained stable this year due to the stable downstream demand for industrial naphthalene and a slight decrease in production. This is also one of the reasons why industrial naphthalene has not followed the price fluctuations of other coal chemical products. From the historical trend of industrial naphthalene, under normal circumstances, once the supply increases or decreases by more than 5%, it will trigger market fluctuations. Based on the current supply and demand transaction status, the operating rate of coal tar deep processing enterprises is between 45% and 50%, which poses certain constraints on the industrial naphthalene market. Therefore, prices will not experience significant fluctuations regardless of whether they rise or fall. However, the production of industrial naphthalene in June fell to near the lower limit, providing positive support for the market, and it cannot be ruled out that there may still be a possibility of further recovery in the future.

Low circulating inventory

According to frontline market information, from June 19th to 20th, the bidding prices for Shanxi Jinyuan and Shanxi Coking Industry naphthalene were 5750 yuan and 5710 yuan respectively. On June 20th, Baoshun Technology Co., Ltd. offered a price of 6000 yuan. Against the backdrop of a slight increase in the execution price of industrial naphthalene transactions, the trading volume was not large.

“After nearly half a year of narrow adjustment, the circulating supply of industrial naphthalene in the market has been consumed to the lower limit, especially with little inventory in the hands of traders. This is also the reason why industrial naphthalene can withstand the trend despite the significant decline of mainstream products in the industry chain such as coal tar and coal tar& rdquo; Senior market commentator Shao Huiwen analyzed that.

Expected growth in demand

According to the person in charge of a naphthalene phthalic anhydride enterprise in Hebei, due to the rising prices of benzene products, naphthalene phthalic anhydride has a cost advantage compared to ortho phthalic anhydride. Since mid to late June, naphthalene phthalic anhydride has shown another upward trend. As of June 20th, the mainstream transaction price has reached over 7400 yuan, with a weekly increase of 1.4%. Enterprises are actively starting production, so it has become inevitable to increase the procurement of industrial naphthalene in the future. In addition, many domestic coal tar deep processing enterprises have built their own naphthalene phthalic anhydride plants, which has led to a low market demand for industrial naphthalene and is favorable for the recovery of the industrial naphthalene market.

“In June, due to a combination of factors such as high temperatures in the north, rainy season in the south, and the launch of environmental inspections in various provinces, there were many temporary shutdowns of engineering projects in different regions. The procurement of raw materials by water reducing agent enterprises slowed down, which had a negative impact on the industrial naphthalene market. But with the easing and release of negative factors, the rigid demand for water reducing agents will continue to recover, and it is not ruled out that phased replenishment may be initiated& rdquo; The person in charge of a coal chemical project under construction in Inner Mongolia said.

Industry insiders analyze that currently, supported by multiple favorable factors such as the stabilization of raw coal tar prices, the approaching lower limit of operating rates for deep processing enterprises, and potential growth in demand, the recovery trend of the industrial naphthalene market is expected to continue.