Semi-annual Summary Of Epoxy Resin Industry

  The first half of 2021 is a special year for the epoxy resin industry. Beginning in the second half of 2020, driven by the rush to install wind power, industry demand has exploded, and the boom will continue until the first quarter of 2021. During this period, due to factors such as the suspension of production at home and abroad and the surge in raw material prices, the price of epoxy resin once surpassed the "sky price" of more than 40,000/ton.

  In the second quarter, although the price of epoxy resin dropped somewhat, the price was still at a historical high, and the industry's enthusiasm remained unabated. Based on optimistic market judgments and hot market conditions, existing epoxy resin companies have a strong willingness to expand production, and they have also attracted many new entrants in the industry. In the first half of the year, epoxy 

resin industry chain projects were signed together. According to incomplete statistics from ACMI, it is estimated that by the end of 2021, China's epoxy resin will increase its production capacity by 660,000 tons per year, becoming the fastest release of production capacity in recent years. According to the current plan, it is estimated that by the end of the "14th Five-Year Plan" period, China's new epoxy resin production capacity will reach more than 2.4 million tons per year.

  As we know, epoxy resin is the main raw material of FR4 sheet and 3240 Epoxy Resin Sheet, so we need to pay much attention on every news about epoxy resin.

1. The price trend of main raw materials

  In the first half of 2021, international crude oil prices rose sharply, from 47 US dollars per barrel at the beginning of the year to more than 70 US dollars per barrel, a half-year increase of over 50%. Moreover, market participants are more optimistic about the outlook for international oil prices. Executives of large oil trading companies such as Victor, Glencore and Trafigura have previously stated that there is still room for oil prices to rise, with the possibility of rising to US$100 per barrel.

WTI Crude Oil Price Trend (USD / barrel)

  In the first half of the year, the main raw materials of bisphenol A-phenol and acetone, and the main raw materials of epichlorohydrin-propylene and glycerin, the prices of the four raw materials increased, stabilized and decreased. The big increase is phenol, which has a price of nearly 10,000 yuan, and the production cost of bisphenol A has increased significantly. The glycerin method is currently the mainstream production process of epichlorohydrin in China, and the production capacity of cyclochloride in the glycerin method accounts for about 57%. The price of glycerin continues to be high, which has brought considerable pressure to the ring chlorine production enterprises.

  The following prices are in the East China market:

  Phenol: continued to rise, from 6,100 yuan/ton at the beginning of the year to 9,500 yuan/ton at the end of June, an increase of 55.7% in the first half of the year;

  Acetone: The high level dropped, from 5,900 yuan/ton at the beginning of the year to 9,300 yuan/ton in early March, and then fell back to 5,000 yuan/ton at the end of June, and the overall decline in the first half of the year was 18%;

  Propylene: first rose and then fell, the price at the beginning of the year and the middle of the year was basically the same, both at around 7,500 yuan/ton;

  95% glycerin: first rose and then stabilized, rising from 4,900 yuan/ton at the beginning of the year to 8,000 yuan/ton at the end of April, and then the performance was stable. At the end of June, the price was around 7,500 yuan/ton, an increase of 53.1% in the first half of the year.

Prices of Main Upstream Raw Materials in the First Half of the Year

2. The price trend of main products in the epoxy resin industry chain

  In the first half of 2021, the domestic epoxy resin market experienced great ups and downs. In 2021, the general chemical industry will rise, and the epoxy resin industry will show a high degree of prosperity due to the combined effects of external inflation + epidemic recovery + rapid recovery of downstream demand + rising raw material prices.

  In February, affected by the cold wave in the United States, many sets of phenol ketone and bisphenol A plants were offline, and PC and epoxy resin manufacturers started the battle for raw materials. BPA continued to rise. The high price continued for several months. Promote the overall upward trend of the entire epoxy resin industry.

  In mid-April, the epoxy resin industry reached its heyday. The price of liquid resin exceeded 40,000 yuan/ton. The downstream endurance of high-priced raw materials reached the extreme, and the market began to decline. In the second quarter, the operating rate of bisphenol A and epoxy resin factories was generally high, and the market spot was sufficient. In addition, the industry entered the off-season in the middle of the year and demand support was insufficient. The epoxy resin industry opened a long-term downward channel. Judging from the long historical data cycle, the price of liquid epoxy resin basically fluctuates between 15,000 and 25,000 yuan/ton, and the current epoxy price is still at a historical high.

  From the perspective of the price curve, the price curve trends of the four products are particularly similar. They rose from January to mid-April, and then fluctuated downward:

  E51: From 21,500 yuan/ton at the beginning of the year to 41,000 yuan/ton in mid-April, and then down to 25,500 yuan/ton at the end of June, the overall increase in the first half of the year was 18.6%;

  E12: From 17,500 yuan/ton at the beginning of the year to 34,000 yuan/ton in mid-April, and then down to 24,300 yuan/ton/ton at the end of June, the overall increase in the first half of the year was 38.9%

  Bisphenol A: from 12,700 yuan/ton at the beginning of the year to 30,000 yuan/ton in mid-April, and then down to 20,300 yuan/ton at the end of June. The overall increase in the first half of the year was 59.8%

  Epichlorohydrin: from 11,700 yuan/ton at the beginning of the year to 16,600 yuan/ton in mid-April, and then down to 12,800 yuan/ton at the end of June, an overall increase of 9.4% in the first half of the year.

Product Price of Epoxy Resin Industry Chain in the First Half of the Year

3. import and export

January-May 2021:

  The total import volume of epoxy resin was 153,000 tons, a year-on-year increase of 22.8%; the total export volume was 36,300 tons, a year-on-year increase of 84.2%;

  The total import volume of bisphenol A was 200.6 million tons, a year-on-year increase of 23.8%; the total export volume was 2,149 tons, a year-on-year decrease of 41.9%;

  The total import volume of epichlorohydrin was 859 tons, a year-on-year decrease of 69.6%; the total export volume was 22,400 tons, a year-on-year increase of 51.6%.

  Summary: The export volume of epoxy resin has grown steadily, especially in May, when the export volume exceeded 10,000 tons; BPA still needs a large amount of imports, basically "only in but not out", especially the export volume in May was only a single digit; After years of anti-dumping, cyclochlorine has become self-sufficient in recent years from the previous large-scale imports, and it can also be exported in small quantities.

Total Import and Export Volume of Main Products of Epoxy Industry Chain from January to May 2021 (Tons)