China ACN: caution under previous wrong judgment

This year, the prices of China ACN seem to fluctuate smoothly, and the fluctuations increase somewhat in one month, including several times of wrong judgment on market forecast.

Take July market as an example. In early Jul, with the expectations of start-up of Zhejiang Petrochemical’s new unit and restart of PetroChina Jilin, offers edged lower first. But later, with the delayed of the new unit and the maintenance of Jiangsu Sailboat’s unit, the prices turned to move up. Though the prices have not increased much, traders’sales with discounts led to losses after the release of the settlement prices. This situation has appeared in several months of this year. So though the Zhejiang Petrochemical’s new unit has started up currently, the market has not anticipated a large decline in Sep.

In the meantime, the maintenance plan appears every month, and some units are shut unexpectedly. Market players cannot know in advance, which causes the wrong judgment on market forecast as well.

For exports, exports have risen obviously in Jan-Jul 2021 compared with last year, especially the volumes in Jan-Feb and Apr-Jun, which have doubled year on year. The large exports also make the plant inventory maintain at low level for long time, and producers have confidence on settlement prices. Since this year, the market forecast price is lower than the settlement price in several months.

Therefore, the previous wrong judgment makes market players cautious to operate and forecast. Even the Zhejiang Petrochemical’s new unit has start up, due to its not high operating rate, export opportunities and maintenance plan of Jiangsu Sailboat in Oct, the market gains certain support. The unpredictable market also makes players tend to conclude contract sales.