Asia ACN snaps four-month uptrend; may soften near term

SINGAPORE (ICIS)–Asia’s acrylonitrile (ACN) prices fell for the first time since early July, tracking losses in the key China market, which is bracing for increased supply when a new domestic plant starts up.

Prices may continue to soften but not by much amid uncertainties on the plant’s start-up date, and as regional supply is still tight amid ongoing plant turnarounds in Taiwan and China.

In the week ended 10 November, spot prices declined by $50/tonne week on week to $1,900-1,950/tonne CFR (cost and freight) NE (northeast) Asia, ending nearly four months of uptrend, according to ICIS.

“Local prices in China fell a lot, so I believe the import prices will drop further to follow the suit,” a regional trader said.

China is a major importer of ACN.

Early this week, offers were heard at $1,950-2,000/tonne CFR NE Asia, while few firm buying indications were capped at $1,900/tonne CFR NE Asia.

Regional prices may continue tracking China’s domestic market, in which downstream acrylic fibre (AF) producers have started to pose strong resistance to further spikes in ACN values.

On 13 November, domestic ACN prices in east China stood at Chinese yuan (CNY) 14,600-14,800/tonne ex-tank, down by CNY1,400/tonne or about 9% from end-October, according to data compiled by the China editorial team at ICIS.

Major Asian suppliers had lowered their offers but were not in a hurry to offload cargoes given their low ACN inventory.

Buyers and end-users, on the other hand, retreated to the sidelines awaiting further declines in prices.

The Chinese market is expected to welcome 130,000 tonne/year of new ACN capacity from Shandong Haili Chemical Industry in November, but there are concerns that the start-up would be delayed.

Overall supply of ACN in Asia, however, has remained tight as major plants in China and Taiwan are currently shut.

In China, Sinopec Qilu Petrochemical’s 80,000 tonne/year unit in Zibo, Shandong province has remained shut since mid-July. The shutdown is related to strict environmental inspections of Chinese factories.

PetroChina Jilin Petrochemical, meanwhile, has scheduled week-long turnarounds at three of its ACN units, which will take turns in shutting down this month.

In Taiwan, China Petrochemical Development Corp (CPDC) shut its 240,000 tonnes/year plant in Kaohsiung on 10 November for a turnaround of about two weeks.

Focus article by Judith Wang

($1 = CNY6.64)

Picture: Acrylonitrile (ACN) is used in the production of acrylic fibres, which go into home furnishings like sofas. (Source: View Pictures/REX/Shutterstock)