Introduction: The DOP market has abundant supply this year, with production and supply increasing by 8.55% year-on-year, so the price lows are constantly being refreshed. As of September 3, the price in the Jiangsu market (the same below) was 7,550 yuan/ton, down 650 yuan/ton from the opening price at the beginning of the year.
The continuous oversupply during the year has led to a continuous refresh of low prices.
At present, the average market price of DOP is 8,185 yuan/ton, down 17.18% year-on-year. The highest price in the year was 8,700 yuan/ton in February, and the bottom was 7,750 yuan/ton in early May. However, by early September, the bottom had dropped to 7,550 yuan/ton, with a price fluctuation of 13.51%.
Figure 1 Domestic DOP price trend chart (yuan/ton)
Data source:
Currently, the annual DOP production has exceeded 950,000 tons, an increase of 8.55% year-on-year. The average capacity utilization rate is at 63%, which is at a medium-to-high level of operation. The market supply is sufficient, and there is a continuous supply of spot inventory in the market this year, while the market demand is gradually declining. The oversupply pattern is obvious, and merchants are actively clearing inventory. In addition, with the increase in the market supply of raw material octanol, the price has also been discounted, resulting in a periodic downward trend in the domestic market price of DOP.
Currently, the production is at a high level, but the profit level is declining
The maintenance losses in July were at the level of 37,000 tons, the highest in the year. Many units in the market underwent routine maintenance and costly shutdown operations, but as the shut-down units were gradually restored, the market capacity utilization rate rose again to over 60%.
Figure 2 Domestic DOP Capacity Utilization and Profit Trends (%, Yuan/ton)
Data source:
Since the end of July, the DOP market capacity utilization rate has reached a high of 67% and a low of 62%. Most of the current market devices are operating normally, and there will be load-increasing devices next week. With the production volume plus the spot inventory supply, the supply of goods continues to be abundant. As the market price falls, the profit level has also declined. It is currently operating around the cost line. Recently, around the end of August, the profit level was slightly better at around 110 yuan/ton, but the current market profit margin has dropped to around 30 yuan/ton.
DOP prices are under downward pressure, waiting for demand to boost
The downstream consumer market has entered the golden September, but the current downstream user orders have not seen any significant improvement, and the market spot digestion rate is still slow. With the resumption of production of some reduced production units, the DOP capacity utilization rate is expected to reach around 68% in the middle of the month, which is still a relatively high level of operation. The overall market supply continues to be abundant. In addition, there are plans to put new production capacity of octanol into the market in the fourth quarter, which also has an impact on the mentality of market merchants. Therefore, while waiting for downstream user orders to improve, the DOP market price is still under pressure and the price is still loose.
