Five reasons to support the rise of concentrated nitric acid prices

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On the 2nd of January, international crude oil prices broke the $100 mark per barrel, setting a new record high. The fact that the oil price has broken 100 is a key point of great symbolic significance. It will directly lead to an increase in the cost of oil consumer groups, and ultimately boost the overall rise in the prices of various production and living materials. Concentrated nitric acid as an important chemical production data, in 2008 the new historical starting point, will run out of what kind of market trajectory? The reporter learned that due to the influence of the international economic climate and the specific conditions of the nitric acid industry in China, there are at least five reasons for the rise in the price of domestic concentrated nitric acid.
Rising prices of raw materials prices China's concentrated nitric acid production enterprises mainly to coal as raw materials, coal prices directly to increase the cost of concentrated nitric acid. In particular, after entering the fourth quarter of last year, the price of coal has risen sharply once again, and the cost pressure of concentrated nitric acid production companies has multiplied several times.
Since November last year, the situation in the synthetic ammonia market has undergone drastic changes. The contradiction between supply and demand has been outstanding, and prices have risen sharply. Especially after entering mid-December last year, the market price of synthetic ammonia has not only been pulled back due to the fall in the prices of urea and refined methanol, but has accelerated. The five-day gain reached 100 yuan (t price, the same below), which greatly increased the cost pressure of concentrated nitric acid. In addition, platinum net is the second largest expenditure in the production of concentrated nitric acid, and its cost position is second only to synthetic ammonia. At present, the price of platinum rhodium is 490 yuan/g, and that of platinum rhodium is 440 yuan/g. The average price per gram is 30 yuan more than that at the beginning of last year, which is more than 100 yuan higher than that in 2006.
The downstream product market is booming. Prices of o-nitrochlorobenzene, MDI, TDI, vanillin, adipic acid and other products have soared and prices are booming. The p-NitroChlorobenzene rose by 1850 yuan from September to November and 3 months last year. Although it declined slightly in December, it still remained at a high level of 4000 to 4,200 yuan; o-nitrochlorobenzene last September - In December, it rose by 2,600 yuan. In contrast, concentrated nitric acid prices have not risen in the past few months, even in the most brilliant 2005 history, the increase has not exceeded 400 yuan.
In addition, the MDI price increase in 2007 exceeded expectations. At present, the mainstream price of pure MDI in China is 2,750 yuan, which is 35% higher than that at the beginning of last year. As the current market supply is still tight, the price of products will continue to rise. TDI increased from RMB 25,000 last year to the current RMB 55,000, and the price has soared by more than twice. At present, the current domestic production capacity has only released more than 200,000 tons, while the demand is as high as more than 400,000 tons. Most of the gaps depend on imports. Combined with the sharp rise in international crude oil prices, all this supports the strong upward trend in TDI prices.
With the colder climate, the downstream MDI capacity expansion, the demand for aniline has also been enlarged, coupled with the aniline enterprises to adopt limited production and price protection measures, so that the market oversupply situation in the fourth quarter of last year has been significantly eased. At present, the domestic market price of aniline has increased from 10,100 to 10,200 yuan at the beginning of last year to the current 10,700 to 11,100 yuan.
Significant increase in pressure on logistics transportation In the fourth quarter of 2007, relevant state departments issued notifications one after another to increase the prices of refined oil, natural gas, and rail freight, which greatly increased the logistics costs of the company. The rise in various freight rates will not only increase the logistics costs of concentrated nitric acid products, but also affect the transportation costs of concentrated raw materials such as coal and timber.
From late October of last year to the Spring Festival this year, the railway sector has focused its operations on ensuring coal transportation and passenger transport on the Chinese New Year, which to some extent has curbed the timely delivery of wagons from other products. Railway is the most important mode of transportation for domestic large-scale concentrated nitric acid production enterprises. The lack of transportation capacity directly constitutes the tension of regional concentrated nitric acid wagons, and the difficulty of resource allocation and dispatching is intensified, causing local market shortages.
In addition, starting from November 9, 2007, five provinces (autonomous regions and municipalities) in North China jointly took action to severely crack down on overloaded and overloaded vehicles. The transport efficiency and transportation costs of raw materials and products required for concentrated nitric acid production are severely challenged. .
Sharp drop in production volume due to low inventory due to the dramatic rise in ammonia prices, resource constraints, in November last year, the national production of concentrated nitric acid was only 181,100 tons, a decrease of 2.7% year-on-year, the chain is even more as much as 16%. This is also extremely rare in the history of concentrated nitric acid production. According to experts' predictions, if the nitric acid industry remains unchanged at the current rate of reduction and maintains for 1 to 2 months, the concentrated nitric acid market resources will not only be insufficient before and after the Spring Festival, but will be rather in short supply.
Due to the low prices in the previous period and the quick entry into the Spring Festival, producers, demanding companies and distributors generally are not optimistic about the concentrated nitric acid market, and domestic nitric acid manufacturers and downstream use units generally have low nitric acid inventory.
The market has no space to fall In the concentrated nitric acid upstream and downstream market prices are soaring at the same time, concentrated nitric acid market prices are almost a point does not rise, becoming a strange landscape of the domestic chemical market in the second half of 2007. From November to December in 2007, the mainstream price of concentrated nitric acid was 1300 to 1350 yuan. According to concentrated nitric acid production and logistics costs, the profitability of domestic nitric acid companies was almost zero, and some even appeared to have costs and prices inverted. Until the end of last year, the nitric acid companies had encountered not only the problem of whether the production and operation could continue to operate, but whether they could survive. The production cuts and shutdowns of many nitric acid plants became a necessity in the domestic concentrated nitric acid industry in December last year. If the domestic market price of concentrated nitric acid is not improved as soon as possible, the situation that there will be no raw materials for downstream production will soon appear.
Due to the long-term weakness of the concentrated nitric acid market, the energy for incremental expansion has already been fully released, and there is no incremental power at the end of the period. The market share of nitric acid companies is relatively stable.

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