Butanediol Price Surges by 33 per cent in China Amidst Supply Crunch
- 24-Mar-2021 4:00 PM
- Journalist: Robert Hume
Chinese 1,4-Butanediol (BDO) is continuously inclining to break records. As per ChemAnalyst pricing data, BDO FOB Shanghai price for the month of March has been assessed at USD 4500 per tonne while FOB Quingdao offers have been raised to USD 4565 per tonne, extending strong gains after the Chinese Lunar New Year. Since February, settlements for BDO have risen by around 33% in China with the players pointing towards persistent supply shortage as the key factor concerning the buyers.
Key plant movements observed in the Feb-Mar period are:
• Shaanxi Ronghe's 60 KTPA BDO facility has been shut for maintenance since February 28th.
• Shanxi Sanwei's, 75 KTPA plant is under maintenance with no official information of restart in the market. The company is currently not providing any BDO quotations as of now.
• Yizheng Dalian's BDO plant with a capacity 50 KTPA is operating normally. The company is taking long-term contract orders until shortage persists.
• Fu Chemical Trade (Meizhou Bay, Fujian) BDO facility of capacity 40 KT has resumed production. The plant is mainly running for captive consumption.
• 100 KTPA plant of Inner Mongolia Dongyuan Technology Co. Ltd. was shut on March 15 for catalyst replacement drive. The plant was restarted on the 21st of the month.
• Production at Sinopec Great Wall Energy and Chemical Co. Ltd., having two BDO units of 100 KT each has been running stably. The company is likely to hold maintenance drive in April.
• Henan Kaixiang's 110 KTPA BDO plant is currently in stable operation and as per the company officials, its main contract orders have been delivered.
As per industry experts, the price fundamentals are gaining stimulus from a series of plant turnarounds in China, Japan, US and Europe which have adversely impacted the global BDO supply chains. Downstream PBAT/PBS markets are operating at optimum levels amid inflows of a good number of sales enquiries. A BDO manufacturer based in southwest China highlighted that facing the double whammy of tight supply and soaring rates, most downstream plants are operating at low capacities. The market is trying to balance out while sellers and buyers are cautiously waiting for an appropriate fall in price.