Production disruption in Shouguang city to put pressure on Bromine Prices in China in Q1 2022

Gulf Resource, a renowned Chinese producer of Bromine, crude salt, and specialised chemical products, said on December 27, 2021, that the facility will be closed temporarily from December 28, 2021, to February 21, 2022, in accordance with government orders. The Shouguang government has ordered a seasonal closure as part of a government action plan to curb air pollution, which worsens in the winter, and to improve the overall development efficiency of brine resources. 

Because of the plant closures, Bromine prices will be heavily influenced in the coming quarter on the back of supply chain disruptions, as halted production would put pressure on local manufacturers, resulting in inventory shortages. Increased demand from downstream, such as agrochemicals and pharmaceuticals, will be restricted by production reduction, leading to further price hikes. Current price for Bromine EXW Shandong is assessed around USD 10477 per MT. 

“The present challenges faced by the Bromine manufacturers are finding a solution for Bromine and crude salt co-production at four of the other ten Bromine plants, as well as their rectification and enhancement. The other is the construction of a new canal, which is required by government correction and enhancement. “Mentioned a respondent. 

As per ChemAnalyst, “Bromine prices are expected to rise in Q1 2022, as increased demand for flame retardants in the construction, automotive, and other industries, as well as rising demand for clear brine fluids in oil and gas extraction, are expected to drive up demand. Consumers will not be able to place large orders over the Chinese New Year due to production constraints and supply shortages”