Acrylonitrile Prices Are Expected to Rise in February Due To Rising Propylene Prices In The Asia

Acrylonitrile prices rose in Asian market last week, owing to surging upstream Propylene. Players witnessed a market scenario in which product supply tightened, while a series of planned regional plant turnarounds helped improve the buying sentiments. The price rise was attributed to firmer upstream energy values and protracted tight product avails within the region. The Acrylonitrile market is probably going to trend higher within the week as global shortage woes lend support. In South Asia, Acrylonitrile prices rose by USD30/MT, hitting a new 20-month high during the start of February.

The Chinese propylene market is expected to rise this week, owing to disruptions in Deepsea shipments from the US due to bad weather and restocking demands following the Lunar New Year vacations. China has a scarcity of supplies. Shandong Shida Shenghua Chemical produces 70,000 t/yr. of petrochemicals. The plant is prepared for shutdown and is currently operating at about 70% capacity. These factors have pushed up production margins for China's non-integrated Propylene manufacturers to a three-month high, with FOB offers at USD1950/MT.

Following the announcement of force majeures by Cornerstone in the United States and INEOS in Europe, spot supplies were tight around the world. India used to be more reliant on the United States and Europe for its acrylonitrile needs, but the South Asian country is now competing for the product with consumers from other regions of Asia.

Due to the quick rise in domestic Acrylonitrile costs, downstream sectors that are prone to raw material prices, such as Acrylic fibre and Amide, are considering lowering load or rearranging parking, which is something that deserves to be considered. CFR Vizag (India) offers for Acrylonitrile were quoted at USD 1485/MT. As per ChemAnalyst, “Healthy demand and constrained supply are projected to stay fundamentals in South Korea and India optimistic. In the coming week, South Korean importers will likely be keeping a close eye on Indian acrylonitrile prices as the two countries compete for cargoes in the subcontinent market”