Price trend

In 2022, the domestic EA market fell in shock. According to the monitoring of SunSirs, the annual decline was 17.65%, and the price dropped from about 8,800 RMB/ton at the beginning of the year to about 7,200 RMB/ton.

Analysis review

On the one hand, the price of acetic acid fell sharply due to the suppression of cost. On the other hand, the contradiction between supply and demand was prominent. The EA industry was highly competitive, with serious overcapacity. The annual average operating rate of the industry was squeezed below 50%. Especially in the second half of the year, the price of EA fell steadily, and at the end of November, it hit a new low for the whole year.

Specific trend:

Phase I: From January to February, the price of EA plummeted from 8,800 yuan to 7,800 RMB/ton, a drop of 1,000 yuan. On the one hand, acetic acid fell sharply, cost dragged down the market of ethyl ester. Acetic acid dropped by nearly 30% in the first two months. Acetic acid enterprises had oversupply, market supply exceeded demand, and the profits of acetic acid enterprises continued to decline. On the other hand, in February, the construction started to improve. After the festival, the main factories in Shandong stopped bidding. The factories accumulated inventory and the supply was loose. The manufacturers were forced to reduce prices and inventory, which depressed market confidence.

Phase II: From March to the first ten days of May, EA came out of the shock and rebound market, mainly because the main factories in Shandong stopped for maintenance for a long time, the pressure of tight supply was greatly relieved, and the demand rebounded seasonally, so the price was relatively strong. At this time, the price of acetic acid was at a historical low level, and EA enterprises had also maintained a high profit margin.

Phase Ⅲ: From the middle of May to the end of November, acetic acid continued to decline unilaterally, with a drop of more than 20%. The main reason was the steep drop of upstream acetic acid. In June, July and August, acetic acid dropped by more than 40%. Moreover, the pressure of supply and demand appeared. With the resumption of the main factories in Shandong, the supply surged. In addition, due to the epidemic situation, downstream shipments were not smooth, and the price of EA fell again and again.

Phase IV: Since December, EA had rebounded from the bottom. The direct reason was that Shandong large factories stopped selling and supply was tightened. The indirect reason was that the epidemic situation led to a sharp increase in the price of ethanol. As a result, some EA enterprises shut down their plants and resell ethanol, aggravating the shortage of EA supply.

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