Market forecast for 2024:
Supply side:
In recent years, the production capacity growth rate of China's melamine industry had slowed down compared to the previous period. In 2023, the industry's production capacity had slightly increased, including the production of 60,000 tons/year by Chongqing Jianfeng Chemical Co., Ltd. and 100,000 tons/year by Sichuan Jinxiang Sairui Chemical Co., Ltd. The melamine market was sluggish in 2023, with limited profits and reduced production enthusiasm. Overall production in 2023 had slightly decreased compared to 2022, and it is expected that the melamine industry will continue to operate at a low level in 2024.
Demand side:
Melamine has a wide range of demands, mainly used in board, melamine powder and impregnated paper, as well as in the production of coatings, resins, flame retardant materials. It can also be used as anti folding and anti shrinkage agents for textiles, synthetic fire-resistant layer bonding, fixing or hardening agents for waterproofing agents, etc. It is expected that downstream demand will remain relatively stable in 2024, with a focus on continuing to buy in demand.
Import and export:
According to customs data, the total import volume of melamine in China in 2023 was 265,928 kilograms, a year-on-year decrease of 29.34%. In 2023, the total export volume of melamine in China was 476,452,855 kilograms, a year-on-year decrease of 10.78%.
Cost side:
Raw material urea: According to the commodity analysis system of SunSirs, the mainstream market price of urea in Shandong Province had shown an overall downward trend in 2023. The price at the beginning of the year was 2,698.00 RMB/ton, and the price at the end of the year was 2,485.00 RMB/ton, with a year-on-year decline of 7.89%.
From the SunSirs, it can be seen that the price trend of melamine in 2023 was roughly similar to the trend of raw material urea. It is expected that the price changes in the melamine industry will still be greatly affected by the upstream urea industry in 2024.
Comprehensive prediction:
In summary, the changes in the supply and demand pattern of the melamine industry in 2024 may be relatively limited. It is expected that the melamine market will follow the trend of raw material urea prices in 2024, and more attention still needs to be paid to export demand, related policies, and other factors.
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