Hengli, Zhejiang Petrochemical Put Into Operation Extrusion Effect: Petrochemical Products Competition Is White Hot!

In the traditional oil refining era, waved goodbye.

In May 11th, according to the news channel of CCTV news channel, the Hengli refining and chemical integration project was put into operation.

The crude oil processing capacity of Hengli petrochemical project is 20 million tons / year. The combined scale of aromatics unit is 4 million 500 thousand tons / year (para xylene yield), crude oil is sand weight, sand and Marin crude oil, the total hydrogenation process is adopted, and the hydrogenation scale is 23 million tons / year.

Hengli Group has taken the lead in entering the whole industrial chain from "one drop of oil" to "one piece of cloth".

In May 20th, the "40 million ton / year refining and chemical integration project (phase I)" invested by Rongsheng Petrochemical holding subsidiary Zhejiang Petrochemical Co., Ltd. in Zhoushan green petrochemical base has completed the preliminary work of engineering construction, equipment installation and commissioning.

Elimination impact!

PX profits negative earnings Era

Tens of millions of tons of large-scale private refinery and chemical integration projects put into operation in traditional fuel refineries, and local refinery operations are facing major challenges.

Hengli petrochemical products are gradually being put on the market to form a roller compacted market for traditional refining and other chemical products, and their competitive advantages are highlighted.

Since the commissioning of Hengli refinery, the profits of olefin and aromatics in the market have shown a marked decline.

It has attracted much attention as one of the most profitable varieties in the polyester industry chain. According to data monitoring, the peak value of PX in 2019 was 305.36 US dollars per ton, and the nuclear production of one ton of PX products had more than 2000 yuan profit margins. However, with the Hengli petrochemical, two new total capacity of 4 million 500 thousand tons of PX was put into production (1# 2 million 250 thousand tons / year production line produced qualified products in March 24th, the load remained stable near 50%-60%, the 2#225 million ton / year production line was officially put into operation in May 11th, and the load was below 50%). The domestic supply and demand pattern and participants' mentality were all under obvious pressure. PX prices opened strong unilateral downward trend, and then the profit space concomitant appeared obvious shrinkage, and quickly fell to below the cost level. PX

By May 17th, the PX profit fell to -18.13 U.S. dollars / ton, at a loss, and last year it was a year and a half after a negative profit.

Asia PX overhaul process concentrated outbreak, or still difficult to change the trend of decline

Affected by the current negative earnings situation, the market pays close attention to the operation of PX devices in Asia. As shown in the table, the total changes in Asian PX installations in the second quarter involve a total capacity of 8 million 797 thousand tons, of which most of the change plans are expected to be set up at the beginning of the year, and the unexpected parking incidents of only the Taiwan chemical fiber 3# device and the two sets of JX devices in Japan are not included in the plan. The extension of South Korea's S-oil maintenance time and the Yishan maintenance process in Vietnam are ahead of schedule.

At the same time, it is related to the reduction of production. At present, the 1 million tons / year PX installation in Qingdao alone is expected to reduce its load to 60%, but no specific downtime has yet been announced. It is reported that if the PX-MX spreads continue to shrink, Korea's Lotte chemical is considering reducing the total output of Ulsan's two sets of PX devices with a total capacity of 750 thousand tons (currently the two sets of devices are operating at full capacity).

Another Korean PX manufacturer, Hyundai, said that if PX profit is still negative, it will consider adjusting the mountain capacity to 1 million 180 thousand tons / year PX device load.

South Korea is the largest importer of PX in China. It has always held the right to speak PX and has a high profit. In 2018, China imported 15 million 904 thousand and 500 tons of PX and 7 million 210 thousand and 800 tons from South Korea, accounting for 45.34%. In the first three months of 2019, China imported 4 million 235 thousand and 100 tons of PX and 1 million 595 thousand and 500 tons from South Korea, accounting for 37.67%.

However, the price of Asian PX has increased significantly since March, and some Korean PX producers expect that the volume of PX exported to Korea will fall sharply in the 2 quarter of 2019.

In addition to the deterioration of its own supply and demand pattern, the pressure from Hengli Petrochemical Company on the market confidence can also be seen. Recently, along with the concentrated outbreak of the PX overhaul process in Asia, it is expected that the price of PX will have a short wave of consolidation, but its impact will be far less than expected. The construction of the 4 million ton / year PX production line of Zhejiang Petrochemical Company is expected to reach the fourth quarter this year, and the new pressure of Brunei Heng Yi project and Hainan two phase project will continue to impact the market, so the PX market will remain vacant for a long time.

The private enterprise is the first to bear the brunt, the international magnate to share the share, the petrochemical industry welcomes the huge change!

The Sinopec industry has ushered in a wave of planning, construction and commissioning of a large-scale refinery and chemical integration project. Private enterprises, main units and international giants are rushing to the beach to bring far-reaching impact to the petrochemical market in the future.

Private enterprises gather together to build an integrated industrial chain of refining and chemical industry. In addition to Hengli Group Dalian Changxing Island project, Zhejiang Petrochemical refining and chemical project (phase I), Sheng Hong refining and chemical project starts construction, and sinohua sunyang refining and chemical project is about to start.

The main units are taking the lead in the construction of Sinopec refining and chemical industry, the Central Committee of Guangdong petrochemical, Sinochem Quanzhou refinery (phase two) and other refinery and petrochemical integration projects are being promoted.

International giants are also coming to China's refining and chemical market. Apart from ExxonMobil and BASF's wholly foreign-owned petrochemical projects, Shell, SABIC and Saudi Amy will cooperate with domestic petrochemical enterprises in refining and chemical industry.

The pformation and upgrading of Shandong's land refining industry is laying out a large-scale integrated project on Yulong island.

Along with the gradual promotion of these large-scale refinery and chemical integration projects, the Sinopec industry will surely undergo new changes. The participants in our market industry should follow up and adjust themselves in time to find new opportunities in such a pformation.