In the third quarter, the ABS market of Yuyao Plastic City basically showed a trend of first falling and then rising. After falling to a new low of the year in late August, the market rebounded strongly. As of October 12, the mainstream offer of domestic brands in the plastic city ABS market is 12500-13100 yuan / ton.
ABS enterprise profit level:
In the third quarter of 2022, the theoretical average profit margin of domestic ABS petrochemical manufacturers is around 670 yuan / ton, down 580 yuan / ton from the second quarter, and plunged by more than 4,400 yuan / ton from the third quarter of last year. At the beginning of the third quarter of 2022, the theoretical profit margin of petrochemical manufacturers has shrunk seriously, and even suffered losses for a time. The profit margin has improved in the middle and late third quarter, but the ultra-high profit margin is difficult to reproduce.
From the perspective of cost, styrene showed a wide decline in the beginning of the fourth quarter, which may support the profitability of ABS units.
ABS unit operating rate:
In the third quarter of 2022, the average operating rate of domestic ABS petrochemical plants was 76.55%, down 10.23% from the second quarter, and down 17% from the third quarter of last year; the total domestic ABS production in the third quarter of 2022 was about 1.029 million tons, down from the second quarter. A decrease of 39,600 tons, a year-on-year decrease of 5,000 tons compared with the third quarter of last year. Due to the loss of profitability for a time, ABS petrochemical manufacturers have concentrated on reducing and shutting down production from June to July, resulting in a significant decline in the level of ABS construction. At the same time, in the third quarter, Liaoning Kingfa ABS plant was put into operation at low load, and the total ABS production capacity base increased.
Looking forward to the fourth quarter, except for some temporary maintenance plans for individual devices, ABS-related devices will basically maintain a high operating rate, and some new devices are expected to be put into production. The domestic production of ABS is expected to rise further in the fourth quarter.
ABS stock levels:
From the perspective of inventory, the domestic ABS finished product inventory level fluctuated between 127,500 and 178,000 tons in the third quarter of 2022. From June to July, ABS petrochemical manufacturers concentrated on reducing negative production, and the inventory level was low; superimposed on the rising ABS market in September, the orders of ABS petrochemical manufacturers increased, and the inventory gradually fell to a low level.
Looking forward to the fourth quarter, the maintenance plans of ABS petrochemical manufacturers will be significantly reduced, and some new plants are expected to be put into production, and the domestic supply of ABS is expected to increase. In addition, limited downstream demand performance is poor, speculative demand weakens, and social inventory may accumulate.
To sum up, the contradiction between supply and demand in the ABS market is still the key point. When the acceptance of buyers declines and the terminal enterprises are slow to digest, etc., the ABS spot market in the fourth quarter still cannot rule out the possibility that the market may fluctuate and decline, and all parties in the market still need to maintain a cautious attitude.
