Polyurethane Is In A Dilemma Of Cost Price Dislocation.

Rising costs and low demand are the plight of many enterprises in the polyurethane industry today.

Among them, the profits of MDI enterprises in the first half of this year have been greatly reduced, and propylene oxide enterprises have recently sold at a loss, all of which arise from the contradiction between production costs and market sales prices.

The coldness of the MDI market limits the continuing upward movement of aniline prices, which further limits the upward trend of crude oil costs in the upper reaches of aniline.

The downturn in downstream demand, the cancellation of preferential policies and the embargo on narcotics such as pure aniline during the Olympic Games directly restricted traders' enthusiasm for chemical trade.

As for propylene oxide, the price of crude oil and polypropylene has greatly affected the price of propylene, while the downstream market of PO has not changed due to the change of raw material prices. The continued cold demand makes propylene propylene even better in the case of rising costs.

According to the usual thinking, the increase of production cost will inevitably lead to the increase of the selling price of the products. However, the situation is different from the specific one to the polyurethane industry. Because the upstream raw materials are greatly influenced by the crude oil price, the market demand is difficult to control, and the products are mainly affected by the downstream demand, and the market becomes the leading factor of the product price.

For the part of the polyurethane industry that is in deep distress, the price and cost are difficult to synchronize, making it difficult for enterprises to maintain their products in the off-season. Reducing the operating rate is a common solution currently adopted by the market.