According to the Commodity Market Analysis System of Business Society, the domestic aggregated MDI market continued to rise in May. From May 1st to 31st, the domestic aggregated MDI market price increased from 16866 yuan/ton to 17516 yuan/ton, with a monthly price increase of 3.85% and a year-on-year price increase of 12.29%.

In the first half of the month, the domestic aggregated MDI market prices slowly moved upwards, with limited spot filling. Under the premise of low inventory, downstream demand followed suit, and the market supply was tight, driving up prices.

In mid month, the domestic aggregated MDI market rose, with limited spot filling and support from market demand orders, causing prices to rise again. The overall social inventory is low, and the supply side has strong support, slowly pushing forward. However, downstream acceptance of the current price has weakened, with digestion and follow-up being the main focus.

In the latter half of the month, the domestic aggregated MDI market remained at a high level of observation, with little change in supply and an increase in some shipments, continuing the pace of shipments. With the imminent shutdown of the MDI plant in Fujian and the force majeure of the Dow plant in North America on May 21st, the supply side is expected to shrink, coupled with the recent sustained low social inventory, the supply side remains tight and advancing.

On the supply side, the Shanghai BASF plant maintenance plan for mid May will last for about a month. North American Sci Tech device shutdown. The European Hungarian Borsod installation is beyond our control. The maintenance of the Dow device in Germany is expected to take around 45 days. North American BASF installation force majeure. On May 14th, the BASF plant in Shanghai was shut down for maintenance, lasting about a month. On May 21st, the Fujian plant experienced a short shutdown. The shrinking supply of production enterprises is influenced by favorable factors in the supply side.

On the cost side, raw material pure benzene: The domestic pure benzene market has seen a significant price increase, and the short-term supply tension in the market is difficult to change. At the end of the month, overseas factories caught fire, and the impact on pure benzene production is still uncertain. However, for the long-term scarce domestic pure benzene market, it still stimulates prices to continue to rise. As of May 31st, the benchmark price of pure benzene for Shengyishe is 9075.50 yuan/ton. Raw material aniline: Currently, the supply and demand logic of aniline in China continues to be weak. As of May 31st, the benchmark price of aniline in Shengyishe is 12142.50 yuan/ton. The cost side of MDI aggregation is influenced by favorable factors.

On the demand side, the downstream market slowly followed suit, rebounding after the price fell, and the buying atmosphere on the market improved, resulting in an increase in transaction volume. In recent times, the cold and formaldehyde free board industry has continued to follow up, while other industries have followed up slowly, and the overall market is driven by a strong trend. The short-term aggregate MDI demand side is influenced by favorable factors.

In the future market forecast, the downstream demand side has limited follow-up, the market is digesting the increase, and the supply side is maintaining its intention to boost. Business Society’s aggregated MDI analyst predicts that the domestic aggregated MDI market is mainly strong and following up.

According to the Commodity Market Analysis System of Shengyishe, the domestic TDI price continued to decline in May. At the beginning of the month, the average TDI market price was 15500 yuan/ton. On May 31, the TDI price was 15000 yuan/ton, and it was reduced by 500 yuan/ton within the month, with an overall decline of 3.23%.

In May, the TDI market was weak and consolidated. After the holiday, the TDI price weakened and decreased, mainly due to weak downstream demand and lack of favorable conditions on the market. In addition, the TDI factory equipment operated smoothly, and the supply of goods from suppliers was sufficient. The confidence in the trade market was insufficient, and cargo holders continuously lowered their quotations to promote shipment; In the middle and later half of the year, TDI prices showed a slight consolidation and increase. The terminal market had a strong demand for purchases, and downstream entry enthusiasm was not high. The market trading atmosphere was weak, and the trade market was mostly stable. The supply side was supportive of the market, and the market exploration was weak. Under the game of supply and demand, the TDI market remained stagnant.

The market situation of upstream toluene in May fell first and then rose. As of May 31st, the price was 7510 yuan/ton, a decrease of 100 yuan/ton from the beginning of the month’s price of 7610 yuan/ton, a decrease of 0.66%. The international crude oil price range fluctuates, and the cost support for toluene is weak; The production of xylene has decreased, and the demand for toluene has weakened; Port inventory has significantly decreased, supply pressure has eased, and toluene fluctuated during the month.

TDI data analyst from Business Society analyzed that currently, many TDI factories in China are operating smoothly. Although there are maintenance plans in the later stage, the transmission of supplier benefits is slow, downstream demand continues to be sluggish, market trading is weak, and confidence in the market is insufficient. Under the supply-demand game, it is expected that the short-term TDI market will remain stagnant, and specific attention will be paid to downstream follow-up.

Aluminum prices rose in May

Aluminum prices rose in May. According to the Commodity Market Analysis System of Business Society, as of May 31, 2024, the average price of domestic aluminum ingots in the East China market was 21256.67 yuan/ton, which was 20540 yuan/ton from the beginning of the month, and increased by 3.49% in a single month.

Rising prices of raw alumina

Affected by the news that Rio Tinto Group has announced that its Australian Yarwun smelters and Queensland Alumina Limited have experienced force majeure in alumina shipments, with prices skyrocketing due to shortages in natural gas inventory/supply for power generation, domestic raw material alumina prices have remained strong.

According to the commodity market analysis system of Shengyishe, as of May 31st, the average price of alumina in the market was 3983 yuan/ton, and on May 1st, the average price of alumina in the market was 3500 yuan/ton, an increase of 13.81% compared to the beginning of the month.

The rapid increase in alumina prices has provided strong cost support for aluminum ingot prices.

Positive policy support at the end of the month

On May 29th, the State Council issued the Action Plan for Energy Conservation and Carbon Reduction from 2024 to 2025 (hereinafter referred to as the Action Plan). The aluminum related parts are as follows:

Energy saving and carbon reduction actions in the non-ferrous metal industry

1. Optimize the layout of non-ferrous metal production capacity. Strictly implement the replacement of electrolytic aluminum production capacity, strictly control the new production capacity of copper, alumina and other smelting industries, and reasonably layout the new production capacity of industries such as silicon, lithium, and magnesium. Vigorously develop the recycled metal industry. By the end of 2025, the proportion of recycled metal supply will reach over 24%, and the proportion of aluminum water direct alloying will increase to over 90%.

2. Strictly increase the admission of non-ferrous metal projects. New and expanded electrolytic aluminum projects must reach the benchmark level of energy efficiency and A-level environmental performance. The energy efficiency of new and expanded alumina projects must reach the advanced value of mandatory energy consumption limit standards. The energy efficiency of new polycrystalline silicon and lithium battery positive and negative electrode projects must reach the industry’s advanced level.

3. Promote energy-saving and carbon reduction transformation in the non-ferrous metal industry. Promote advanced technologies such as efficient and stable aluminum electrolysis, continuous copper matte smelting, vertical reduction magnesium smelting, and large-scale ore furnace silicon production, and accelerate energy-saving and carbon reduction transformation in the non-ferrous metal industry. By the end of 2025, the proportion of production capacity above the energy efficiency benchmark level in the electrolytic aluminum industry will reach 30%, and the proportion of renewable energy usage will reach over 25%; The proportion of production capacity above the benchmark level of energy efficiency in copper, lead, and zinc smelting reaches 50%; The non-ferrous metal industry has completed technological transformation or phased out production capacity below the energy efficiency benchmark level. From 2024 to 2025, the energy-saving and carbon reduction transformation of the non-ferrous metal industry will result in an energy-saving amount of about 5 million tons of standard coal and a reduction of about 13 million tons of carbon dioxide.

Aluminum prices tend to fluctuate strongly in the future market

At present, there is not much explicit inventory of aluminum ingots in China, and the post holiday inventory situation is better than market expectations. There is expected to be an increase in supply, but due to the relatively high domestic aluminum prices, the import window is closed, and the surge in LME inventory has little impact on the domestic market. The inventory of aluminum ingots and rods in mainstream consumer areas has been slightly depleted, with good consumption expectations and a relatively balanced supply and demand in the short term; The cost side has recently received strong support, and the demand side is expected to improve. In the short term, it is expected that the market will experience strong fluctuations and operations.

According to the commodity market analysis system of Shengyishe, the domestic ammonium nitrate market price trend remained stable in May. As of the end of the month, the market price of ammonium nitrate was 3870 yuan/ton, which was the same as the price of 3870 yuan/ton at the beginning of the month, a year-on-year decrease of 3.97%.

In May, the price trend of domestic ammonium nitrate market remained stable, and the operation of domestic ammonium nitrate manufacturers was stable. Recently, the supply of goods on site was normal, and the downstream procurement situation was average. The market price of ammonium nitrate was mainly stable. Recently, downstream demand for nitro compound fertilizer has been average, and the purchasing atmosphere in the domestic downstream civil explosive industry has cooled down. Domestic ammonium nitrate manufacturers are operating normally, and the price of ammonium nitrate has been mainly fluctuating recently. As of the end of the month, the mainstream negotiation prices in Shaanxi region are 5300-5500 yuan/ton, Shandong region is 3600-3800 yuan/ton, and Hebei region is 3700-3800 yuan/ton.

In May, the domestic price trend of concentrated nitric acid slightly declined, with an average price of 1830 yuan/ton as of the end of the month, a decrease of 1.44% from the initial price of 1856.67 yuan/ton. Mainstream enterprises in East China offer a price range of 1800-1900 yuan/ton, while those in the North and Central China offer a price range of 1800-2000 yuan/ton. At present, the supply side of the concentrated nitric acid market is normal, with a slight increase in cost trends. The market mainly relies on orders, and the transaction situation is not good. Industry insiders are mostly wait-and-see, and the on-site price of nitric acid has slightly decreased. As a result, the price of ammonium nitrate in the market has not changed much.

The price of upstream liquid ammonia slightly increased in May, with a price of 3100 yuan/ton as of the end of the month, an increase of 3.91% compared to the price of 2983.33 yuan/ton at the beginning of the month. In early May, some equipment underwent maintenance, and the supply side was relatively tight. Coupled with active downstream urea production, the amount of ammonia released decreased. And downstream procurement enthusiasm is high, agricultural demand procurement is still acceptable, industrial demand remains in demand, and the trend of the liquid ammonia market is on the rise. At present, the mainstream quotation in Shandong region is between 3050-3150 yuan/ton, and the market price of ammonium nitrate is stable due to the impact of rising costs.

Recently, the downstream civil explosive industry’s procurement has come to an end, and the demand for nitro compound fertilizer is average. The price trend of nitric acid has declined, and the liquid ammonia market in May has slightly increased. The positive and negative factors are shared, and the ammonium nitrate analyst from Business Society believes that the market price of ammonium nitrate may slightly decrease.

The price of boric acid has been weak and stable recently. According to the Commodity Market Analysis System of Business Society, as of May 29th, the average price of boric acid in the domestic market is 7275 yuan/ton. At present, domestic boric acid traders offer prices ranging from 6700 to 7800 yuan/ton (actual transaction prices for different brands, specifications, and products are mainly negotiated), with mainstream prices ranging from 6900 to 6950 yuan/ton based on sales volume.

In terms of overseas imported goods, the current foreign quotation for imported goods is concentrated at 7500-7800 yuan/ton (the actual transaction price of different brands, specifications, and products is mainly negotiated). According to the Commodity Market Analysis System of Business Society, the average market price of imported boric acid is 7618.75 yuan/ton, a decrease of 0.08% compared to the market average price of 7624 yuan/ton in early May

The price of boric acid began to decline from its high point in June 2022, and began to bottom out and fluctuate horizontally in May 2023. Currently, it is still operating in the range of bottom box fluctuations. If there is no positive news, it is expected to be difficult to change in the short term.