Double Digit Growth Continued     

By Feng Shiliang of CPCIA     

In August 2007, China's petroleum and chemical industry remained a rapid growth in production. Among the 65 petrochemical products that have been tracked by CPCIA (China Petroleum and Chemical Industry Association), 56 increased their output compared with the same period of 2006, and the output of 39 products, in particular, grew by over 10%. The output of natural gas, pure benzene and methanol increased rapidly. Local price of chemicals showed a flat increase. Among 159 chemicals recorded, 77 chemicals had higher prices than that in the preceding month. Due to the implementation of the new export rebate rates, the growth of export has decreased.

Production

In August 2007, crude oil output had an increase of 2.3% compared with August 2006 and the growth rate of natural gas output reached 24.98%.
    The production of fertilizers saw stable growth of 11.0%, among which the growth of potash was the largest, 39.96%. The output of insecticide and herbicide increased by 19.9% and 58.4% respectively while the Bactericide production declined by 6.1%.
   The output of pure benzene and methanol rose by 36.4% and 58.1% respectively compared with the same period of 2006 due to the brisk demand. Resins continued high growth. The output of cis-1,4-polybutadiene rubber decreased by 12.3%, impacted by other substitutive rubbers.  

Prices

In August 2007, due to the tense supply and the price rise of sulfur in the international market, sulfur price in Chinese market increased considerably. The average price of sulfur reached RMB1 910/t, a rise of 8.5% over a month before.
   The average price of sulfuric acid reached RMB560/t, a rise of RMB10/t over that in July 2007 due to the price rise of sulfur in domestic market. Because of the tense supply, the average price of calcium carbide reached RMB2 950/t, an increase of 5.36%.
   Organic materials showed different price change according to strong or slack demand. The prices of aromatic products including toluene, pure benzene and xylene came down, and the prices of alcohol products such as methanol, ethanol (ethyl alcohol), isopropanol and n-butanol changed differently. In August 2007, the average price of methanol reached RMB2 730/t, an increase of 9.2% over the preceding month, while the average price of ethanol dropped 2.6% to RMB4 700/t.
   Due to the oversupply in domestic market, the average prices of urea continued to decrease slightly to RMB1 765/t. The average prices of diammonium phosphate rose slightly to RMB2 600/t in response to the increase of production cost caused by considerable price rise of sulfur.
   In August 2007, due to the supply decrease, the average price of natural rubber (SCR5) rose slightly to RMB18 450/t. The prices of synthetic rubbers including styrene-butadiene rubber and cis-1, 4-polybutadiene rubber dropped 3.87% and 4.01% respectively compared with the preceding month.