Production Rose with Higher Prices

By Feng Shiliang of CPCIA   

In the first half of 2007, China's petroleum and chemical
industry remained up trend in production. Among the 65 types of
petrochemical products that have been tracked by CPCIA (China
Petroleum and Chemical Industry Association), the output of 63
types increased compared with the same period of 2006,
accounting for 96.9% of the total, and the output of 47 types,
in particular, grew by over 10%. Sales and trading were active,
and the prices climbed. Among 174 chemicals recorded, 107
chemicals had higher price than the same period of 2006.

Production

According to the statistics released by the National Bureau of
Statistics of China, in the first half of 2007, the total output
of crude oil reached 93.31 million tons, an increase of 1.7% over
the same period of 2006, and the output of natural gas rose 17.2%
to 33.13 billion m3.
    In the first half of 2007, 160 million tons of crude oil was
processed, an increase of 7% over the same period of 2006. The
output of gasoline and diesel increased considerably, of which
the output of gasoline was 29.802 million tons, a rise of 8% and
the output of diesel jumped by 6.2% to 60.65 million tons.
     In the first half of 2007, the output of chemical
fertilizers was 28.783 million tons, a rise of 12.3% compared
with the same period of 2006, among which the output of urea
reached 12.417 million tons, a rise of 14.1%. Pesticides output
was 856 thousand tons, an increase of 25.6% compared with the
same period of 2006. Among the pesticides, the growth of output
was 29.8% for herbicides, 11.2% for insecticides and 28.1% for
fungicides.
   The output of some inorganic materials increased
considerably in the first half of 2007. Among them, the growth
of output was 17.3% for caustic soda and 24.1% for calcium
carbide.
    Due to the expanded capacity, the output of the main organic
materials increased rapidly in the first half of 2007. The output
of ethylene, pure benzene and methanol, in particular, rose by
18.7%, 29.0% and 34.1% respectively over the same period of 2006.
    Due to the capacity expansion, the output of synthetic
resins increased by 19.5% to 14.917 million tons in the first
half of 2007, of which, the output of PE (polyethylene), PP
(polypropylene) and PVC (polyvinyl chloride) rose by 19.8%,
20.9% and 22.5% respectively. The output of synthetic rubber
gained as high as 14.2% to 1.086 million tons in the first half
of 2007, and the output of tires increased by 23.4%.

Prices

In the first half of 2007, the global crude oil price hovered
at high level, however, the price showed a slight drop compared
with the same period of 2006. Due to the price drop of crude oil
in domestic market, the performance of refineries improved
apparently. The prices of oil products saw a slight rise in
response to the tense supply in some local regions. China's
average market price of 90 octane number gasoline and 0# diesel
(condensed at zero degree centigrade) was RMB6 015/t and RMB5
454/t, a rise of 6.4% and 9.8% respectively over the same period
of 2006.
     Inorganic materials showed different price change
according to the strong or slack demand. In the first half of
2007, the average price of caustic soda (flake) and soda ash
increased by 12% and 3.5% respectively compared with the same
period of 2006, whereas the average price of sulfuric acid,
hydrochloric acid and nitric acid dropped by 10.7%, 8.8% and 1.7%
respectively.
    The prices of most organic materials showed up trend in the
first half of 2007. CPCIA reported that the average prices of
propylene, industrial naphthalene and pure benzene were RMB11
015/t, RMB9 442/t and RMB9 523/t, a rise of 12.3%, 41.1% and 30.9%
respectively over those in the same period of 2006.
    Due to the sufficient supply in the domestic market, the
prices of fertilizers remained basically stable in the first
half of 2007. The average price of urea was RMB1 790/t, basically
the same as that in the same period of 2006. The prices of
pesticides rose steadily, with the growth of prices being 6.3%
for dichlorvos and 5.7% for omethoate.
    The prices of synthetic resins increased slightly in the
first half of 2007 due to the brisk demand in downstream sectors.
The average prices of HDPE (high density polyethylene), LDPE
(low density polyethylene), PP and PVC were RMB12 438/t, RMB12
829/t, RMB11 951/t and RMB6 952/t respectively, a rise of 0.2%,
7%, 0.8% and 6.9% over those in the same period of 2006. Due to
the rapid price rise of styrene, the average price of PS
(polystyrene) saw the largest growth of 19.3% among the five main
kinds of general-purpose synthetic resins (PE, PP, PVC, PS and
ABS (acrylonitrile-butadiene-styrene)).
    The price of rubbers went down in the first half of 2007.
The average price of natural rubber was around RMB20 503/t, a
drop of 7.1% from the same period of 2006, and the price of
styrene-butadiene rubber and acrylonitrile-butadiene rubber
showed a decrease of 0.9% and 8% respectively.