Chinese enterprises by virtue of large-scale manufacturing, industrial chain coordination and engineering optimization capabilities, In the vast majority of chemicals compared with overseas have a cost advantage, this point has become the consensus of investors. However, in recent years, under the inflation trend, China's inflation has been properly controlled, and the cost advantage of raw materials represented by coal is prominent compared with the cost of overseas oil and gas. In fact, the cost curve of China's foreign chemicals has been reconstructed under the sharply differentiated cost of energy and resources.
By tracking the prices of major chemicals in China, Europe and the United States since 2019, we find that the price difference between home and abroad has widened significantly, especially since the Russia-Ukraine conflict in 2022. The price difference between European chemicals and Chinese chemicals has further widened, and the European market price of chemicals represented by adipic acid, caustic soda and acetic acid has reached more than twice that of China. In this context, we need to focus on the export arbitrage space of China's chemicals. From the monthly import and export data, there is indeed a trend of decreasing import dependence and increasing export volume. If we take into account the high sea freight in 2021, this year, on the one hand, the price gap will further widen, on the other hand, the sea freight will decline, and China's resumption of production and work will also solve the transportation problems of the supply chain, and chemical exports in the second half of the year may have a stronger performance. This is also an important reason why we are not pessimistic about the profit of chemical products in the second half of the year. As of June 5, the chemical price gap at home and abroad: The Top chemical price gap between China and Europe includes: Epoxy resin, adipic acid ($2,307.5 / ton), PA66(injection molding)($1,076.4 / ton), caprolactam ($1,531.7 / ton), PA6(injection molding)($1,508.7 / ton), TDI($1,433.0 / ton), etc. Increase in the price difference of chemical products at home and abroad: Compared with the beginning of 2022, the TOP3 chemical price increases in China and Europe are PA66(injection molding)(+2338.9 US dollars/ton), PA6(injection molding)(+ 599.8 US dollars/ton), toluene (+527.5 US dollars/ton); The TOP3 chemical price growth in China and the United States were vinyl acetate monomer (+2623.6 US dollars/ton), PA66(injection molding)(+2242.1 US dollars/ton) and silicon metal (+2098.4 US dollars/ton). Compared to the same period in 2019, The TOP3 growth in the price spread of chemical products in China and Europe were epoxy resin (solid)(+ 2,342.4 US dollars/ton), PA66(injection molding)(+ 1,397.8 US dollars/ton), PA6(injection molding)(+ 1,358.5 US dollars/ton); The TOP3 chemical price growth in China and the United States were epoxy resin (solid)(+4439.6 US dollars/ton), MDI(+1838.2 US dollars/ton) and n-butanol (+1124.6 US dollars/ton). China's chemical imports and exports in April: The chemicals with significant export volume growth include: adipic acid, toluene, PS, PVC, styrene, soda ash, acetic acid, acrylonitrile, HDPE, LLDPE, PTA, liquid alkali, etc. The chemicals whose import dependence decreased significantly included: styrene, toluene, HDPE, LLDPE, caprolactam, octanol, ethylene, ethylene glycol, propylene, etc.
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