New crown pneumonia in Japan, South Korea, and Singapore has spread further, and watchful efforts and even the Asian chemical market need to be vigilant! If the epidemic spreads, the Asian chemical market will face great challenges

If Japan, South Korea and Singapore, three relatively developed countries in Asia, the outbreak of the new crown pneumonia outbreak, it will pose a great challenge to the chemical market in Asia and even the world.

First of all, Japan, South Korea and Singapore are all strong chemical producers, and Singapore is the world's third largest refining center. If the outbreak affects chemical production, it will have a significant impact on the general chemical market in Asia alone, and it will be a disaster for the specialty chemical market. For example, in Japan last year, Japan restricted its exports of three types of high-end electronic materials, which caused a heavy blow to the Korean semiconductor industry, which fully illustrates Japan's industrial chain advantages in high-end materials. If the Japanese chemical industry encounters a crisis due to the epidemic, important downstream industries of specialty chemicals, such as the semiconductor industry, aircraft manufacturing, and automobile industry, will have a significant impact or even be paralyzed.

Secondly, Japan, South Korea and Singapore are all important chemical consumer countries. If the epidemic causes market consumption to shrink, chemical companies in the three countries will definitely have a hard time. In 2019, due to global economic uncertainty and shrinking international market prices, chemical companies in Japan and South Korea generally saw a decline in net profit. As these chemical companies plan to improve their situation in 2020, the epidemic of new crown pneumonia directly caused a further downturn in the international chemical product market. Since the outbreak of China, the market price of ethylene in Northeast Asia has dropped from US $ 835 / ton on January 21 to US $ 705 / ton on February 20 (both CFR). For Japanese and South Korean chemical companies that are suffering from shrinking chemical prices, the current situation is worse. If the local market shrinks again, it will no longer be a worse situation that can be described as worse.

Finally, Singapore is an important trading hub for petrochemical products in Asia and the world, as well as a gathering place for chemical market information and services. If the outbreak in Singapore would cause extremely significant losses to the chemical trade and services throughout Asia, the business activities of enterprises would face even more severe challenges.

Prevent weak market shocks

Regarding the surfactant market, recently, the resumption of resumption of production in various provinces and cities in China has gradually increased, and logistics is also recovering. However, due to the difficulty of returning to work in other provinces, the control of logistics, and the lack of protective substances, the rate of resumption of recovery is still There are difficulties. Surface active upstream raw material ethylene oxide has a low operating rate in the past two weeks. Many companies have ceased production, and inventory pressure is high. Most companies are in a regional destocking situation. For surface active production enterprises, production staff are not in place. Raw materials can't come in, coupled with the mediocre downstream demand, the operating rate is low; many manufacturers of polycarboxylic acid water reducer monomers are currently destocking by stopping and reducing prices.

A large part of the surfactant products are petroleum-based and most of the high-end surfactants are imported. Japan, South Korea, Singapore, etc. are all major exporters of surfactants in China. With the overcapacity of domestic production and the impact of the domestic epidemic, the market outlook may be vigilant to prevent a new round of weak markets!