Commodity index: the polyaluminum chloride commodity index on June 29 was 95.57, which was the same as yesterday, decreased by 12.33% compared with 109.01 points (August 28, 2019), the highest point in the cycle, and increased by 13.34% compared with 84.32 points, the lowest point on August 18, 2020（ Note: period refers to from April 1, 2019 to now)

It is found that the market of solid (industrial grade, content ≥ 28%) polyaluminum chloride in China’s domestic market has shown a trend of short-term rise, then decline and continued to weaken since the commencement of construction in 2021. On February 18, the domestic mainstream price was 1791.67 yuan / ton, while on March 30, the mainstream price was 1718.57 yuan / ton, down by about 4.18%; In April, the mainstream market of polyaluminum chloride in Henan Province of China fluctuated slightly, with an amplitude of less than 1%, with little change. By April 29, the mainstream quotation was 1717.14 yuan / ton, so far, the overall decline was 4.16%. In May, the market of China’s (industrial grade, content ≥ 28%) solid polyaluminum chloride showed a fluctuating upward trend in the early stage, and then decreased at the end of the month: the domestic mainstream price was 1720 yuan / ton on the 1st, 1756.67 yuan / ton on the 30th, and 1723.33 yuan / ton on the 31st. Among them, the main influencing factor is the change of raw material price. In June, the price of China’s (industrial grade, content ≥ 28%) solid polyaluminum chloride fluctuated slightly. At the end of the month, the raw material hydrochloric acid was under control, and the polyaluminum chloride manufacturers also stopped production for about a week. The market price did not change much, with 1710 yuan / ton on the 1st and 1723.33 yuan / ton on the 29th, with an adjustment rate of only 0.78%.

Industrial chain: in terms of upstream raw materials, hydrochloric acid: according to the data of business society, the overall market of hydrochloric acid manufacturers showed a fluctuating downward trend in February, but in the nearly half month after the Spring Festival, hydrochloric acid experienced a rise of about 4%, and then recovered by about 10%. In March, the trend of hydrochloric acid in North China fluctuated and rose. On March 1, the mainstream market quotation was about 172 yuan / ton, and on March 30, it was about 197.5 yuan / ton, with a monthly increase of nearly 15%. The upstream liquid chlorine market rose by 17% this month, with strong cost support. The maintenance of downstream enterprises of hydrochloric acid increased, and the demand decreased. The hydrochloric acid supply enterprises had more inventory, the downstream purchasing enthusiasm was general, and the market supply exceeded the demand. The support of downstream silica is relatively low, and the monthly price fluctuation is no more than 1%. The support of ammonium chloride is strong, and the monthly rise is 14%. The downstream demand of “Jinshan” hydrochloric acid is gradually increasing, resulting in the fluctuation of hydrochloric acid up about 15% this month. In April, the trend of hydrochloric acid in North China was volatile and downward: on April 1, the mainstream market quotation was about 243.33 yuan / ton, and on April 29, it was about 226.67 yuan / ton, with a monthly decrease of about 6.85%. In May, the trend of hydrochloric acid in North China showed a slight upward trend. On the 1st, the mainstream market quotation was 226.67 yuan / ton. On the 17th, the price of hydrochloric acid mixture in Shandong increased by 6.66 yuan / ton, or 2.94%. After that, the price temporarily stabilized around 223.33 yuan / ton. In June, the trend of hydrochloric acid in North China was volatile and stable after upward adjustment, with the mainstream quotation of 223.33 yuan / ton on the 1st and 230 yuan / ton on the 29th, up 2.99%. Calcium powder: according to the manufacturers in the main production area, in the first half of the year, the price of calcium powder also increased significantly after the Spring Festival, followed by the price increase in May, and the current price is relatively stable.

Secondly, LNG is used in the production process. In February, due to many negative factors such as weak demand, sufficient supply, superimposed feed gas, and declining cost support, the shipment of liquid plants was under pressure, and the domestic LNG market fell by more than 30%. In March, the price of gas source rose, which boosted the market sentiment, added up with the downstream replenishment before the festival, and the low operation of some manufacturers’ devices in some areas, which jointly boosted the rise of liquid price, with a range of up to 30% in that month. In April, the heating period in northern China ended, and the market officially entered the off-season. The supporting force of demand side gradually declined, and the favorable factors such as early maintenance were exhausted. Due to the weak demand, the LNG market was down, with a monthly decline of about 16%. After the May holiday, the restrictions on the transportation of high-speed dangerous chemicals were lifted, the demand for vehicles increased after the holiday, the maintenance of superimposed liquid plants increased, the supply was tightened, the inventory of enterprises was low, and the price of imported gas rose. Driven by this, the domestic liquid price rose in a straight line. The overall trend was up down up, with a monthly increase of 46%. It performed well in the off-season of consumption. During the Dragon Boat Festival, the price of downstream replenishment and raw gas rose, and the liquid market ushered in a wave of rising trend. This month’s market showed four stages of fall rise fall rise rise. The rise and fall of the whole month were almost offset from 3626 yuan / ton at the beginning of the month to 3666 yuan / ton at the end of the month. With the positive attitude of manufacturers in supporting prices at the end of June, and under the psychology of buying up but not buying down, the market trading atmosphere has improved. It is expected that with the reduction of bidding in July to boost the market sentiment, the industry’s wait-and-see attitude will remain unchanged.

Downstream demand: in the first half of this year, the downstream demand of polyaluminum chloride has not improved greatly. According to the enterprises, the overall demand from 2021 to now is average, coupled with environmental protection inspection, the enterprises are under great pressure, and the downstream demand is generally not as good as that in 2020. At the end of June, after receiving the production limit notice from yingqiyi environmental protection company, the company will stop production until the beginning of next month, which is expected to take about a week. In the current demand, if the inventory is not affected, the price will not have great support.

Future forecast: according to the situation reflected by the manufacturers, the downstream demand of polyaluminum chloride is general in 2021. Although it has stopped production from time to time, the inventory is sufficient, and the change of raw material cost is relatively weak. The LNG for production will be affected by the crude oil price, supported by the supply side and cost side, and the favorable bidding in July, which may boost the market sentiment, But the impact on the current market of water treatment products is not obvious. To sum up, in the first half of the year, the market of polyaluminum chloride basically fluctuated in a small range. In the third quarter, if the transportation control time of hydrochloric acid is long and the raw material cost price rises, then we can’t rule out the rising market. At present, it seems that the market will be stable, even if there are fluctuations, it will be adjusted in a small range.