Shanghai Secco Big Explosion, 6 Deaths, PE, PP Prices Have Soared?

Shanghai Secco Petrochemical Co., Ltd. issued an accident report saying:

At around 15:25 in the afternoon on May 12, Shanghai Aijinke Engineering Construction Service Co., Ltd. had an accident during the maintenance of the storage tanks in our company.

Shanghai Secco has a design capacity of 1.09 million tons per year ethylene cracking, which is currently one of the largest single-line ethylene plants in the world, and the remaining seven devices have also reached the world scale: 650,000 tons/year of styrene, 600,000 tons /Year aromatic extraction, 520,000 tons/year acrylonitrile, 180,000 tons/year butadiene extraction, 600,000 tons/year polyethylene, 300,000 tons/year polystyrene, 250,000 tons/year polypropylene, etc. Large chemical plant. Among them, there are mainly 600,000 tons/year of polyethylene and 250,000 tons/year of polypropylene equipment for futures trading.

Is this incident most concerned by the current market causing suspension of production and how long will it stop production?

According to the severity of the accident, the company's accident time caused by chemical company accidents is not the same. For example, a PVC production enterprise in Xinjiang had a production accident in the early stage, causing casualties and the production shutdown period lasted for several months. Of course, the company once again suffered a production accident soon afterwards and the company had stopped production for nearly a year. “

Shanghai Secco suffered casualties in this accident and counted major accidents. Therefore, the suspension of production and investigation in the previous period is unavoidable. However, because the device is only a storage tank, and there is a problem in the overhaul, no major damage has been caused to the core production equipment of the production area. Therefore, as long as the company obtains the permission of the superior production, it can immediately resume production. ”

According to past experience, this accident may cause the company to suspend production for a period of between 2-3 months, and may even be shorter. "Then according to this hypothesis, the output of domestic PE will fall by 150,000 tons, and the output of PP will drop by 62,500 tons, which can be compensated by the current inventory level."

In March, the output and imports of PE all increased. The total supply has climbed to the historical peak. The port inventory is also at the same period of the previous year. The pressure on domestic PE stocks is relatively high, and the abundant supply of goods on the market will restrain the rebound of the market. And continuity.

In the January-January period of 2018, the cumulative domestic PP production was 5.315 million tons, which was 4.842 million tons more than that of the previous year, an increase of 9.53%, and the supply side was relatively well-off compared to the previous period:

Overall, Shanghai Secco's production capacity is relatively small in the polyolefin industry. 
Dong Li, who is responsible for the energyization of Minmetals Industrial Financial Services, said that from the perspective of safety accidents, this is a relatively large production safety accident accident/risk accident, and the safety production management and rectification activities caused by hindsight are relatively speaking. There may be a greater level of impact. However, if the cause of the accident is due to improper operation of external maintenance personnel, the situation with Ningbo Mitsubishi last year should not have much impact on specific production.” According to him, currently , Secco's PS and SM devices are in normal operation. 
In summary, the Shanghai Secco incident has little effect on the overall supply of polyolefins, and short-term social inventories are still relatively sufficient, and the amount of maintenance losses will gradually decrease in the near future. It is expected that the number of imported polyolefins in Hong Kong will increase in May. To increase the overall demand for polyolefins in May!