Phenols Market Overview in 2023 In Q1, the phenol and acetone (phenol by-product) market saw the sluggish downstream demand due to the economy, coupled with an additional capacity of 0.6 million tons from China in early 2023. This caused the phenol and acetone supply to increase and led to a dip in prices, prompting many manufacturers to announce production control. In Q3, the market was positively impacted by turnarounds among phenol producers in Asia, shrinking the phenol and acetone supply and driving up the prices. However, in Q4, the additional capacity of 1.3 million tons per year from China pushed up the phenol supply, causing the price to fall again. As a result of these factors combined, the average phenol price in 2023 was US$ 978 per ton, representing a US$ 331 per ton decline compared to 2022, while the phenol-benzene spread was US$ 80 per ton, decreasing by US$ 201 per ton relative to the year before. The average acetone price in 2023 was US$ 762 per ton, a surge of US$ 65 per ton from 2022. The bisphenol A (BPA) market was likewise pressured due to a drop in demand for polycarbonate and epoxy resin products driven by the economic slowdown, coupled with China’s additional production capacity of 1.7 million tons per year. Consequently, BPA prices saw a significant decline, dropping by US$ 585 per ton to US$ 1,272 per ton relative to 2022, while the BPA-phenol spread was US$ 294 per ton, falling by US$ 254 per ton compared to 2022. Market Forecast for 2024 For the phenol market in 2024, demand for phenols, acetone, and BPA is expected to remain depressed by the ongoing economic slowdown in the first half of the year and gradually improve in the latter half due to China’s economic stimulus package. However, there will continue to be new capacities in China, with an additional 1.1 million tons per year for phenols, 0.7 million tons per year for acetone, and 1.7 million tons per year for BPA, putting pressure on phenols and causing the price spreads for phenol products in 2024 to decline slightly relative to 2023. Other Intermediates Market Overview in 2023 The purified terephthalic acid (PTA) market in 2023 saw a recovery rate of under 3%, lower than the expected 4-5% range. This could be attributed to China’s economic condition, which experienced a slowdown and fell short of targets. In addition, exports to destination countries in Europe and the United States grew at a reduced rate after policy interest rates were increased to stanch inflation, while new capacities exceeded 10 million tons per year. As a result, the average price of PTA fell US$ 66 per ton to US$ 779 per ton, while the price spread slid almost US$ 200 per ton to US$ 84 per ton compared to 2022. The propylene oxide (PO) market in Q1-2/2023 was adversely affected by sluggish demand driven by the economic outlook and capacity expansion, especially in China, which brought on an additional 1 million tons per year in output, or 7% of the world’s total capacity. As a result, PO prices fell, while the price spreads remained low, prompting manufacturers in Asia to ramp down production to control output. In Q3-4, the demand level did not show a significant rebound, while a new production capacity of 0.7 million tons per year in total was introduced as commercial operations in China were postponed to Q4. Consequently, the average PO price in Asia in 2023 slipped to US$ 1,053 per ton. The acrylonitrile (AN) market in 2023 continued to experience a slump, with the demand standing at approximately 6.2 million tons, showing a 1.1% growth rate, close to the 2022 level. The demand for downstream products, such as acrylonitrile butadiene styrene (ABS), acrylic fiber (AF), and acrylonitrile butadiene rubber latex (NBL), still did not improve due to the ongoing economic slowdown and tight monetary policies designed to control inflation rates. On the other hand, the supply grew to 8.9 million tons, driven by added production capacities, with the majority coming from Chinese manufacturers in response to the government’s self-sufficiency policy. As a result of the surplus supply pushed onto the market, the prices were continuously depressed, decreasing profitability among manufacturers in Asia and prompting them to announce production cuts. The average production 71 PTT GLOBAL CHEMICAL PUBLIC COMPANY LIMITED Form 56-1 One Report 2023
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