In December, the butyl acetate market was guided by the cost. The price trend of butyl acetate in Jiangsu and Shandong was different, and the price difference between the two decreased significantly. On December 2, the price difference between the two was only 100 yuan/ton. In the short term, under the guidance of fundamentals and other factors, it is expected that the price difference between the two may return to a reasonable range.

As one of the main production areas of butyl acetate in China, Shandong has a relatively wide flow of goods. In addition to local self use, 30% – 40% of the output also flows to Jiangsu. The average price difference between Jiangsu and Shandong in 2022 will basically maintain an arbitrage space of 200-300 yuan/ton.

Since October, the theoretical production profit of butyl acetate in Shandong and Jiangsu has basically not exceeded 400 yuan/ton, of which Shandong is relatively low. In December, the overall production profit of butyl acetate decreased, including about 220 yuan/ton in Jiangsu and 150 yuan/ton in Shandong.

The difference in profits is mainly due to the difference in the price of n-butanol in the cost composition of the two places. The production of one ton of butyl acetate requires 0.52 tons of acetic acid and 0.64 tons of n-butanol, and the price of n-butanol is much higher than that of acetic acid, so n-butanol has a significant proportion in the production cost of butyl acetate.

Like butyl acetate, the price difference of n-butanol between Jiangsu and Shandong has been relatively stable for a long time. In recent years, due to the fluctuation of some n-butanol plants in Shandong Province and other factors, the inventory of plants in this area continues to be low and the price is high, which makes the theoretical production profit of butyl acetate in Shandong Province generally low, and the main manufacturers’ willingness to continue making profits and shipping is low and the price is relatively high.

Due to the difference in profits, the output of Shandong and Jiangsu is also different. In November, the total output of butyl acetate was 53300 tons, an increase of 8.6% month on month and 16.1% year on year.

In North China, the output was significantly reduced due to cost constraints. The total monthly output was about 8500 tons, down 34% month on month,

The output in East China was about 27000 tons, up 58% month on month.

Based on the obvious gap on the supply side, the enthusiasm of the two factories for shipment is also inconsistent.

In the later period, the overall change of n-butanol is not significant under the background of low inventory, the price of acetic acid may continue to decline, the cost pressure of butyl acetate may gradually weaken, and the supply of Shandong is expected to increase. Jiangsu is expected to reduce its supply due to the high construction load in the early stage and the major digestion in the near future. Under the above background, it is expected that the price difference between the two places will gradually return to the normal level.