Production Capacity Accounts For About 7% Of The National Hangzhou Di Kai Factory Fire, Dye Prices Will Rise?

Last year, the chain reaction of the Xiangshui explosion in Jiangsu triggered a market shock. Prices of various chemical products, including dyes, skyrocketed, and nearly 1000 enterprises stopped production. 9 months later, a fire accident occurred again in chemical industry in Jiangsu and Zhejiang provinces. A few days ago, a fire broke out in the workshop of Hangzhou Di Kai Co., which was located outside the six section of Qian Tang New District, Hangzhou, Zhejiang.

According to the China textile daily reporter, The company produces more than 40 thousand tons of disperse dyes annually, and is one of the main producers of dyestuff industry in China. 。 What impact will the accident have on the textile market? Will it lead to a new round of rectification and stop production? What will be the trend of dye prices in early 2020?

Will trigger a new round of shutdown?

Public information shows that Hangzhou Di Kai Chemical Co., Ltd. It is a Sino US joint venture located in Qian Tang River, Xiaoshan, Zhejiang. Founded in 1994, its registered capital is 24 million 820 thousand yuan, and its business scope is to produce organic chemical dyestuffs and intermediates. The company now has assets of more than 100 million yuan, with an area of 7 hectares, and employs more than 550 people. Its dye production accounts for about 7% of the total capacity of the dye industry in the country. 2017 annual report shows that during the period, the company's sales volume was more than 160 million yuan, net profit of nearly 24 million yuan, total assets of 130 million yuan. Compared with 2016, the sales volume of the company decreased slightly by 10 million yuan in 2017, but its net profit increased by more than 13 million yuan, and its growth rate was over 100%. The company's annual report did not disclose specific financial information in recent two years.

Official sources say The accident was caused by the fire of the warehouse of the 1.5 finished product of the company. Fortunately, there were not a large number of workers in the factory area. Only 4 workers in the company suffered minor injuries.

"Chemical enterprise safety first. If an explosion occurs and has a greater impact, it may lead to the safety check of the enterprises in the industrial clusters in the area where they are located. The accident is expected to have a certain impact on the dyestuff industry, but there will be no centralized shutdown, and it will hardly affect the operation of other dyestuffs factories. " Guotai Junan Futures analyst Ye Lewei Express.

Yide futures analyst Xing Binbin It is also considered that the scope of the impact is not great for the accident alone. Xing Binbin said that recently, Qian Tang New District Emergency Management Bureau, Public Security Bureau, fire brigade have jointly launched an accident investigation, and put up a counter three. But judging from the strict degree of environmental protection policy in recent years, there will be another round of investigation and stop production in 2020.

"The Xiangshui incident has caused serious casualties, and there are also serious security risks. Chemical market integration is imperative. The accident company is similar in nature to the company in Xiangshui and produces similar products. However, there was no casualties in the Hangzhou incident, and some enterprises had been on holiday during the Spring Festival. " Gold futures analyst Yu Pengsen Say.

What is the trend of dye prices?

There is no doubt that in recent years, the key words of dye and printing and dyeing industry are safety, environmental protection and price. Judging from the current situation, The possibility of large-scale production stop production is not high, but the subsequent increase in dye prices still attracts the attention of the industry.

Data show that Two In the first quarter of 019, the average price of interregional black ECT300% transactions was around 35 yuan / kg. At that time, the market participants were not optimistic about the price trend of dyes and intermediates, but with the explosion of Xiangshui in Jiangsu, the price of disperse dyes has soared. In April 2019, the price of scattered black ECT300% was over 50 yuan / kg, and the price of some orders reached 55 yuan / kg, even up to 60 yuan / kg, which reached a new high price in recent years.

What will be the trend of dye price in 2020 after this accident?

Yu said that Jiangsu and Zhejiang is an important textile and textile base in China. This accident is bound to have a greater impact on the printing and dyeing industry in China. The downstream raw material prices will go up, and its upstream products will face a more severe test. Now, the industry itself is in the off-season, short-term impact or not obvious, but the impact after the Spring Festival will gradually appear. He said: "After the downturn from the end of 2018 to the full year of 2019, the price of dyestuff industry has basically bottomed out, and there is still a limited space to continue to slump. At present, most products are on the verge of loss or loss. After experiencing this loss of reshuffle, some enterprises have withdrawn. Entering the first quarter of 2020, the market will improve, but the price of dye is still relatively limited. "

"The price of disperse dyes in the first quarter of 2020 is inevitable, but the impact of safety accidents and environmental pressures is relatively small. The price of dye depends mainly on supply and demand. " Jun Fang, Minister of information It is pointed out that at present, the main producers of disperse dyes such as Longsheng and run soil in Zhejiang are at a low level. As the price of disperse dyes dropped to historic lows in the fourth quarter of 2019, many traders and printing and dyeing enterprises increased their stocking volume, resulting in insufficient inventory of disperse dyestuff manufacturers. "As a manufacturing enterprise, in the case of production and marketing balance and even insufficient supply of goods, enterprises usually regulate demand through price means, and balance production and sales relationship. "

Juan Fang also said that the current cost of disperse dyes was higher than that in early 2019. The price of disperse dyes intermediate is higher than that of early 2019. For example, the price of two benzene amine at the beginning of last year was 45 thousand yuan / ton, the current price is 70 thousand yuan / ton, reducing the price at the beginning of last year is 40 thousand yuan / ton, the current price is 45 thousand yuan / ton, and the price of other disperse dyes intermediate is also higher than the price at the beginning of 2019. Enterprises' investment in safety and environmental protection is increasing, and the cost of energy and labor is increasing. "

In addition, Juan Fang also pointed out that many large disperse dye enterprises are listed companies, and medium-sized disperse dyes enterprises are mostly listed and listed companies and quasi listed companies have greater demands for profits. She predicted that: "According to the current price of disperse dyes, the profit of dyestuff enterprises will decline sharply in 2020, and the listed companies and quasi listed companies will face greater pressure of declining performance. Because the concentration of disperse dye industry is very high, the total market share of Longsheng and leap soil is about 60%. Industries with high concentration, especially large leading enterprises, have greater market pricing power. When facing downward pressure on performance, increasing profits through price increases is also a common decision-making behavior. It is suggested that the printing and dyeing enterprises be properly stocked before the Spring Festival. "

However, Juan Fang also said that after the Spring Festival, once the disperse dye production enterprises in Northern Jiangsu began to produce, they would contribute 100 thousand tons / year of production capacity. At that time, the price of disperse dyes is likely to peak and fall.