HMD Price Soaring leads to Shortage of HDI Market
2020-11-05    [Source:PUdaily]

1. Raw material hexanediamine(HMD) soars.

As the core raw material of HDI products, hexanediamine market is highly concentrated and monopolized by several giants. Recently, mainstream suppliers such as BASF and ASCEND have announced price increases, and INVISTA also adjusted price of new orders for month. ASCEND announced a chain of price hikes by $350/ton and $600/ton in October and November.

2. The main downstream of HMD - nylon 66 industry improves rapidly

The direct cause of price increases and shortage of HMD is resulted from its main downstream nylon 66. About 90% of HMD consumption goes into nylon 66 peryear in the world. In recent months, a good rebound has happened to the main downstream applications of nylon 66 - automotive industry. Moreover, other downstream fields like machinery and electronics industries keep booming. The spot price of nylon 66 is RMB 25,000-27,000/ton, compared with the low point RMB 18,000/ton during mid of the year, increasing more than 40% in less than a half year.

3. HDI series under pressure

As the main application of the remaining 10% HMD consumption, HDI series products are affected by the rising price and the squeezed supply volume. HDI manufacturers are under great pressure both in terms of cost and supply. Domestic mainstream suppliers Wanhua and Asahi have issued price increase letters one by another, and other suppliers also have made adjustment. Delays of order are widespread.

4. HDI downstream continues to warm up

HDI portfolio is widely applied in automotive, wood, industrial coatings. Among them, both automobile production and sales showing double-digit growth in China in September; and for the machinery field, it is estimated that the sales volume of excavators for the whole year is expected to increase more than 30% over the same period last year.

To sum up, combined with the current HMD supply and HDI demand situation, as well as the improvement of downstream coating industry, PUdaily analyst believes that at least in the coming six months, HDI series products will keep rising, and the supply tension will not be eased in a short period of time.

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