Metallurgy / Chemicals / Rubber & Plastics

On July 20, severe rains were encountered in many parts of Henan. Affected by continuous heavy rainfall, the water level of many rivers in Henan has risen, and many reservoirs have exceeded the flood limit water level, causing disasters such as waterlogging, farmland waterlogging, and flooding in many cities.

Especially in Zhengzhou City, the rainfall reached 201.9 mm in one hour. It can be said that it rained nearly half a year in Beijing in this hour! As for the polyolefin industry, how much impact will the flood caused by this heavy rain have?

From the perspective of the supply side, Henan Province currently has Sinopec’s Zhongyuan Petrochemical and Luoyang Petrochemical units located in Puyang and Luoyang, respectively. Zhongyuan Petrochemical has 260,000 tons of PE capacity and 280,000 tons of PP capacity. Luoyang Petrochemical has a PP production capacity of 160,000 tons. Judging from the areas with concentrated rainfall, Puyang and Luoyang were relatively less affected, and the flood did not affect the normal driving of the above two sets of devices.

As for the large number of emergency materials that the market is more concerned about, especially the increase in demand for woven bags, will it affect the prices of upstream PP and PE?

According to my country's "Acceptance Standards for Flood Control Reserve Materials" (SL297-2004), flood control materials include 11 types of flood control woven bags, flood control geotextiles, flood control composite geomembranes, and flood control needle-punched composite geotextiles. And the specifications and quality standards of various materials are clearly stipulated.

Taking flood control woven bags as an example, according to regulations, the quality of flood control woven bags is 80-100 grams. It is estimated that the raw material polypropylene (PP) required for 1 million flood control woven bags is about 80-100 tons.

Looking at the flood control geotextile, according to the different substrates, the flood control composite geomembrane also has different standards:

(1) When the base material is a plastic woven geotextile, the polyethylene (PE) or polypropylene (PP) required for a composite membrane of 10,000 square meters is about 0.8-1.6 tons.

(2) When the base material is staple fiber needle-punched non-woven geotextile, the raw material required for the composite membrane of 10,000 square meters is about 5-8 tons.

According to the current domestic production capacity of related products, the daily output of polyethylene (PE) is about 65,000 tons; the daily output of polypropylene (PP) is about 90,000 tons, of which the PP drawing material used to make woven bags The output accounts for about 1/3 of the total PP output, which is 30,000 tons; the single-day production capacity of staple fiber is about 18,000 tons.

Therefore, from the perspective of the demand for flood control and emergency materials alone, the quantity of required raw materials accounts for a very low proportion of the supply, and the current industrial production capacity can easily meet the demand for flood control and emergency.