Since the second quarter, the prices of many chemical products have risen wildly. Some selling prices even hit a record high. Sulfur yellow rose by as much as 700%, which is considered the highest price increase in the chemical market. Second, the most representative is concentrated nitric acid. Concentrated nitric acid prices have seen a rare price increase trend in history. How did this unprecedented market trend happen? How will the market develop in the future? Through the analysis in this article, you can feel the trend of the whole chemical market and the whole Chinese economy since this year.

Market Price Trends

This year’s nitric acid market is very special, with high sales volume in the off-season. In the history of China’s nitric acid market, there was only one time in the SARS period in 2003. But such a high price and such a violent rise have never been seen before in history. At present, the domestic nitric acid price has been hovering at the historical high level for 2-3 months. It is estimated that it will not come down for the time being in July and August, because the output of nitric acid plant in summer is less and the supply gap is expanding continuously.

In the past two years, the prices of many chemical products have been rising, and only the price of nitric acid has fallen. The price of concentrated nitric acid has changed the historical pattern of 10 to 50 RMB/ton increase. Now a rise is the price of 200 to 300 RMB/ton. And every 3 to 5 days to rise. The highest monthly increase of up to 1000 RMB/ ton. From 1600 RMB/ ton up to a record high of 2100 RMB/ ton. And this same price span in 2008 took only one month.

The current price of concentrated nitric acid has reached 4200 to 4300 RMB/ton. This is an increase of 300%.

After June, although the whole domestic concentrated nitric acid market still has a large gap between supply and demand, the market price has slowed down significantly.

The price of concentrated nitric acid in the second quarter of the country really rises faster. It is mainly the transmission of industrial chain pressure caused by inflation.

Firstly, the rising cost of raw materials has squeezed the profit and living space of concentrated nitric acid. The only way to pass on the cost of concentrated nitric acid is to raise the price. As a result, the downstream profit margin is squeezed.

In order to survive, downstream enterprises can only pass down the cost pressure by raising prices again. The whole industry chain is thus passed on to the squeeze layer by layer.

Pressure in the industry chain to pass, the end of the industry will eventually have nowhere to transfer costs. Can not bear the cost of the enterprise can only shut down production.

Once the terminal industry of the chain has this crisis, it will be passed upstream through the same industry chain in reverse, until the nitric acid and ammonia industry.

The domestic market price of concentrated nitric acid should still be hovering at a high level in July and August. At least the price will not come down in July.

The production of toluene and pure benzene products is restricted by the environmental protection policy.

Without pure benzene, aniline cannot be produced. Without toluene, nitrobenzene, trinitrotoluene and dye intermediates can’t be produced. Aniline, nitrobenzene, trinitrotoluene can not be produced, will inevitably affect the purchase of nitric acid.

But this is only a short-term impact on local areas. From the long-term and national situation, the supply and demand situation of nitric acid market will not change fundamentally before October.

The causes of price increase will also be reflected in the following four aspects.

First, the cost of production. Coal, electricity, water and gas are all increasing in price.
Second is the transportation cost. Diesel and gasoline price increases lead to the transportation price of nitric acid also followed. And these price increase factors are irreversible, once up it is impossible to come down again, only higher and higher.
Thirdly, the factor of electricity restriction and production reduction. Although the local government has subsidies for power plants, but it is only a drop in the bucket. And can not solve the fundamental problem.
Fourthly, July, August and September are high temperature and rainy seasons. Variable factors, the production of nitric acid is not conducive.

These effects will inevitably cause a reduction in the supply of total domestic commodities.

Due to the stimulation of the high price of concentrated nitric acid, the production enthusiasm of the manufacturers was mobilized as never before.

Excluding the role of non-controllable factors, such as unexpected breakdown of production units, natural disasters, transportation disruptions, shortage of raw material supply, etc. Almost all the nitric acid enterprises are doing their best to increase their production capacity.

Nitric acid

Nitric acid manufacturers have been making serious losses after two or three years of sustained market weakness. Once the seller’s market was formed, the moribund nitric acid enterprises were eager to raise the ex-factory product prices to recover their strength and make up for the long-standing operating hole. After two months of rapid price rises in April and May, domestic nitric acid companies quickly recovered better.

Nitric acid is a strong oxidizing and corrosive mono-inorganic acid, and is one of the six strong inorganic acids. Nitric acid is also an important chemical material. Its chemical formula is HNO3, and its molecular weight is 63.01. Its aqueous solution is commonly known as nitric acid water or ammonia nitrogen water.

In industry, it is used to make fertilizers, pesticides, explosives and dyes. In organic chemistry, the mixture of concentrated nitric acid and concentrated sulfuric acid is an important nitrification reagent. The hazard symbols of affiliation are O (Oxidizing agent oxidizing agent) and C (Corrosive corrosive product). The anhydride of nitric acid is dinitrogen pentoxide (N2O5).

Pure nitric acid is a colorless and transparent liquid. Concentrated nitric acid is a light yellow liquid (dissolved with nitrogen dioxide). Under normal conditions, it is a colorless and transparent liquid. It has an asphyxiating and irritating odor.

The content of concentrated nitric acid is about 68%. Easily evaporates. Produces a white mist in the air (same as concentrated hydrochloric acid). These white mists are small droplets of nitric acid formed by the combination of nitric acid vapor (generally nitrogen dioxide from the decomposition of concentrated nitric acid) and water vapor.

Concentrated nitric acid is miscible with water. Can form azeotropic mixtures with water. Relative density 1.50 (anhydrous), melting point -42°C (anhydrous), boiling point 83°C (anhydrous). For dilute nitric acid, the boundary between concentrated and dilute is generally considered to be 6 mol/L. The concentration of commercially available common reagent grade nitric acid is about 68%. The concentration of industrial grade concentrated nitric acid is 98%. Usually the concentration of fuming nitric acid is about 98%.

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