Overall Rabi sowing is down by ~5% YoY, mainly led by 5% decline in wheat and ~9% for pulses. Reservoir levels in South India are at a large deficit to average levels - which could impact the ongoing sowing patterns during Rabi. Fertiliser prices remained stable MoM, except for Sulphur that started to recover and was up 24%. Crude oil declined 9% MoM, which led to a decline in aromatics prices. There has been recovery in the spreads of Caprolactum, P-Cresol, PVC, BOPET on the back of decline in RM costs, while phenol spreads declined MoM due to decline in phenol and acetone.
Fall in crude oil:
Over the last month, crude oil has declined ~9%, which led to 4%/7% decline in Benzene and Toluene prices. Olefins prices remained flat. Prices of acetic acid, soda ash and methanol declined MoM; while bromine and TDI prices rose. Price of caustic soda and PVC largely remained flat. Phenol spreads declined ~20% to CNY3,910/tn, on the back of 8%/9% fall in phenol and acetone each. Post a steep decline in TAN spreads, they stayed stable MoM at US$96/tn.
Recovery in spreads of certain chemicals:
Spreads of Atul products such as P-cresol, Resorcinol and 2,4-D witnessed recovery in spreads. P-Cresol spreads increased by 26% MoM to Rs137/kg, due to sharp decline in Toluene; while 2,4-D prices were up 8% due to recovery. BOPET spreads recovered 8% to Rs47/kg due to increase in BOPET prices. NTCF too, witnessed increase in spreads due to a sharp jump in NTCF prices. PVC-VCM spreads were up 18%; while caprolactum-benzene spreads were up 23%.
Int’l fertiliser input prices remained stable:
Prices of key inputs viz. ammonia and phosphoric acid remained flat MoM. Fertilisers like DAP remained flat MoM, while urea declined 6%. Sulphur prices have started to recover and were up 24% MoM. Global
Agriculture update:
Nov'23 witnessed 9%/5% rise in rice and soybean prices, while corn and cotton declined 5% each; as USDA increased production estimates. Brazil corn prices increased by 28% MoM, as China redirected imports from USA to Brazil. USDA has increased global corn production forecast by ~0.5% in Nov’23. Global corn production is now expected to increase 5.5% YoY.
Rabi sowing and rainfall update:
Rabi acreages are currently ~5% below last-year levels. Wheat sowing was down 5%; pulses sowing declined 9%. Oilseeds remained flat. Season-to-date rainfall (since 1- Oct-23) is ~20% below normal; reservoir levels are below last-year levels.
Other highlights:
1) Tata Chemicals has cut soda ash prices by 3- 5% to keep domestic price competitive vs imports. 2) Govt of India increased MSP of Rabi crops by 4-7%. 3) Coromandel Intl commissions state-of-the-art sulphuric acid plant with a capacity of 1,650/day. 4) Chemplast Sanmar signs LOI with a global agrochemical major to supply active ingredient. 6) A massive fire broke out with a blast at a chemical manufacturing plant of Aether Industries in the Sachin GIDC area. GPCB has ordered Aether to stop production until further notice. 7) PCBL Ltd acquires 100% stake in Aquapharm Chemicals Pvt Ltd for a consideration of Rs38bn. Aquapharm is into water treatment chemicals like Phosphonates, biodegradable chelating agents, polymers, biocides, oil field chemicals.8) PCBL has also entered into 51% JV with Kinaltek (an Australian company, which has developed nano silicon technology for battery application). The JV will have the intellectual property and know-how of products for battery application and pilot plant for the same.
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