Hua Tai Qi Huo·2025-07-25 01:06Report Industry Investment Rating There is no relevant content provided in the report. Core Viewpoints of the Report The chemical sector's prices have gradually rebounded from the bottom since the end of June, with the market trading on the expectation of supply - side tightening. The report focuses on "old - fashioned devices" in the chemical industry, which are defined as production devices that have reached their design service life or have been in actual operation for more than 20 years. By analyzing the old - fashioned device capacities of various chemical products and their characteristics, the report comprehensively assesses the potential supply and demand impacts and the probability of subsequent transformation for each chemical product [4]. Summary According to the Directory 1. Anti - involution and Definition of Old - fashioned Capacities - In July 2025, the Central Financial and Economic Commission's Sixth Meeting proposed to "legally and regulatoryly manage the disorderly low - price competition of enterprises, guide enterprises to improve product quality, and promote the orderly withdrawal of backward capacities", marking the possible start of a new round of supply - side reform in China. Industries such as photovoltaic, cement, steel, and automotive have responded [14]. - In June 2023, multiple departments jointly issued a notice to conduct a comprehensive assessment of old - fashioned devices in the petrochemical and chemical industries, requiring the submission of basic information by July 15 and assessment results and renovation suggestions by August 30 [15]. - On July 18, the Ministry of Industry and Information Technology stated that work plans for stabilizing growth in ten key industries, including steel, non - ferrous metals, and petrochemicals, were about to be introduced, aiming to adjust the structure, optimize supply, and eliminate backward capacities [16]. 2. Overview of the Proportion of Old - fashioned Device Capacities of Various Chemical Products - In the oil - chemical industry, old - fashioned capacities of propylene, pure benzene, butadiene, cis - butadiene rubber, PE, and PP account for a large proportion, mainly owned by the "Two Barrels of Oil", and the implementation progress may be slow. In the coal - chemical and chlor - alkali industries, caustic soda has the largest proportion, and urea also has a relatively large proportion. In the polyester industry chain, the old - fashioned capacity of staple fiber accounts for a relatively large proportion [19]. 3. Analysis of Old - fashioned Devices of Propylene and Its Downstream - The in - production old - fashioned capacity of propylene is 13.56 million tons per year, accounting for 17.9% of the total capacity, mainly concentrated in the "Two Barrels of Oil". The old - fashioned capacities of downstream products such as PP granules, PP powder, PO, etc., when converted into propylene demand, total 7.54 million tons per year. If the transformation and elimination of old - fashioned capacities of propylene and its downstream are realized, the supply reduction of propylene will be greater, which is bullish. However, the transformation or elimination rate may be slow, and the actual impact remains to be tracked [24][29][31]. 4. Analysis of Old - fashioned Devices of Styrene and Its Downstream - The in - production old - fashioned capacity of styrene is about 1.41 million tons per year, accounting for 6.4% of the total capacity, mainly concentrated in the "Two Barrels of Oil". The old - fashioned capacities of downstream EPS, PS, and ABS, when converted into styrene demand, total 4.13 million tons per year. Even with a conservative calculation of non - "Two Barrels of Oil" old - fashioned capacities and a 60% operating rate, the potential demand reduction of styrene is still greater than the in - production old - fashioned capacity. The downstream rectification probability is greater, which is bearish. It is advisable to short the EB - BZ spread at high prices [35][39][40]. 5. Analysis of Old - fashioned Devices of Pure Benzene and Its Downstream - The old - fashioned capacity of pure benzene is 4.07 million tons per year, accounting for 16% of the total capacity, mainly owned by the "Two Barrels of Oil". The old - fashioned capacities of downstream products such as styrene, phenol, and adipic acid, when converted into pure benzene demand, total 1.85 million tons per year. If the transformation and elimination of old - fashioned capacities of pure benzene and its downstream are realized, the supply reduction of pure benzene will be greater, which is bullish. However, in the short term, the impacts on both the supply and demand sides are limited [45][46][47]. 6. Analysis of Old - fashioned Devices of Methanol and Its Downstream - The in - production old - fashioned capacity of methanol is about 4.81 million tons per year, accounting for 4.5% of the total capacity, mainly state - owned, and 2.9% of the capacities are below 500,000 tons per year, increasing the probability of rectification. The old - fashioned capacities of downstream MTBE, acetic acid, and formaldehyde, when converted into methanol demand, total 2.39 million tons per year. If the transformation and elimination of old - fashioned capacities of methanol and its downstream are realized, the supply reduction of methanol will be greater, which is bullish, especially for the distant 01 contract [52][58][59]. 7. Analysis of Old - fashioned Devices in the Chlor - alkali Industry Chain 7.1 Calcium Carbide - The in - production old - fashioned capacity of calcium carbide is about 4.71 million tons per year, accounting for 11% of the total capacity. Most of the large - capacity devices have undergone technological transformation, and the expected elimination capacity of small - capacity devices accounts for only 3%, with a limited impact [60]. 7.2 PVC - The old - fashioned capacity of PVC is 3.335 million tons, accounting for 12% of the total capacity. The probability of elimination of ethylene - based PVC devices is relatively low, and attention should be paid to the 9% calcium - carbide - based devices. State - owned, private, and foreign - invested enterprises all have a certain proportion, and there is a certain possibility of transformation. However, the impact on the PVC capacity structure is limited, and the supply - side pressure is still large [65][66][79]. 7.3 Caustic Soda - The in - production old - fashioned capacity of caustic soda is about 14.24 million tons, accounting for 28.8% of the total capacity. Nationally, 11% of the capacities are below 200,000 tons, increasing the probability of rectification. The impact of the supply - side rectification on the caustic soda capacity structure remains to be observed [73].