The main raw materials required for the production of cellulose ether include refined cotton (or wood pulp) and some common chemical solvents, such as propylene oxide, methyl chloride, liquid caustic soda, caustic soda, ethylene oxide, toluene and other auxiliary materials. The upstream industry enterprises of this industry include refined cotton, wood pulp production enterprises and some chemical enterprises. The price fluctuations of the above-mentioned main raw materials will have varying degrees of impact on the production cost and selling price of cellulose ether.

The cost of refined cotton is relatively high. Taking building material grade cellulose ether as an example, during the reporting period, the cost of refined cotton accounted for 31.74%, 28.50%, 26.59% and 26.90% of the sales cost of building material grade cellulose ether respectively. The price fluctuation of refined cotton will affect the production cost of cellulose ether. The main raw material for the production of refined cotton is cotton linters. Cotton linters are one of the by-products in the cotton production process, mainly used to produce cotton pulp, refined cotton, nitrocellulose and other products. The use value and use of cotton linters and cotton are quite different, and its price is obviously lower than that of cotton, but it has a certain correlation with the price fluctuation of cotton. Fluctuations in the price of cotton linters affect the price of refined cotton.

The sharp fluctuations in the price of refined cotton will have different degrees of impact on the control of production costs, product pricing and profitability of enterprises in this industry. When the price of refined cotton is high and the price of wood pulp is relatively cheap, in order to reduce costs, wood pulp can be used as a substitute and supplement for refined cotton, mainly for the production of cellulose ethers with low viscosity such as pharmaceutical and food grade cellulose ethers. According to the data from the website of the National Bureau of Statistics, in 2013, my country’s cotton planting area was 4.35 million hectares, and the national cotton output was 6.31 million tons. According to statistics from the China Cellulose Industry Association, in 2014, the total output of refined cotton produced by major domestic refined cotton manufacturers was 332,000 tons, and the supply of raw materials is abundant.

The main raw materials for the production of graphite chemical equipment are steel and graphite carbon. The price of steel and graphite carbon accounts for a relatively high proportion of the production cost of graphite chemical equipment. Price fluctuations of these raw materials will have a certain impact on the production cost and selling price of graphite chemical equipment.