October 15th: PE Market Analysis
Domestic Petrochemical Inventories: Polyolefin inventories from both oil and petrochemicals reached 820,000 tons, down 5,000 tons from yesterday.
PE Spot Market Analysis: Domestic PE market prices showed a weak trend today. In North China, only linear grades saw a slight increase in market prices, while low-pressure film grades remained stable. High- and low-pressure wire drawing grades both saw price decreases, fluctuating between 10 and 60 yuan/ton.
In East China, only low-pressure film grades remained stable, while linear, high-pressure, and low-pressure wire drawing grades all saw price decreases compared to yesterday, with price reductions ranging from 30 to 80 yuan/ton. In South China, linear and low-pressure wire drawing grades saw price decreases, with price adjustments ranging from 200 to 50 yuan/ton. High- and low-pressure film grades remained unchanged compared to yesterday.
The current PE market is experiencing a weak consolidation pattern amidst a mix of bullish and bearish sentiment. Ex-factory prices at upstream manufacturers haven't formed a consistent trend, with some choosing to maintain stability while others are lowering their prices by 10-200 RMB/ton.
Meanwhile, a small number of companies have seen slight price increases of 100-150 RMB/ton, but these increases have had a limited impact on the overall market. Supply and demand factors have further exacerbated the market's weakness. Post-holiday industry inventories remain high, and the market spot supply is relatively ample. This has intensified competition among intermediaries.
Traders are actively offering discounts to boost transactions and actively seeking opportunities for negotiation with downstream suppliers. Downstream manufacturers, however, remain cautious, focusing their procurement strategy on demand. Large-scale inventory replenishment has been avoided, providing little support for market prices. The PE market, impacted by high inventories, weak demand, and diverging prices, is experiencing an overall weak consolidation trend, with trading sentiment remaining subpar.
PE Spot Price Forecast: In the futures market, the L2601 contract price initially dipped slightly in the evening session before gradually rebounding. The price center of gravity gradually shifted upward in the morning session, then sharply dipped to a relatively low point for the day in the afternoon session before rebounding, fluctuating and fluctuating.
The current PE market remains weak, lacking support from both supply and demand factors and the macroeconomic environment. Although Guangzhou Petrochemical's second-line PE unit is scheduled to shut down today, this single unit change will have limited impact on the overall market supply structure. Industry inventory pressures remain significant, and the lack of clear macroeconomic guidance is struggling to boost market confidence.
Demand remains weak, with downstream companies receiving limited new orders and sourcing strategies primarily based on demand, lacking effective inventory replenishment. Against this backdrop, traders are increasingly adjusting their quotes in line with market conditions to alleviate inventory and transaction pressures. This has led to an increase in low-priced resources, further exacerbating the weak price environment.
Overall, the polyethylene market lacks upward momentum in the short term and is expected to continue its narrow, weak and volatile trend. Continued attention should be paid to inventory reduction progress and macroeconomic developments.
Mainstream PE Market Quotes:
PE Futures Analysis: October 15th L2601 Opening Price: 6890, High: 6936, Low: 6881, Open Interest: 568,826, Settlement Price: 6908, Yesterday's Settlement: 6936, Down 28%, Daily Trading Volume: 205,449 Contracts, Deposited Capital: 2.751 Billion, Capital Outflow: 43.24 Million.
Domestic PE Index: According to Tuduoduo data, on October 15th, the domestic HDPE spot index was 7547, down 0; the LDPE film spot index was 9251, down 40; and the LLDPE spot index was 7133, down 18.
Shenhua Auction Statistics: Today's linear auction volume was 700 tons, with a trading volume of 533 tons. Today's high-pressure auction volume was 400 tons, with a trading volume of 34 tons. Today's low-pressure auction volume is 0 tons, and today's transaction volume is 0 tons.
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