The picture shows the PE stock
Boosted by the rebound in demand, the plastics market has rebounded recently. In the later period, plastic prices may oscillate in view of increased supply and falling costs.
Since July, the demand for shed film has increased, traders, downstream companies have increased their enthusiasm for low-end replenishment, and PE prices have risen. Technically, plastic prices are still in the downtrend channel, and whether the 1901 contract can stand at 9,560 yuan/ton is doubtful.
Demand is gradually picking up
In June, demand was not good, and plastic prices continued to decline. However, after hitting a new low in a year, the downstream companies' replenishment enthusiasm rebounded, and the gradual improvement in shed film demand further strengthened this replenishment behavior. Currently, downstream The operating rate of the packaging film is stable; the shed film operating load is 23%, although it is low, but it continues to rise. Therefore, with the arrival of the greenhouse film consumption season, the demand for plastics is gradually increasing.
Demand is picking up, PE supply is tight, and inventory has declined. As of July 26, Huadong Petrochemical's PE inventory was 50,265 tons, down 9535 tons from the high point in early July, a decrease of 15.94%; the inventory of Huadong warehouse was 126,000. Tonne, down 20,000 tons from the high point in early July, a decrease of 13.70%; social inventory was 217,965 tons, down 35,485 tons from the high point in early July, a decrease of 14%. Due to low inventory, the willingness to replenish the market Further increase, thereby stimulating the price of methanol.
The maintenance device is restarted one after another.
In the early stage, the price of plastics was low, the efficiency of enterprises was not good, and consumption was in the off-season. Many PE manufacturers chose equipment maintenance at the end of June and early July, and the production capacity involved reached 6.26 million tons/year. However, after consumption recovered and prices rose, The overhaul unit will be re-produced in large areas, and the remaining equipment will be resumed in early August. In August, only Daqing Petrochemical's 760,000 tons/year plant is scheduled to be discontinued.
It should be noted that the recent depreciation of the RMB, the cost of imported ethylene and plastic products will rise, and the import volume may decline in the later period. In addition, China’s tariffs on the United States are counter-productive, ethylene and plastic products are among them, while domestically from the United States. Imported ethylene, the proportion of plastics is not small, which may affect imports, the dependence of the latter market on domestic output will increase.
Crude oil and coal are easy to fall
In August, the consumption of refined oil products is coming to an end, and the support for demand for crude oil prices has weakened. In addition, the number of active drilling in the United States continues to increase, production continues to be high, and US crude oil prices are weak. In the Middle East, although sanctions against Iran affect the country’s Export, but other OPEC member states are working hard to increase production, and the crude oil operating center of gravity has a high probability of moving down.
In terms of coal, the peak of summer electricity consumption is nearing completion, and the inventory of coal-fired power companies began to accumulate, and coal prices fell sharply.
Crude oil and coal are easy to fall, and PE costs are bound to fall.
Market outlook
In summary, the greenhouse film consumption season is approaching, coupled with the buying up and not buying down the psychology to promote downstream goods, plastic demand is picking up. However, the early maintenance equipment has resumed production, the increase in supply will ease the current tight supply problem. Upstream crude oil and coal prices have weakened, and the support for the plastics market has weakened. Based on the above judgment, plastic prices do not have a substantial increase, and the recent market should treat prices with short-term rebound.