September 05, 2024 – According to domestic petrochemical inventory data, the polyolefin stockpile of two major oil companies has decreased by 30,000 tons to 750,000 tons compared to the previous day.
In Shenhua’s bidding situation, the linear bidding volume stood at 850 tons today, with actual transactions amounting to 264 tons. However, both the bidding volume and transaction volume for high-pressure and low-pressure products were zero, indicating a decline in market activity.
The PE spot market showed an overall weak performance today. Despite an increase in low-pressure wire drawing prices in North China, other market prices remained stable with a slight downward trend, falling within a range of 10-50 yuan/ton. In terms of costs, the PE cost decreased due to a roughly 4% drop in international oil prices. No new maintenance announcements were made on the supply side, while the demand side witnessed downstream purchasing based on rigid demand at lower prices. Overall, the PE market exhibited a trend of slight profit concessions, and both spot and futures markets appeared to be in a weak consolidation state.
Regarding the forecast for PE spot trends, the crude oil market remains affected by economic and demand concerns, coupled with instability in geopolitical situations. Currently, there are no significant positive factors in the market. The market is closely monitoring news about OPEC+ production cuts and interest rate cuts by the Federal Reserve. On the supply side, most of the previously inspected units were temporarily shut down, and it is expected that some PE units will resume operation in the short term. Additionally, Iranian ships are expected to arrive at ports in early September, gradually increasing domestic and port supply. In terms of demand, although the impact of the peak season in September has been delayed and downstream factory orders have grown slowly, the positive impact of end-user demand on the PE market remains limited in the short term. Taken together, the polyethylene market may maintain a weak consolidation trend in the near future.
In the futures market, the L2501 contract opened at 7999 on September 4th, reaching a high of 8013 and a low of 7930 during the day. The open interest stood at 408,097 contracts, and the settlement price was 7968, down 74 points from the previous day’s settlement price.
Furthermore, according to data calculations from Tuduoduo, the domestic HDPE spot index declined by 17 points to 7963 on September 4th, while the LDPE film spot index remained stable at 10377. The LLDPE spot index dropped by 5 points to 8282. These index changes, as understood by the Color Masterbatch Industry Network, reflect the current overall trend and dynamics of the PE market.