Starting from January 14, boosted by the capital construction plan, the main lead contract in Shanghai experienced 4 Lianyang, with the highest price reaching 17810 yuan/ton. From the basic point of view, near the Spring Festival, downstream enterprises have holidays, demand performance tends to be flat, it is difficult to boost lead prices. On the supply side, although the inventory of lead market is still at a low level and the price difference between primary lead and reclaimed refined lead is small, the price of reclaimed lead raw material waste battery keeps falling, resulting in the continuous decline of production cost of reclaimed lead, and the support for lead price gradually weakens. When market sentiment returns to calm, lead prices will return to the fundamentals, showing a weak trend of oscillation.

Business Startup Rate Continuously Declining

With the approaching of the Spring Festival, downstream enterprises have a holiday one after another, and the start-up rate of lead-acid battery enterprises has declined one after another. According to the survey, the weekly comprehensive start-up rate of lead-acid battery enterprises was 61.5% last week, which was lower than 66% in December 2018. As the Spring Festival approached, some remote areas began to stop logistics, distributors purchased less, and manufacturers finished pre-festival battery storage, and adjusted production line start-up rate one after another, so this week many provinces lead-acid battery enterprises start-up rate generally down. In addition, SMM said that on January 20, some small lead-acid batteries enterprises will begin their holidays one after another, while large and medium-sized enterprises will gradually stop production according to the production process until January 27-31, and lead-acid batteries enterprises around the country will stop production centrally.

From the downstream data, China Automobile Industry Association data show that in December 2018, China’s automobile production was 25234,000, down 17.03%, the same period in 2017 was -0.70%, the same period in 2018 was 16.33 percentage points lower than the same period in 2017.

Waste battery prices continue to fall

Due to poor demand, the current profit level of recycled lead enterprises has fallen. It is estimated that as of January 22, the profit of recycled lead enterprises is 325 yuan/ton, which is lower than the average profit value of 536.25 yuan/ton in December 2018. However, as far as recycled lead used batteries are concerned, the price of waste batteries has been declining since October 2018. As of January 21, the price of Shanghai non-ferrous grid start-up car waste batteries (white shell withholding waste liquid) is 8,600 yuan/ton, which is lower than 9350 yuan/ton in the same period last year. The cost of recycled lead production is 16,000 yuan/ton, which is lower than 17,250 yuan/ton in the same period of 2018.

If renewable lead enterprises lose money, they will choose to stop production, then the cost of production of renewable lead will support the price of lead. However, due to the continued decline of the old price of waste battery, the cost of renewable lead will decline, so the support of the future lead market is expected to gradually decline.

In addition, according to the survey, due to the end of the year, production and marketing of refineries and the recovery of refinery maintenance, in December 2018, the operating rate of primary smelters increased year-on-year. Data show that in December 2018, the operating rate of primary lead smelters in China was 66.06%, 2.96% higher than that in November, and 6.33% higher than that in November. The start-up rate of primary lead smelters increased year on year, indicating an increase in lead supply. In a word, the decrease of the price of waste battery leads to the decrease of the production cost of recycled lead, and the start-up rate of the original lead smelter increases greatly year-on-year. The supply side of lead market also causes some pressure on the price of lead.

In summary, near the Spring Festival, inventory has rebounded, lead-acid battery business startup rate continues to decline, demand-side performance tends to be flat. On the supply side, lower prices of waste batteries will weaken the cost support of recycled lead, and the increase in the start-up rate of primary lead smelters also indicates an increase in the supply of primary lead in the short term. After the market mood gradually returns to calm, period lead or under the influence of empty fundamentals operates under pressure.

London, Jan. 21, reported that copper prices fell on Monday as data showed that China’s economic growth had cooled and activity was expected to slow before the Spring Festival holidays, heightening market concerns about China, the world’s major consumer market demand.

The London Metal Exchange (LME) copper index closed down 1.2% at $5,981 a tonne. Last week, copper hit a three-week high of $6,077 a tonne.

Vivienne Lloyd, an analyst at Macquarie, said, “Before and during the Spring Festival holidays, everything came to a standstill, which weakened the market.”

“The damage to copper prices caused by the trade war has been assimilated, so any form of reconciliation is good news.”

China’s economy cooled in the fourth quarter, frustrated by weak domestic demand and US tariff pressure, lowering its annual growth rate to 6.6% in 2018, the lowest level in nearly 30 years.

The Spring Festival holidays begin on February 4 and end on August 8, but many factories close one week before the Spring Festival.

Concerns about the recent tin supply in the LME market have led to a substantial premium of more than $100 per ton on spot tin over three-month tin.

LME approved a tin inventory of 1,090 tons, about a third of last December’s level. Behind the market tension are large holdings of tin warrants and spot contracts.

Three-month tin closed up 0.2% at $20,650 a tonne, close to the seven-month high of $20,770 hit last week.

Aluminum fell 1.0% to $1,852 a tonne.

Zinc rose 0.3% to $2,588.

Lead prices closed unchanged, but ended up 0.7% higher at $2,012.

Nickel fell 0.2% to $11,800 a ton.

Price trends:

According to the monitoring data of business associations, as of January 18, the average price of acetic anhydride quoted by enterprises was 6016.67 yuan/ton, which was more stable than the quotation of acetic anhydride last weekend, and the market of acetic anhydride was more stable this week.

2. Market analysis:

Product analysis:

This week, the domestic acetic anhydride ex-factory quotation is temporarily stable, and the market transaction price is stable. Most of the region’s ex-factory quotation is 5900-6200 yuan/ton, the actual transaction price is temporarily stable, Shandong’s actual transaction price is about 5850-6000 yuan/ton, the price is stable, Jiangsu’s transaction price is about 5950 yuan/ton, the market quotation is the reference price, and the actual transaction price is based on actual negotiation.

Factor analysis of industrial chain:

The price of acetic acid remained stable this week. As of January 18, the price of acetic acid was quoted at 3100 yuan/ton, and the price of acetic acid was stable. The price of methanol fell this week. As of January 17, the price of methanol quoted 2264.00 yuan/ton. This week, the price of methanol fell, the cost of acetic anhydride fell, the downstream customers’purchasing enthusiasm was general, and the demand for acetic anhydride was general, which had a negative effect on the market of acetic anhydride.

3. Future market forecast:

Bai Jiaxin, a data analyst for acetic anhydride in business associations, believes that this week’s offer for acetic anhydride is stable. Raw material prices fell this week, acetic anhydride costs fell, acetic anhydride market has a negative impact, the overall price of acetic anhydride has a certain downward pressure. The downstream purchasing enthusiasm is general, the demand for acetic anhydride is at a low level, and the overall market for acetic anhydride is negative. The price of acetic anhydride is expected to fall in the future.

The United States is expected to become the world’s third largest exporter of liquefied natural gas (LNG) this year, creating jobs at home while reducing emissions and providing reliable energy for the rest of the world, according to the American Petroleum Institute (API), Houston, Jan. 13.

API, the U.S. LNG Center and the LNG Alliance, the three national trade associations specializing in American LNG, recently issued an unprecedented joint statement on the extraordinary development of American LNG in 2019.

Todd Snickler, API’s vice president for market development, said: “Since 2016, the substantial growth of LNG exports in the United States has continued to bring tremendous benefits to the United States and the rest of the world. With LNG’s export capacity nearly doubling in 2019, the United States is expected to become the world’s leading gas supplier this year.

“American LNG cargo has been shipped to nearly 30 countries around the world. With the rapid growth of global LNG demand, we expect more countries to benefit from American LNG in the coming years, including from emission reduction,” Todd said.

Charlie Reid, managing director of the U.S. Liquefied Natural Gas Center, said: “The U.S. LNG industry will witness significant growth in 2019. The launch of several U.S. projects will nearly double U.S. exports to the growing global market. Because the United States has a huge natural gas resource base, the United States has a unique position in providing natural gas to partners in urgent global demand.

Charlie added: “As the latest NERA study from the U.S. Department of Energy shows, even with export growth, natural gas prices in 2040 are expected to be only slightly higher than in 2010. Most importantly, the positive economic benefits of exports will outweigh moderate price increases.

The PX commodity index was 64.80 on January 15, unchanged from yesterday, down 36.72% from the peak of 102.40 points in the cycle (2013-02-28), and up 42.26% from the low of 45.55 points on February 15, 2016. (Note: Period refers to 2013-02-01 to date).

Recently, the domestic market price trend of p-xylene has been rising. Pengzhou Petrochemical Unit has been running steadily, Urumqi Petrochemical Unit has started 50% and Fuhaichuang Aromatic Hydrocarbon Unit has been restarted. Other units have been running steadily for the time being. The domestic market supply of p-xylene has increased, and the market price trend of p-xylene has been stable for the time being. The opening rate of PX plant in Asia is less than 70%. The closing price of PX plant in Asia increased by 4 US dollars/ton on Jan. 15. The closing price was US$1055-1057/ton FOB in Korea and US$1075-1077/ton CFR in China. More than 50% of PX plant in China needed to be imported. The rise of foreign price has a positive effect on domestic market price of paraxylene. The price in Asia increased by 500 yuan/ton to 8600 yuan/ton.

On January 15, the price of WTI crude oil in February rose to 52.11 U.S. dollars per barrel, an increase of 1.60 U.S. dollars. Brent crude oil in March rose to 60.64 U.S. dollars per barrel, an increase of 1.65 U.S. dollars. The closing price of crude oil rose slightly, which supported the price of downstream petrochemical products and increased the price of paraxylene market. Recently, the textile industry has gone up, PTA prices have risen slightly in the near future. The average offer price in East China is raised near 6400-6600 yuan/ton. As of the 15th day, the domestic PTA start-up rate is about 72%, the polyester industry start-up rate is about 82%. In addition, the market price of PTA is generally volatile. It is expected that the price of PX market will maintain 8600 yuan/ton in the later period.