I. Overall Trend
This week (6.24-6.28) polyethylene showed a stop-fall and rise. The average price of LDPE 2426H in East China monitored by business associations was about 8312.5 yuan/ton; the average price of HDPE 5000S was about 8900 yuan/ton; and the average price of LLDPE 7042 was about 7900 yuan/ton. As of June 28, the prices of LLDPE and HDPE in East China showed a trend of rising first and then stabilizing this week. LDPE prices showed a trend of falling first and then rising this week.
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On June 28, the LLDPE commodity index was 75.66, unchanged from yesterday, down 35.64% from its peak of 117.56 points in the cycle (2013-12-11), and up 2.16% from its low of 74.06 points on June 20, 2019. (Note: Period refers to 2011-09-01 to date)
On June 28, the LDPE commodity index was 64.69, unchanged from yesterday, down 42.92% from 113.33 points in the cycle (2013-12-08), and up 0.61% from 64.30 points on June 26, 2019. (Note: Period refers to 2011-09-01 to date)
On June 28, the HDPE commodity index was 72.14, unchanged from yesterday, down 29.50% from the peak of 102.33 points in the cycle (2014-07-24), and up 1.14% from the low of 71.33 points on June 24, 2019. (Note: Period refers to 2011-09-01 to date)
II. Market Analysis
Upstream: International oil prices are rising this week. WTI crude oil August futures settled at $57.90 a barrel on Monday (June 24), up $0.47 from the previous trading day, trading range $56.75-58.22; Brent crude oil August futures settled at $64.86 a barrel, down $0.34 from the previous trading day, trading range $64.08-65.79. On Thursday (June 27), WTI crude oil August futures settled at $59.43 a barrel, up $0.05 from the previous trading day, trading range $58.60-59.72; Brent crude oil August futures settled at $66.55 a barrel, up $0.06 from the previous trading day, trading range $65.63-66.82.
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The rise of futures and crude oil boosted the market. Petrochemical raised some ex-factory prices, and the market rose first and then stabilized. Traders are experiencing a rise, downstream factories are more enthusiastic about entering the market, and the trading atmosphere has improved. However, end users often maintain just need to replenish. The difficulty remains.
In May 2019, PE imports amounted to about 1.419 million tons, of which LLDPE imports amounted to 433,300 tons; HDPE imports amounted to 675,100 tons; LDPE imports amounted to 309,700 tons; PE exports in May 2019 amounted to 25,300 tons.
Manufacturer dynamics: this week, agricultural film dealers are cautious in placing orders, mainly in need, manufacturers have limited order accumulation, a few manufacturers maintain low start-up, but some manufacturers are still in the state of shutdown maintenance. Functional film demand continued to be weak, sunlight film demand increased compared with the previous period, the start-up of manufacturers slightly improved, the start-up rate maintained at about 20%. With the end of plastic film demand, the manufacturer gradually shut down.
Futures Trend: On June 28, the main contract of polyethylene futures L1909 opened at 7835, the highest price 7885, the lowest price 7770, the closing price 7830, the pre-settlement price 7895, the settlement price 7825, down 65, 0.52%, the volume 447940, the position 651914, the daily increase of 4608. (Quote unit: yuan/ton)
Industry: According to the price monitoring of business associations, in the 25th week (6.24-6.28) of 2019, there were 8 kinds of commodities in the rising and falling list of rubber and plastic plate. The top three commodities were PET (2.63%), ABS (1.52%) and LLDPE (1.28%). There are six kinds of products with ring-to-ring ratio declining. The products with the first three declining ranges are styrene-butadiene rubber (-3.19%), natural rubber (-2.29%) and cis-butadiene rubber (-2.24%). Average gains and losses this week were -0.14%.
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3. Future Market Forecast
Looking forward to the future, business analysts believe that futures have rebounded, boosting the market. Petrochemical stocks are mostly maintained at a low median level, with little inventory pressure. It is expected that the future market will be strong in the short term.