According to the Commodity Market Analysis System of Business Society, TDI prices in East China continued to decline this week. On March 14th, the average market price in East China was 16900 yuan/ton, a decrease of 500 yuan/ton compared to the price of 17400 yuan/ton on March 8th, a decrease of 2.87%, and a month on month decrease of 0.59%.

The TDI market is weak, downstream purchasing enthusiasm is low, and there is a small amount of essential procurement in the market. The actual trading atmosphere is light. At the beginning of the week, profit taking orders were sold at low prices to ensure safety, driving the focus of market negotiations downward. Under the sentiment of buying up but not buying down, TDI prices continue to decline, and market demand is insufficient. The TDI market is operating weakly.

The upstream toluene market remained stable with a downward trend. On March 14th, the domestic average price of toluene was around 7250 yuan/ton, a decrease of 0.28% from the price of 7270 yuan/ton on March 8th. The narrow fluctuations in international crude oil prices provide some support for the cost of toluene. Downstream production of xylene is temporarily stable, with sufficient support for toluene’s demand. At the same time, the recovery of the domestic mixed blending market is slow, and the demand for toluene is weak. In addition, with the continued increase in toluene port inventory, supply pressure has increased, and the price of toluene has stabilized and declined.

In the future market analysis, TDI data analysts from Business Society believe that domestic TDI prices continue to decline, and suppliers are mainly wait-and-see in the short term. Under the influence of psychological factors, there may be a willingness to raise prices in the future market. Downstream follow-up is needed, and market trading is limited. There is a game of supply and demand on the market, and it is expected that the TDI market will remain stagnant and consolidate in the later stage. Specific information on major manufacturers will be released.

Price trend

According to the bulk list data from Business Society, the domestic PC market in the first half of March experienced a narrow range of fluctuations and consolidation, with spot prices of various brands fluctuating. As of March 13th, the benchmark price for the mixed PC of Shengyishe was around 16100 yuan/ton, with a 0% increase or decrease compared to the beginning of the month.

Cause analysis

In terms of raw materials, it can be seen from the above figure that bisphenol A has been declining continuously in China recently. Recently, most mainstream regions of the secondary raw materials have remained stable, with only a slight increase in the mainstream regions of East China. The trading heat is still acceptable, and there is still support for bisphenol A. Downstream enterprises have a slow consumption rate, and the pressure on traders remains unabated. The actual transaction volume is limited. It is expected that the bisphenol A market will operate in a weak and volatile manner in the future, with weak support for the PC cost side.

In terms of supply: In the first half of March, the overall operating rate of PC in China was relatively high, and the current industry average operating rate is around 80%. Due to the decline in raw material prices, PC companies have increased their profit margins, actively returned production capacity, and increased supply. However, there are maintenance reports for some devices in the future, smoothing out the negative impact on the supply side.

In terms of demand: Recently, PC consumption has been slowly recovering from the previous stage, with the main logic leaning towards digesting inventory. Downstream enterprises are lagging behind in resuming work, and there is poor demand for on-site stocking. In addition, buyers have some resistance to PC sources with rising prices, and the demand side generally supports spot prices.

Future Market Forecast

In the first half of March, the PC market experienced a narrow range of fluctuations and consolidation. The upstream bisphenol A market has fallen sharply, providing poor support for PC costs. The domestic polymerization plant maintains a high load, and the market has abundant spot supply, increasing supply pressure. The development speed on the demand side is still slow, and PC consumption is restricted. It is expected that the PC market will continue to experience narrow fluctuations in the future.

According to the Commodity Market Analysis System of Business Society, the toluene market has seen a slight upward trend in recent days (3.1-3.12). On March 12th, the benchmark price of toluene was 7270 yuan/ton, an increase of 0.55% from 7210 yuan/ton on March 1st.

International crude oil prices fluctuate narrowly, with toluene receiving some support

Recently (3.1-3.12), on the one hand, the geopolitical situation has been relatively calm, but market concerns about demand still exist; On the other hand, OPEC+agreed earlier this month to extend its voluntary production reduction until the second quarter, and the recent narrow fluctuations in the international crude oil market still provide some support for the cost of toluene. As of March 11th, WTI04 contract settlement is $77.93 per barrel; Brent 05 contract settlement is $82.21 per barrel. The high consolidation of Asian toluene prices provides some support for the domestic market. As of March 11th, the CFR China LC90 day toluene price was between 893-895 US dollars per ton.

Starting production of xylene temporarily stabilizes toluene and obtains necessary support

The domestic supply of xylene is stable, and the domestic PX operating rate is maintained at over 80%. The operation of the Pengzhou petrochemical plant is stable, but there are still some units undergoing maintenance, and there is sufficient spot supply. This week, the international crude oil price range fluctuated, and PX external prices have decreased. As of the 7th, the closing prices in the Asian region were 977-979 yuan/ton FOB Korea and 1002-1004 US dollars/ton CFR China. Recently, the operating rate of PX plants in Asia has remained high, with an overall operating rate of nearly 80% for xylene plants in the Asian region. The supply-demand contradiction of PX supply in the Asian region has become apparent, and the domestic xylene market price trend is temporarily stable.

Slow recovery of domestic mixed blending market, weak support for toluene demand

After the holiday, the recovery of the domestic mixed blending market was slow, and the demand for mixed xylene mixed blending weakened. As of March 7th, the construction of refineries nationwide was around 7.3.

Continuous increase in toluene port inventory and increased supply pressure

Domestic toluene port inventories have continued to remain at high levels. As of March 8th, toluene inventories in East China were 90000 tons, while those in South China were 19000 tons. There is still a slight increase compared to the previous period, and the pressure on toluene supply remains. The domestic production of toluene is stable, with a rate of around 740% as of March 11th.

Market forecast: Currently, international crude oil is experiencing narrow fluctuations, and there is still support for the cost of toluene; Secondly, the recovery of demand in some downstream industries is slow, and the support for rigid demand is weak; Finally, the inventory of toluene at the port is high, and the pressure on the supply side of toluene remains. Overall, it is expected that the toluene market will mainly experience fluctuations in the later period.

Recent price trends of hydrochloric acid

According to the Commodity Analysis System of Business Society, the domestic hydrochloric acid market prices have significantly increased this week, with the average market price rising from 90 yuan/ton at the beginning of the week to 95 yuan/ton over the weekend, an increase of 5.56%. The weekend price has decreased by 46.02% year-on-year.

Upstream support is average, while downstream demand increases

From the supply side perspective, the domestic hydrochloric acid market has seen a slight increase in prices this week, with manufacturers operating at an average level and low inventory.

From the perspective of the upstream and downstream industrial chain of hydrochloric acid, the upstream liquid chlorine market has recently seen a high-level consolidation, with average cost support. The downstream polyaluminum chloride market has been fluctuating and rising recently. The market price is around 1815 yuan/ton, and the weekend price fell by 4.60% year-on-year. Polyaluminum chloride manufacturers are gradually resuming production, and downstream procurement willingness is strong.

Future Market Forecast

In mid to late March, the market price of hydrochloric acid may fluctuate and rise mainly. The upstream liquid chlorine market is consolidating at a high level, with good cost support. The downstream polyaluminum chloride market is fluctuating and rising, and downstream purchasing willingness is increasing. Analysts from Business Society believe that the recent slight fluctuations and gains in the hydrochloric acid market are the main trend.

Zinc prices have risen significantly this week

According to the Commodity Market Analysis System of Business Society, as of March 8th, the zinc price was 21138 yuan/ton, a significant increase of 2.97% compared to February 29th, when the zinc price was 20528 yuan/ton. South Korean zinc smelters are reducing production, leading to a decrease in expected zinc ingot supply. The Federal Reserve is expected to lower interest rates, causing a decline in the US dollar index. China has entered the traditional peak season of “gold, silver, and four”. The decrease in supply, combined with macroeconomic benefits, has boosted the zinc market and led to a significant increase in zinc prices.

South Korean zinc smelters reduce production

According to foreign news on March 6th, South Korea’s Young Poong Corp stated that it has reduced the production of its Seokpo zinc smelter by one-fifth. The Seokpo zinc smelter produces 400000 tons annually and is the sixth largest zinc smelter in the world. A large-scale production reduction or complete closure will reduce the expected surplus of 300000 tons this year, leading to a shortage in the zinc market. The expected reduction in zinc supply in the market has increased support for the rise in zinc prices.

Federal Reserve cuts interest rates

Federal Reserve Chairman Powell reiterated in his speech to Congress on Wednesday that he expects interest rates to start falling this year, and Powell’s speech sparked a positive reaction in the market. The stock market rose, the yield of US treasury bond bonds fell, the US dollar index declined, the international macro-economy was favorable, and the support for the rise of zinc price was increased.

Domestic macroeconomic benefits

China has entered the traditional consumption peak season of “gold, silver, and four”, and demand recovery is imminent, boosting the rebound of non-ferrous metals. During the Two Sessions, the market is waiting for good news, and the overall macroeconomic sentiment is warming up. The domestic macroeconomic situation is positive, the non-ferrous metal market is positive, and the support for the rise of the zinc market is increasing.

Future Market Forecast

According to data analysts from Business Society, in terms of supply, zinc smelters are reducing production, leading to a decrease in the expected supply of zinc in the market; In terms of demand, the traditional peak season in the zinc market, combined with positive news during the two sessions and the stimulus effect of the Federal Reserve’s interest rate cut, has led to an expected rebound in demand for zinc. In the future, the supply of zinc in the market has decreased and demand has rebounded. It is expected that the zinc market will fluctuate and rise in the future.