1、 Price trend
According to the commodity analysis system of Shengyi Society, the price of caustic soda has increased this week. The average market price at the beginning of the week was 807 yuan/ton, and the average market price over the weekend was 829 yuan/ton, with a price increase of 2.73% and a year-on-year increase of 4.94%. On May 11th, the Business Social Chemical Index was 783 points, unchanged from yesterday, a decrease of 44.07% from the highest point of 1400 points during the cycle (October 23, 2021), and an increase of 30.94% from the lowest point of 598 points on April 8, 2020. (Note: The cycle refers to the period from December 1, 2011 to present)
2、 Market analysis
According to the commodity analysis system of Shengyi Society, the price of caustic soda has been rising this week. The price of caustic soda in Shandong region is around 780-880 yuan/ton in the mainstream market of 32% ion-exchange membrane alkali. The price of caustic soda in Jiangsu region is stable, and the mainstream market price of 32% ion-exchange membrane alkali is around 870-980 yuan/ton. The price of caustic soda in Inner Mongolia region is temporarily stable, and the mainstream market price of 32% ion-exchange membrane alkali is around 3900-4100 yuan/ton (converted to 100 yuan). This week, the caustic soda company underwent maintenance, resulting in a decline in inventory. Downstream aluminum plants have a relatively high profit level across the industry, and the company is operating at a high load. The demand for alumina is still acceptable, and the demand for caustic soda from alumina is also acceptable.
Business analysts believe that the recent rise in caustic soda prices is driving the market trend, and the domestic downstream demand is still acceptable, supporting the firm operation of caustic soda prices. It is expected that caustic soda will maintain a strong operating trend in the later period, depending on downstream market demand.

According to the Commodity Market Analysis System of Shengyi Society, the domestic PTA spot market has shown a slight increase since May. As of May 9th, the average market price in East China was 4750 yuan/ton, an increase of 3.63% from the beginning of the month. During the May Day holiday, international oil prices fell sharply, and the PTA market opened slightly lower after the holiday. Subsequently, international oil prices rebounded, and the cost performance remained firm. In addition, two sets of equipment were repaired one after another, and domestic supply decreased, which helped push PTA prices higher.
The international crude oil market saw a significant decline during the May Day holiday, mainly due to OPEC+increasing production beyond expectations, which negatively impacted international oil prices. After May Day, with the increasing oil restrictions imposed by the United States on a certain country, as well as the impact of the Israeli Palestinian conflict and the intention of China and the United States to negotiate, international oil prices have risen. As of May 8th, the settlement price of the main contract for WTI crude oil futures in the United States was $59.91 per barrel, and the settlement price of the main contract for Brent crude oil futures was $62.84 per barrel.
From a personal perspective, there has been an increase in PTA maintenance since May, and the PTA industry’s operating rate has decreased to around 72%, the lowest level of the year.
Downstream polyester production and sales continued to increase before the holiday, leading to a significant improvement in industry inventory. The polyester load remained at 90%, which is the highest level in the same period in the past five years. In addition, there are signs of easing in the trade dispute, with a rebound in commodity sentiment, an improvement in demand sentiment, and a slight issuance of terminal orders.
Business analysts believe that OPEC+’s accelerated production increase and demand outlook are poor, and the pressure on the crude oil market still exists. In addition, some of its PTA maintenance facilities have restarted, resulting in a slight increase in domestic supply. However, there is an opportunity for the geopolitical situation to ease, and the macro trends both domestically and internationally are positive. The downstream polyester load has exceeded expectations, and there is an improvement in terminal orders to support sentiment. Therefore, in the short term, PTA prices are mainly subject to strong fluctuations.

According to the Commodity Market Analysis System of Shengyi Society, the aggregated MDI market has seen a slight increase recently. Currently, the mainstream price for Shanghai goods is 15200-15500 yuan/ton, while the mainstream price for domestic sources (PM200) is 15400-15600 yuan/ton. In recent times, export orders have been delivered in a concentrated manner, and intermediaries have shown a clear willingness to raise prices. Low end quotations have stopped falling and increased. In May, there will be limited supply for the Ningbo plant, and there will be maintenance plans for the Shanghai plant. The supply is expected to tighten, and it is expected that the aggregated MDI market will operate strongly in the short term.

According to the commodity analysis system of Shengyi Society, the domestic maleic anhydride market first fell and then rose in April, with an overall increase. As of April 30th, the average bid price for maleic anhydride was 6920.00 yuan/ton (including tax), an increase of 2.59% from 6750.00 yuan/ton on April 1st.
On the supply side: In mid to early April, due to the impact of US tariffs, there was a significant decline in domestic bulk commodities, and the factory execution prices in the domestic maleic anhydride market continued to fall. Downstream unsaturated resin manufacturers of maleic anhydride had limited procurement, and they mainly replenished their demand for maleic anhydride. In late April, Yantai Wanhua unexpectedly shut down, and the price of maleic anhydride factory increased significantly. At present, Yantai Wanhua is parked until the end of May, and Hengli Petrochemical has a low load. Qingdao Refining and Chemical will start selling during the May Day holiday. As of April 30th, the factory price of solid anhydride in Shandong region is around 6700 yuan/ton, and the factory price of liquid anhydride is around 6400 yuan/ton.
Upstream: Pure benzene market prices fluctuated and fell in April. The market price fell in the first half of the year, fluctuated and rose in the middle, and fell in the second half. On April 1st, the price was 6659.67 yuan/ton; On April 29th, the price was 5785.33 yuan/ton, a decrease of 13.13% from the beginning of the month.
The international crude oil market fluctuated downward in April, and the price of n-butane in the market decreased. As of April 30th, the price in Shandong was around 5030-5100 yuan/ton.
Downstream: During the May Day holiday, some unsaturated resin plants were shut down, resulting in a relative decrease in supply. Unsaturated resin was urgently needed for downstream procurement, which limited support for unsaturated resin and led to a strong market wait-and-see sentiment.
The analyst of Shengyi Society’s maleic anhydride product believes that the main downstream resin of maleic anhydride may restart gradually in the near future. Currently, the focus is on stabilizing prices and observing, which has limited support for the maleic anhydride market. In addition, the downward trend of crude oil market during the May Day holiday is not good for the domestic maleic anhydride market. It is expected that the maleic anhydride market will decline in the near future.

Throughout April, the domestic ABS market continued to decline, with most spot prices of various grades fluctuating downwards. According to the Commodity Market Analysis System of Shengyi Society, as of May 1st, the average price of ABS sample products was 10725 yuan/ton, with a price level increase or decrease of -4.67% compared to early April.
Fundamental analysis
Supply level: In April, the operating rate of the domestic ABS industry was slightly reduced, and the overall load level decreased from 73% at the end of March to the current 65%. The average weekly production has returned to around 120000 tons, and the inventory level of aggregation enterprises has dropped from a high level to around 195000 tons. However, the on-site supply is still at a relatively abundant level. In addition, there are relatively few maintenance plans in the industry in the short term, and some have returned to production capacity, resulting in a profound supply-demand imbalance. Overall, there is limited improvement in the supply side’s support for ABS spot prices.
Cost factor: Since April, the upstream three materials of ABS have shown signs of fatigue, which has not provided good support for the cost side of ABS. At the beginning of the month, some units in the East China and Shandong regions reduced their load or underwent maintenance, resulting in a periodic decrease in supply of acrylonitrile. The inventory pressure in the industry has decreased. However, the domestic acrylonitrile market’s upward trend was hindered in the middle of the month. In addition, the new 400000 ton acrylonitrile plant of Zhenhai Refining and Chemical is also planned to be put into operation in May and June. The consumer end has weakened in stages, and prices have fallen back. With the further deepening of the supply-demand contradiction and the worsening of the loss situation in acrylonitrile production, some production enterprises will be forced to adopt measures such as parking or reducing production, and the market decline may gradually narrow. It is expected that the market price will bottom out in May, but when the market rebounds or how long it will last at the bottom will still be determined by the degree of supply reduction.

The domestic butadiene market fell first and then rose in April. In the early days of the Qingming Festival, some downstream warehouses were replenished, but due to the premium transactions of some bidding sources, as well as the impact of crude oil, tariffs, and port arrival news, the price of butadiene in the mid market significantly declined. At the end of the month, some downstream enterprises made purchases at low prices, and the market trading atmosphere slightly improved, leading to a rebound in the market.
Styrene is also subject to international news such as equivalent tariffs, and the market has experienced a significant decline in the early stage. Recently, due to the recovery of the pure benzene market and the tight balance between supply and demand of styrene, prices have shown a trend of stabilizing and oscillating. In April, there were many centralized inspections of styrene, and the supply side remained tight. Downstream 3S factories had high inventory and limited production. However, in the uncertain market situation of raw materials, the risk of a decline in styrene in the future cannot be ruled out.
On the demand side: As we enter April, the load of downstream ABS factories in the ABS terminal sector is generally flat, and the purchasing logic tends to buy at the bottom and supplement orders for urgent needs. The confidence in the market is weak, and the purchasing atmosphere tends to be wait-and-see. With the depletion of essential orders and pre holiday stock, new order deliveries have noticeably decreased, and the flow of goods has returned slowly. Overall, the demand side has poor support for the ABS market.
Future forecast
The domestic ABS market experienced a stepwise decline throughout April. The upstream three materials are weakly moving, which provides poor comprehensive support for the cost side of ABS. The production pressure of ABS polymerization plant has increased, and the load has been reduced. The weak consumption pattern on the demand side has not improved. Business analysts believe that ABS has fallen to near cost price, and the market has long had strong supply and weak demand. Coupled with the impact of international news such as equivalent tariffs, pessimistic expectations for the future are biased. The bullish trend within the market is hard to find, and there is still a possibility that the market may continue to decline in the short term.