1、 Price trend

According to the commodity analysis system of Shengyi Society, the price of caustic soda increased in early September. At the beginning of the month, the average market price was 829 yuan/ton. On September 12th, the average market price was around 833 yuan/ton, with a price increase of 0.48% and a year-on-year decrease of 0.6%.

2、 In terms of market conditions

According to the commodity analysis system of Shengyi Society, the price of caustic soda rose in early September.

3、 Supply side

At the beginning of September, the market showed an upward trend, with some areas experiencing some improvement in transaction conditions. The maintenance of some facilities in Shandong had a significant boost to market prices, and there was not much pressure on enterprise inventory. Data shows that as of September 5, 2024, the inventory of liquid alkali sample enterprises with a capacity of 200000 tons or more in their factory warehouses nationwide was 286900 tons (wet tons), a decrease of 2.61% compared to the previous period.

4、 In terms of demand

In early September, downstream alumina prices continued to show a stable to strong trend. Some aluminum plants that have a demand for replenishment have concentrated their purchases in the market, driving the price of caustic soda to continue to rise. Alumina continues to be in a tight pattern, and there may still be a demand for replenishing caustic soda.

Business analysts believe that in the near future, the price of caustic soda rose in early September, and inventory in the Shandong region remained relatively low, coupled with some downstream purchasing intentions increasing. In the later stage, the supply side’s early maintenance equipment gradually resumed normal production, but there were no obvious maintenance equipment in the later stage, and the supply of goods showed a regional increase. On the demand side, the main downstream alumina enterprises’ essential procurement has provided certain support for the caustic soda market, while the demand of other downstream industries has slightly increased. The overall demand side has improved compared to the previous period. From the perspective of both supply and demand, there is not much overall change, and it is expected that caustic soda will continue to maintain a strong operating market in the later stage, depending on downstream market demand.

The market price of epichlorohydrin continues to rise this week. At present, there is a shortage of spot goods in the market, and supply remains tight. After the price increase, low-priced spot goods are difficult to find, and there has been a decrease in trading orders in the market, with a focus on purchasing small orders for essential needs. According to the monitoring system of Shengyi Society, as of September 11th, the benchmark price of Shengyi Society’s epichlorohydrin was 8275 yuan/ton, an increase of 3.60% compared to the beginning of this month (7987.50 yuan/ton).

Price influencing factors:

Raw material side: The price of raw material propylene has fluctuated and increased, while the price of liquid chlorine has fallen. The raw material side continues to decline, which provides sufficient support for the epoxy chloropropane market and has little overall impact. According to the market analysis system of Shengyi Society, as of September 11th, the benchmark price of propylene in Shengyi Society was 6845.75 yuan/ton, a decrease of -1.76% compared to the beginning of this month (6968.25 yuan/ton).

Equipment situation: According to the overall operating rate of the epoxy chloropropane industry within the week, it was 50-60%.

Downstream demand side: Following up on small orders for epoxy resin demand downstream, as costs rise and manufacturers face increased cost pressures, there is insufficient follow-up on new orders, and the market remains stable with little movement.

Market forecast: Business Society’s epoxy chloropropane analyst believes that short-term costs and supply side support are still acceptable, with downstream rigid demand buying as the main focus, insufficient follow-up of new orders, and cautious procurement of raw materials. It is expected that in the short term, the epoxy chloropropane market price will remain stable and slightly strong, and more attention still needs to be paid to changes in raw material prices.

Price trend

According to the bulk ranking data of Shengyi Society, the domestic PC market was consolidating at a low level in early September, and spot prices of various brands fluctuated narrowly. As of September 10th, the benchmark price of Business Society PC hybrid is around 16216.67 yuan/ton, which is basically unchanged compared to early September.

Cause analysis

Supply side: Since September, the overall operating rate of PC in China has increased, with the industry average operating rate rising by about 6% to 81% compared to the end of July. Although the spot price within ten days is at the low point of the year, there is ample supply of goods on the market. The manufacturer’s factory pricing is mainly stable, with some enterprises showing slight looseness. The scale of the future maintenance plan is average, and Wanhua Chemical Plant still has room for improvement. There is an expectation of an increase in industry load at a high level. Overall, the domestic PC supply has been at a temporary high in recent times, with a further deepening mismatch between supply and demand, and the market supply side is seriously dragging down PC prices.

In terms of raw materials, it can be seen from the above chart that the price of bisphenol A in China changed slightly in early September. At present, the prices of phenol and acetone, the direct raw materials for bisphenol A, are fluctuating, and the cost support is still acceptable. The downstream production of the two main forces is stable with a slight increase, and with stocking up and the approaching holiday, stocking up consumption may remain stable. There is a slight expectation of a decrease in the load of the bisphenol A industry in the future, and the supply of goods is stable with a small decrease. Overall, bisphenol A maintains its support for PC costs..

In terms of demand, the PC consumption pattern has not shown any improvement in the medium to long term, and the overall trend has been relatively weak compared to the previous period. Entering the traditional peak season of September, the current pattern has not shown any improvement. The main logic of procurement still leans towards weak rigid demand, with factories taking goods to maintain production. The load recovery of downstream enterprises is not significant, the market has poor confidence in the double festival stocking market, buyers are strongly resistant to high priced goods, and consumption remains at a low level. The circulation of goods on site is slow. The demand side has poor support for spot prices.

Future forecast

The PC market was consolidating at a low level in early September. The upstream bisphenol A market is stable with small fluctuations, and the cost support for PC is still acceptable. The load of domestic aggregation plants has increased, and the supply remains high. The current PC price has been at a low point for some time this year, but the market has not rebounded due to bottoming out or the arrival of the “golden nine”. On the contrary, downstream peak season consumption has not yet begun, and weak rigid demand stocking is difficult to drive the market. The poor flow of market supply and demand makes it difficult to correct the supply-demand imbalance in the short term. Business Society predicts that the profound supply-demand contradiction may affect the traditional peak season market, making it difficult for the PC market to rise in the future.

According to the Commodity Market Analysis System of Shengyi Society, the domestic polyester staple fiber market has maintained a fluctuating downward trend since September. As of September 9th, the average price of 1.4D * 38mm in mainstream factories in Jiangsu and Zhejiang was 7426 yuan/ton, a decrease of 1.66% from the beginning of the month. Although mainstream polyester staple fiber factories continue to operate with reduced production capacity, raw material prices remain weak, and downstream purchases are cautious according to demand, which has dragged down the polyester staple fiber market.

Specifically, the crude oil market has fluctuated and weakened. As of September 6th, the settlement price of the main contract for WTI crude oil futures in the United States was $67.67 per barrel, and the settlement price of the main contract for Brent crude oil futures was $71.06 per barrel. At present, there is a strong expectation for OPEC to increase production in October according to the plan, which weakens the impact of recent crude oil production cuts in Libya and other countries. In addition, the summer peak season for gasoline and diesel consumption has ended, and supply and demand have weakened. The crude oil market lacks positive expectations, and prices are under pressure and declining. Although geopolitical risks still exist, the current market’s main focus is on fundamentals.

The cost side of the PX market is relatively weak, and in terms of supply, the maintenance of the 1 million ton unit of Dongying Weilian and the 2 million ton unit of Zhejiang Petrochemical in China has gradually led to a narrow decrease in PX operating load. The demand side performance is stable, and PX will be in a slight destocking cycle, but the market lacks confidence in the future, and the atmosphere of supply and demand fundamentals game is obvious.

Recently, the decline in PTA prices has become increasingly significant. As of September 8th, the average spot price of PTA in East China was 4906 yuan/ton, a decrease of 8.86% from the beginning of the month. International crude oil prices have experienced a wide decline, and PTA cost support has collapsed. In addition, the company’s operating rate remains high, but downstream demand is insufficient, and PTA still faces pressure to accumulate inventory. Under the combination of multiple negative factors, the PTA market continues to weaken. The current PTA industry has not changed much in terms of production, maintaining a high level around 83%. Recently, there have been limited changes in equipment, and PTA supply remains abundant.

There is no significant expectation of improvement in terminal textile demand, and only some autumn and winter fabric orders are likely to increase. Yarn factories lack confidence in the future market and purchase raw materials to maintain essential operations. The weaving industry in Jiangsu and Zhejiang regions has slightly rebounded to around 70% of production, and the market is waiting for the downstream peak season to turn around. It is expected that production may slightly increase, and demand for polyester staple fibers will also slightly rebound.

Business analysts believe that there is sufficient supply of raw materials, and there is currently no possibility of a significant decrease in supply in the short term, which is detrimental to the market mentality due to the accumulation of inventory. The downstream market lacks confidence, trading is sluggish, and procurement is mainly focused on consuming inventory, with a cautious wait-and-see approach. The fundamentals are bearish, and it is expected that the price of polyester staple fiber will remain stable with a slight adjustment in the short term.

This week (September 2-6, 2024), the cost trend of upstream raw material dissolution slurry for adhesive short fibers is relatively firm, and cost support still exists; The manufacturer’s inventory is not high; Downstream cotton yarn is following up as needed, approaching a new round of signing nodes. Downstream manufacturers are gradually inquiring about orders and prices. With the interweaving of information on the market, there is a certain confidence in the “Golden Nine”, and manufacturers are gradually raising prices by 100-200 yuan/ton. The overall operation of adhesive short fiber is relatively strong, and the market center of gravity has shifted upward.

According to the Commodity Market Analysis System of Shengyi Society, the price of viscose staple fiber has slightly increased this week (September 2-6, 2024). As of September 6th, the domestic factory price for 1.2D * 38mm adhesive short fiber is 13640 yuan/ton, an increase of 140 yuan/ton from last week, with a weekly increase of 1.04%.

Cost side support still exists

The upstream raw material end main material dissolution slurry market is strong and stable. As of now, the price of domestic dissolution slurry is around 7800 yuan/ton, the price of external broad-leaved slurry is around 960 US dollars/ton, and the price of coniferous slurry is around 1040 US dollars/ton. The price trend of auxiliary materials in the market varies. As of September 6th, the average price of 32% liquid caustic soda in the domestic market was 886.51 yuan/ton, an increase of 0.28% compared to the beginning of the month; The average market price of 98% acid is 358 yuan/ton, a decrease of 5.79% compared to the beginning of the month. Overall, the upstream main raw material dissolution slurry market remains strong and stable, the sulfuric acid market price continues to decline, the liquid alkali market price has risen narrowly, and the cost side of the adhesive short fiber market still has positive support.

Stable supply, low inventory

The supply of adhesive short fiber industry is at a high level, and most manufacturers have stable equipment operation. The on-site operating rate is at a high level, and the current daily operating rate of the industry is around 84.79%. The early parking and maintenance equipment in Xinjiang has not been restarted yet, and the overall market supply is high. The inventory levels of various adhesive short fiber manufacturers are low, and the on-site supply is slightly tight. The supply side provides some upward momentum for the market.

The demand has not shown significant improvement

Although it has entered the traditional peak season for textile production in September, there is no obvious sign of improvement in the textile terminal market. Downstream yarn manufacturers have insufficient new orders, making it difficult to increase their enthusiasm for raw material procurement. Manufacturers are holding on to signing orders for essential needs, and the new round of orders on site is expected to take about a month. The recovery of demand is not as expected.

Downstream cotton yarn market

This week, the price of cotton yarn has slightly increased with the rise of viscose staple fiber. As of September 6th, the average ex factory price of human cotton yarn (30S, ring spun, first-class) was 17625 yuan/ton, an increase of 250 yuan/ton from last week, with a weekly increase of 1.44%.

Future forecast

The upstream main raw material market price of viscose staple fiber may remain high, and the supply in the market is relatively tight. However, the new round of signing orders in the downstream market has basically ended, and the peak season has arrived. There is an expectation of an increase in the operating rate of human cotton yarn factories, which will drive the consumption of viscose staple fiber. Therefore, it is expected that the demand for viscose staple fiber may increase in the later stage, but it is difficult for the demand side to improve significantly in the short term. Viscose staple fiber manufacturers mainly deliver orders, and business analysts predict that the focus of the domestic viscose staple fiber market will remain stable in the short term, with little price fluctuation. The price is expected to be in the range of 13600-13700 yuan/ton.