1、 Price trend
This week, the PVC market first rose and then fell, and the futures market rebounded in the middle of the week before falling again over the weekend. The spot market has limited changes, and the mainstream spot market of SG-5 maintains a low range operation. According to the commodity analysis system, PVC fell by 0.63% this week.
Futures: The main PVC contract started at 4496 yuan/ton at the beginning of the week, reached a high of 4782 yuan/ton in the middle of the week, and fell back to around 4540 yuan/ton over the weekend. The overall range fluctuated, and the long and short games were intense. The move of positions and monthly swaps continued.
Spot: Approaching the weekend, the mainstream of East China SG-5 is 4450-4520 yuan/ton; The fluctuation range of spot goods is much smaller than that of futures, and traders ship along with them. Downstream buyers buy a small amount of inventory at low prices, and their willingness to hoard a large amount of goods is not strong.
2、 Factor analysis
Supply side: The maintenance period has not yet expired, and the operating rate is still at a medium low level
This week, the maintenance of industry equipment is still ongoing, and some early maintenance equipment is gradually planned to resume production. The overall operating rate remains above 70%. The maintenance will gradually end in late August, and there is an expectation of a rebound in production in the later stage, which poses a risk of supply pressure rebounding.
Calcium carbide method: Due to the impact of corporate losses, there are many instances of proactive load reduction and maintenance, with a utilization rate of over 70%; The disturbance of power in the northwest indirectly affects the supply of calcium carbide, and the price of calcium carbide remains stable. Calcium carbide production enterprises continue to operate at a loss.
Ethylene process: Due to the transmission of international crude oil geopolitical fluctuations, the cost of ethylene raw materials fluctuates, and the US Iran situation repeatedly disturbs cost expectations. The ethylene process is also in a loss making state, and the load elasticity of the equipment changes with the pace of maintenance.
Demand side: Affected by the off-season, overall performance is sluggish
Currently at the end of the traditional off-season, downstream overall production remains low, and structural differentiation is evident. Pipe material: Due to the sluggish start of new real estate construction, the production rate remains around 30%, with insufficient orders. The product factory mainly purchases for essential needs, and the inventory of raw materials remains low. Profile: performs slightly better than pipe, with nearly 40% of production starting. Some orders come from stock renovation and old renovation projects, but the increment is limited. Export: Overseas demand is flat, coupled with trade barriers in some regions, and there is no significant increase in export orders compared to the previous period, making it difficult to form a strong driving force. Downstream consumers are generally observing and not actively replenishing inventory in large quantities. The real improvement in demand will need to be verified during the traditional peak season in September.
Inventory: Inventory is still running at a medium to high level
This week, PVC continues its trend of reducing inventory, but the effect is average. Currently, the absolute value of inventory is high, and it is difficult to fundamentally alleviate the market supply pressure. Upstream factory inventory has slightly declined; Difficulty in reducing social inventory has suppressed prices. Overall, the extent of destocking is limited, mainly relying on upstream maintenance to reduce production, rather than downstream demand increasing procurement.
Cost aspect:
Calcium carbide: The prices in the main production areas remain stable, and the power supply situation of power plants has become a variable for calcium carbide. The cost forms a bottom support for PVC, but the upward drive is insufficient. According to the Commodity Analysis System of Shengyi Society, the price of calcium carbide increased by 0.41% this week. As shown in the chart, calcium carbide has reached a temporary high.
3、 Future prospects
In the short term, PVC is still mainly in a range oscillation pattern, and the supply and demand fundamentals are difficult to shake. It is difficult to break out of a unilateral market in the short term. On the one hand, production enterprises continue to suffer losses, reducing production to support prices and locking in downward space. On the other hand, the combination of high inventory and weak demand pattern makes it difficult for the market to break through the upward trend. Overall, the market will continue to fluctuate in the coming week.
| http://www.polyvinylalcohols.com |