test


Member ID:
Password: 
Stay logged in for 30 days
Forget Your Password?
close

login CCFGroup App

Insight | Time: Nov 3 2020 4:55PM
PE market remain in consolidation
 
Text size
October comes to an end, PE market remains in consolidation, petrochemical plants and traders offer accordingly. Downstream demand is healthy, and trading is relatively good.

In the late market, the market is basically caught in the game of "continuous startup of new capacity" and "the support from rigid demand", and the fluctuating pattern is more difficult to change.

First, let’s talk about the new start-ups.

2.7 million tons of new production capacity has been released in the first 10 months of this year. Among them, the products of Sinochem Quanzhou and Zhongke (Guangdong) Refining & Chemical Co., Ltd. are officially put on the market in mid-October.

Company Plant Capacity (kt/year) Startup time
Zhejiang Petroleum & Chemical Co., Ltd. HDPE/LLDPE 450 commenced in Feb, shut on Oct 27
Zhejiang Petroleum & Chemical Co., Ltd. HDPE 300 commenced in Feb, running at full rates
Hengli Petrochemical I HDPE 400 commenced in Mar, running at full rates
Liaoning Bora Enterprise Group (Bora) LLDPE 450 commenced in Aug, running at full rates
Liaoning Bora Enterprise Group (Bora) HDPE 350 commenced in Aug, running at full rates
Sinochem Quanzhou HDPE 400 commenced in Oct
Zhongke (Guangdong) Refining & Chemical Co., Ltd. HDPE 350 commenced in Oct
Total   2700  




In fact, looking back at the market price in 2020, each round of new start-ups has affected the market to some extent, causing spot prices to drop slightly.

Company Plant Capacity (kt/year) Startup time
Wanhua Chemical Group Co.,Ltd. HDPE 350 late-Oct
Wanhua Chemical Group Co.,Ltd. LLDPE 450 late-Oct
Haiguolongyou(Daqing Lianyi) LLDPE 200 Nov
Haiguolongyou(Daqing Lianyi) HDPE 200 Nov
Shaanxi Yanchang ChinaCoal II LDPE/EVA 300 mid-to-late Nov
Total   1500  


In November and December, 1.5 million tons of new plants are planned to be put into operation, including 800kt/year plant of Wanhua Chemical Group Co.,Ltd. and 400kt/year plant of Haiguolongyou(Daqing Lianyi), as well as 300kt/year plant of Shaanxi Yanchang ChinaCoal II. Wanhua Chemical Group Co.,Ltd. has started up its PE plant in late-Sep, and may start up its upstream cracker recently. It may produce smoothly in Nov. Haiguolongyou(Daqing Lianyi) has tested run smoothly in early Oct, and plans to start up in Nov. It may produce smoothly in late-Nov or Dec. And Shaanxi Yanchang ChinaCoal II plans to test run in mid-to-late Nov, and it will basically be stabilized in Dec or 2021.

In 2021, according to the current market news, there will be approximately 5 million tons of new capacity put into production.

Second, there is a continuous support from rigid demand:

At present, the demand of greenhouse film is still in its peak season, with more orders from downstream plants. The operating rate remains at high levels. The demand for mulching film is mild, but the average operating rate is around 50%.

Also, demand of other downstream products remains good, such as packaging film, protective clothing, parts and etc.

Protective clothing:



This is the Latest data released by National Health Commission by midnight, Nov 2, 2020. Also, the overseas epidemic data continued to refresh, triggering a second wave of coronavirus-led lockdowns across Europe. Therefore, the demand for protective clothing is still large in the future.

Packaging film:

Presales for the biggest online shopping spree in China - Double Eleven (Nov11), or Single's Day shopping festival – started on the midnight of Oct 21, with millions of people staying up late to get special discounts offered by live streaming promotions on e-commerce platforms. Transactions this year are expected to reach 856.74 billion yuan, according to a report from the China E-Commerce Research Center. This is mainly affected by people’s retaliatory consumption after the epidemic, but on the whole, there is a great demand for follow-up express packaging.

From the above point of view, the market may remain in consolidation in the short-term, and the up and down potential is both limited.
[RISK DISCLAIMER] All opinions, news, analysis, prices or other information contained on this report is provided by analyst of Zhejiang Huarui Information Consulting Co., Ltd (CCFGroup) as general market commentary and does not constitute investment advice. CCFGroup will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.
Related Articles
DCE LLDPE futures for Jan closes 2.13% higher
PE spot market offers mixed
DCE LLDPE futures for Jan opens 5 lower
PE market daily (Dec 3, 2020)
DCE LLDPE futures for Jan closes 1.53% lower
PE spot market inches down
DCE LLDPE futures for Jan opens 80 lower
PE market daily (Dec 2, 2020)
DCE LLDPE futures for Jan closes 1.33% lower
PE spot market moves lower
 
Research
Why did demand for fibers soar intensively in Oct?
PTA market operation and outlook
Development change of virgin PSF and recycled PSF and their ...
Polyester market review in H1 2020 and market outlook
PET bottle chip market to face challenges after an ...
Spandex market review in H1 2020 and market outlook
 
 

浙公网安备33010902000742号