test


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

login CCFGroup App

Insight | Time: Nov 18 2019 4:04PM
PP spot-futures basis to reduce with rising supply
 
Text size
With more and more plants restarting recently, the liquidity of spot sources has been improved and the spot-futures (the Jan futures contract) basis has been narrowed down gradually. Even in East China, the firmest region, its regional price spread is expected to narrow after the restarts of Ningbo Fortune and probability of the basis narrowing in the late market is also increasing.



Spot price in East China spirals higher compares with other regions after the National Day holiday under the influence of Ningbo Fortune’s turnaround and Zhongan Lianhe’s frequently short maintenance. In South China, the spot price is once higher than price in East China. However, as Grand Resource (Juzhenyuan) I have put into production, now the spot price in South China is discount with price in East China. Moreover, the high price in Ningbo, Jinhua and other areas recently have attracted some cross-regional arbitrage sources in Northwest areas.





Market spot sources are gradually increasing as plants restarts from turnaround and new start-ups run smoothly. Recently, since spot price spirals down and futures is fluctuating, spot-futures basis is narrowing down. It is expected that market sources in East China would increase significantly in the end of this week and next week, including supply form restarted plants and goods transfer from other regions. Market price in East China may drop sharply in the short-term. In plant news, basically no plants would shut for turnaround after Nov 15 except for few short maintenance. The operating rate have rebounded above 90% and supply would return to this year’s highest level. Therefore, the spot-futures basis may be narrowed down as spot price fall down sharply in the late market.
[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
Polypropylene market daily (Jul 8, 2020)
DCE PP futures for Sep closes 0.92% lower
PP granule market maintains high
DCE PP futures for Sep opens 16 higher
Traders' USD offers for major suppliers' PP
Polypropylene market daily (Jul 7, 2020)
DCE PP futures for Sep closes 0.100% higher
PP granule market fluctuates higher
DCE PP futures for Sep opens 65 higher
Polypropylene market daily (Jul 6, 2020)
 
Research
Analysis on production changes of global major cotton ...
Analysis on spandex for ear bands for masks in 2020
Analysis on spandex industry supply and demand
Recent coal-based MEG market overview and outlook
Polyester and downstream market operation and outlook
PTA: Impact of capacity expansion cycle and cost collapse
 
 

浙公网安备33010902000742号