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There are still downside risks in polyolefin market in the medium term

wallpapers News 2020-10-20

crude oil plummeted in October, which increased the profits of oil to olefins by nearly 90 times greatly improved the production power of manufacturers. In addition, from the end of this year to the first half of next year, coal to olefin projects will be put into operation in large areas, polyolefin production will usher in a peak. However, China's economic downturn risks will weaken the downstream dem for polyolefins, the oversupply of PE PP is difficult to ease, the futures price is facing downward pressure. The profit advantage of

stimulates the expansion of production scale. Since the second half of this year, the international crude oil price has entered a downward channel. On the last trading day of September, the decline accelerated. On October 15, US crude oil futures fell below $80 / barrel for the first time in more than two years, IPE oil distribution futures fell below $85 / barrel. For the whole month of October, US crude oil fell by 10.33% oil distribution by 9.11%. At the daily level, although the oil price is supported near $80 / barrel, with the complete withdrawal of the Federal Reserve from QE, the strengthening of the US dollar, the continued rise of potential crude oil production, the medium-term oil price is expected to reach the $75 / barrel mark. The drop of crude oil price of

led to the rise of oil to olefin production profit: on June 13, the profit of oil to PE was 22 yuan / ton, on October 15, its profit had risen to 1980 yuan / ton, nearly 90 times higher. The increase of profits will certainly stimulate the enthusiasm of manufacturers, the supply of PE PP will continue to exp. Some maintenance units of

resumed production successively in November. The PE PP units of

were overhauled more recently, the output decreased, which provided support for polyolefin prices. However, some units are scheduled to resume production in November, the pressure of sufficient supply is still difficult to ease.

at the same time, from the second half of this year to next year, the production capacity of coal to olefin projects planned to be put into operation in China will reach 4.6 million tons / year, the market will be greatly impacted.

PP inventory continued to accumulate, PE was more likely to be transferred to production.

did not fall significantly in October as expected after the price of upstream raw materials fell sharply, but PP inventory continued to grow. The reason may be that petrochemical enterprises choose to protect the price in this oil price slump. The downstream dem side thinks that there is still room for price decline, the enthusiasm of stock preparation is reduced, which leads to the accumulation of upstream inventory. From the perspective of continuous increase of PP ex factory price in recent week, PP inventory is expected to continue to accumulate, which will suppress the future price. The inventory pressure of

LLDPE is relatively small, mainly because HDPE price is higher than LLDPE price at present. Taking Daqing, Sinopec East China as an example, the ex factory price of HDPE was 100 yuan / ton lower than that of LLDPE in May this year. The price of HDPE rose from June to August with a price difference of 50-300 yuan / ton. However, the price of LLDPE dropped sharply from September to October, the price difference between them exceeded 1000 yuan / ton. The current price differential relationship makes manufacturers more motivated to produce HDPE. Manufacturers with full density devices are likely to make dynamic adjustments to their production situation, reduce LLDPE production in the later stage turn to HDPE production, which will help LLDPE de stocking. The downstream dem of

is not optimistic,

weakening of China's macro-economy also has a negative impact on the dem for PE PP. ICIS said that in the past, the downstream dem for polyolefins grew at a rate of 15% - 20%, but now the growth rate has dropped below 20%. The third quarter of

should have been the peak season of film production dem, but the total production of plastic film in the third quarter of this year was only 3.08 million tons, which was 130 thous tons lower than that of the second quarter, with an average monthly increase of 6.10% an average increase of 12.26% in the second quarter; the total production of agricultural film in the third quarter was 530500 tons, an increase of 12400 tons compared with the second quarter, but the growth rate was less than that of the second quarter. The most surprising thing about

is the decline in refrigerator production. Judging from the past data, summer should be the peak season for refrigerator production, but in the third quarter of this year, the output of household refrigerators dropped for three consecutive months year-on-year, the total output of this quarter hit a new low in recent four years. In the traditional sense,

in the traditional sense, the output of household washing machines is relatively high near winter. In the fourth quarter of last year, the total output of washing machines was 20.2237 million units, compared with 18.624 million units in the same period of the previous year. However, according to the sales situation from March to September this year, the output of only two months increased in seven months, the year-on-year decline in September was more than 10%. The market was pessimistic about the production situation in the fourth quarter.

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