27
Polyethylene prices may rise first and then fall in October during the traditional peak demand season
2023/10/9
According to the seasonal index of polyethylene prices in the past 5 years, the seasonal trend of polyethylene prices is obvious, and the third quarter belongs to the traditional peak demand season. Affected by the dominant market on the supply and demand side, the price center of the polyethylene market shifted upwards in September 2023, in line with seasonal patterns. Based on seasonal trends, fundamental drivers, and market sentiment, it is expected that the polyethylene market price will rise first and then fall in October, and the price center may shift downward in a narrow range.
The volatility of the polyethylene market in September follows seasonal patterns, with the price center shifting upwards
From the seasonal index of polyethylene prices over the past 5 years, the seasonal trend of polyethylene prices is obvious, and the third quarter belongs to the traditional peak demand season. According to the characteristics of seasonal fluctuations, in September of previous years, the seasonal index of polyethylene was above 1, indicating an upward trend in polyethylene prices; The price fluctuation trend in September follows seasonal patterns and is higher than the seasonal index. The main reason is that the crude oil price fluctuated and increased during the month. Although maintenance devices have been put into operation and resumed production, some varieties are still tight in stock. In addition, in the context of the traditional downstream demand peak season of "Jinjiu", the mentality of market participants has been boosted, and multiple factors have combined to support the continuous rise of market prices.
In September 2023, the market price center rose, consistent with the price fluctuation characteristics of the past five years, and higher than the average of the past five years. As of September 26, the monthly average price of LLDPE was 8537 yuan/ton, an increase of 2.22% month on month and 2.96% year on year.
Market supply and demand game, prices may rise first and then fall in October
In terms of domestic production, the polyethylene maintenance loss in October has decreased compared to September, expected to be 153900 tons. In addition, the annual production capacity of Ningxia Baofeng Phase III HDPE plant has been put into operation, gradually releasing production capacity. It is expected that the domestic supply of PE will increase in October. In terms of imports, it is expected that the PE import volume will slightly decrease in October. With the concentration of imported goods arriving at the port in September, there is a significant increase in supply pressure from importers. In the future, the supply intention of imported goods from the Middle East, the United States, and Southeast Asia towards the domestic market will decrease to a certain extent. But overall, the supply side of the polyethylene market is relatively abundant.
In terms of demand, the demand for agricultural film in October is currently in a peak season, supported by factors such as National Day and shopping festivals. Factory orders represented by packaging film are still acceptable, which may provide support for prices. However, based on the previous downstream procurement situation, most downstream factories should be cautious in purchasing raw materials in October and maintain a "use as you go" operation based on orders. It is expected that after the National Day holiday, except for some merchants who require a small amount of restocking, most of them have a strong wait-and-see atmosphere, with the intention of reducing inventory and risk digestion as the main focus. And in the middle and late stages, there may be a decline in new orders, making it even more difficult to form strong support for prices.
In summary, although October is the traditional peak season for the polyethylene industry, due to the release of most orders for the Mid Autumn Festival and National Day in the early stages, downstream acceptance of high prices is limited, and incremental release on the demand side is limited, which may restrict the continued high volume of polyethylene prices; Under the stable operating load of production enterprises, the expectation of supply increment still exists, and it is expected that the overall supply surface is relatively abundant. From the perspective of game factors on the supply and demand sides, it is expected that the polyethylene market price will rise first and then fall in October, and the price center may shift downward in a narrow range.
The volatility of the polyethylene market in September follows seasonal patterns, with the price center shifting upwards
From the seasonal index of polyethylene prices over the past 5 years, the seasonal trend of polyethylene prices is obvious, and the third quarter belongs to the traditional peak demand season. According to the characteristics of seasonal fluctuations, in September of previous years, the seasonal index of polyethylene was above 1, indicating an upward trend in polyethylene prices; The price fluctuation trend in September follows seasonal patterns and is higher than the seasonal index. The main reason is that the crude oil price fluctuated and increased during the month. Although maintenance devices have been put into operation and resumed production, some varieties are still tight in stock. In addition, in the context of the traditional downstream demand peak season of "Jinjiu", the mentality of market participants has been boosted, and multiple factors have combined to support the continuous rise of market prices.
In September 2023, the market price center rose, consistent with the price fluctuation characteristics of the past five years, and higher than the average of the past five years. As of September 26, the monthly average price of LLDPE was 8537 yuan/ton, an increase of 2.22% month on month and 2.96% year on year.
Market supply and demand game, prices may rise first and then fall in October
In terms of domestic production, the polyethylene maintenance loss in October has decreased compared to September, expected to be 153900 tons. In addition, the annual production capacity of Ningxia Baofeng Phase III HDPE plant has been put into operation, gradually releasing production capacity. It is expected that the domestic supply of PE will increase in October. In terms of imports, it is expected that the PE import volume will slightly decrease in October. With the concentration of imported goods arriving at the port in September, there is a significant increase in supply pressure from importers. In the future, the supply intention of imported goods from the Middle East, the United States, and Southeast Asia towards the domestic market will decrease to a certain extent. But overall, the supply side of the polyethylene market is relatively abundant.
In terms of demand, the demand for agricultural film in October is currently in a peak season, supported by factors such as National Day and shopping festivals. Factory orders represented by packaging film are still acceptable, which may provide support for prices. However, based on the previous downstream procurement situation, most downstream factories should be cautious in purchasing raw materials in October and maintain a "use as you go" operation based on orders. It is expected that after the National Day holiday, except for some merchants who require a small amount of restocking, most of them have a strong wait-and-see atmosphere, with the intention of reducing inventory and risk digestion as the main focus. And in the middle and late stages, there may be a decline in new orders, making it even more difficult to form strong support for prices.
In summary, although October is the traditional peak season for the polyethylene industry, due to the release of most orders for the Mid Autumn Festival and National Day in the early stages, downstream acceptance of high prices is limited, and incremental release on the demand side is limited, which may restrict the continued high volume of polyethylene prices; Under the stable operating load of production enterprises, the expectation of supply increment still exists, and it is expected that the overall supply surface is relatively abundant. From the perspective of game factors on the supply and demand sides, it is expected that the polyethylene market price will rise first and then fall in October, and the price center may shift downward in a narrow range.
JIN DUN CHEMICAL has built a special (meth) acrylic monomer manufacturing base in ZHEJIANG province. This makes sure the stable supply of HEMA, HPMA, HEA, HPA, GMA with high level quality. Our special acrylate monomers are widely used for thermosetting acrylic resins, crosslinkable emulsion polymers, acrylate anaerobic adhesive, two-component acrylate adhesive, solvent acrylate adhesive, emulsion acrylate adhesive, paper finishing agent and painting acrylic resins in adhesive.We have also developed the new and special (meth) acrylic monomers and derivatives. Such as the fluorinated acrylate monomers, It can be widely used in coating leveling agent, paints, inks, photosensitive resins, optical materials, fiber treatment, modifier for plastic or rubber field. We are aiming to be the top supplier in the field of special acrylate monomers, to share our rich experience with better quality products and professional service.
