Market prices:
As for PG, downstream production has been suspended before the holiday, and only a small number of factories have continued to operate. The downstream raw material consumption is slow, the overall demand is weak, and the market atmosphere is weak around the Spring Festival. Although supply-side inventory is under pressure, the decline in the price of raw materials has a large negative impact. However, because the downstream recovery was slow, suppliers preferred to take measures to reduce load, by suspending production or transferring inventory to ports. The supplier’s willingness to adjust prices is not high. However, over time, traffic restrictions have gradually loosened, and the downstream has gradually resumed. The market’s trading atmosphere is heating up, and suppliers, driving by their willingness, tend to discuss shipments at low prices.
In terms of DMC, the downstream has a modest amount of replenishment before the holiday, and the supplier’s inventory remains low. During the holiday, some inelastic demand supports the supply side, so inventory pressure has been relatively controllable. After the holiday, the downstream recovery is slow, and it is still maintain by inelastic demand. Affected by the raw materials and inventory pressure of co-product MPG, the overall device load is also slowly decreasing. Trading has not resumed, and suppliers are not willing to adjust prices. With the passage of time, transportation has resumed, but downstream factories are slow to resume work. With the willingness of suppliers to ship, the focus of trading has shifted downward.
Market supply:
From January 23 to February 13, a lot of transportation is restricted and the supply of raw materials is difficult. Most downstream factories stop work before the festival, and the support from inelastic demand is general. Under the pressure of less shipment, most PG and DMC devices have reduced their load or stopped production, and the overall start-up has dropped significantly. In recent days until February 20, transportation resumed, production units restarted, and some units increased their load. The overall load increased, but it was still relatively low before the holiday.
Most of Shandong’s production units are still in operation. Although the market is slowly recovering and the inventory is under pressure, they can still maintain the operation because the port shipments can alleviate the pressure on the inventory and reduce the load on the equipment. Only Wells was limited by the poor transportation of raw materials after the festival, and it was stopped for a short time. After the traffic resumed, it also resumed work. Shandong PG and DMC units maintain relatively high load operation.
Market demand:
PG: The main downstream unsaturated resins were withdrawn from the market before the festival, and only a small amount of polyether needed supply. As the consumption of raw materials is slow, the support to suppliers is weak. Although the downstream operating load is slowly increasing, the resin load increase is slow, so the demand for PG is limited.
DMC: Most of the main rigid demand products polycarbonate devices have low load operation. Restricted by raw materials after the holiday, the device load was reduced again, and the demand for DMC was weak. With the loosening of transportation restrictions, the downstream plants plan to resume production, which will provide certain support for demand of DMC.
Market transportation:
In terms of transportation, after the holiday returns, traffic restrictions are large, logistics companies resume work slowly, and transportation vehicles and drivers are difficult to find. With the passage of time and government support, transportation restrictions will gradually loosen, transportation within the province is basically smooth, and inter-provincial transportation is subject to different regional policies and differences. The trading atmosphere in the market has gradually become active.
Market prediction:
PG: After the suppliers tend to delivery at low prices, the inventory pressure is not large. With the downstream slowly recovering, it is expected that the resin load will increase greatly next week, and the demand increase will be significantly improved. At the same time, the PG manufacturing devices will also be actively resumed. With both supply and demand increasing, it is expected that the PG market will narrow up, and the main focus will be negotiation games.
DMC: After the rigid demand is concentrated in the downstream, the supply pressure of the supplierS can be controlled, and the willingness to ship at a low price is reduced. However, the traditional downstream recovery is slow, the demand for the terminal is not well transmitted, and the production stops are actively resumed. Both the supply and demand sides have increased, and the power to explore the market price is limited. It is expected that the DMC market will be stabilized in a narrow range next week.