December 1, 2022
Since the beginning of 2022, crude oil, coal, natural gas and other energy have soared, which has affected the price of bulk raw materials. As a result, the cost pressure of engineering plastics products increased, and the profit of polymerization enterprises was poor. In addition, the impact of the global macro inflation economic environment on factories at all levels of the industrial chain makes the industry market momentum weak. According to the data monitored by the business community, as of November 25, the decline of various engineering plastics products compared with the beginning of the month was from high to low, PA66 -4.95%, PA6 -2.11%, PC -2.09%, PET +0.33%, POM +1.22%. The recent domestic market peak season is over, and the demand contraction is hard to change. Polymerization enterprises and traders are caught in a dilemma where costs are under pressure while profits are allowed to go, and prices are almost all green.
Among engineering plastics, PA66 fell the most in November. On the upstream side, the domestic supply of hexamethylene diamine remained tight and the price was firm this month. Adipic acid fell due to the weak raw material market, and the support of PA66 cost fell. In terms of the industry's operating rate, PA66 enterprises continue to be affected by the tight supply of raw materials, the industry's load is limited, the operating level fluctuates between 60% - 70%, and the market's spot supply is stable and abundant, leading to an increase in the social inventory. In terms of demand, the terminal enterprises tend to maintain production just because they need to follow up on the delivery of goods this month. At the end of the traditional peak season, the enthusiasm for downstream goods preparation has further declined, and they have strong resistance to high price goods. As the shipping speed of merchants slows down, the center of gravity of prices loosens in the middle of the month, and the stalemate ends and starts to fall. By the end of the month, the average decline was more than 1,200 RMB/ ton, and the average price dropped to 24,000 RMB/ ton.
The domestic PA6 market fell in November due to volatility. Caprolactam and pure benzene in the upstream product chain continue to be in the downward channel, where caprolactam is in loose supply and PA6 costs are generally weak. In this month, the operating rate of domestic PA6 polymerization plants was lowered from more than 70% to 65%, with stable output and abundant supply. In addition, the production of new units in the early stage also put pressure on the supply side, and the average monthly drop of spot goods is about 300 yuan. In the downstream, the load of textile enterprises decreased significantly, falling to about 54% at the end of the month, and the stock of PA6 chips decreased. The market fundamentals are generally weak, and the market may continue to be weak.
In November, the domestic PC market fluctuated. The upstream bisphenol A has fallen since the end of September, and the price has gradually approached the cost line. However, the continuous downturn of phenol is difficult to support bisphenol A. After the price reduction, buyers were not enough to enter the market, and the market remained weak, dragging down the cost of PC. In terms of industry load, the utilization rate of PC capacity in November was roughly adjusted by shocks of 40% to 45%, and slightly recovered at the end of the month. As the industry neared the end of the year, the maintenance was gradually concentrated, and the supply side was significantly tightened, but the flow of goods in the market was slow, which hit the confidence of enterprises and merchants in price fixing. In addition, PC terminal enterprises are not in a high position to start production, and they need to maintain production just to get goods. The operators are on the empty side and keep a cautious wait-and-see attitude. The actual orders are mainly scattered and small, and the average spot price at the end of the month is about 17,950 RMB/ ton. On the whole, the weak market supply and demand and cost collapse coexist. It is expected that the PC market will continue to be dominated by weak consolidation market in the near future.
This month, the domestic PET market followed the weak decline that lasted for two months in the previous period. During the month, the crude oil price fell, the polyester dual raw material shock weakened, and the support for PET raw material end was insufficient. In the last ten days, due to the slight reduction of the pressure from the maintenance to the supply side of Hainan Eason, the price of repair is narrow, but the industrial load is still up to more than 85%, and the overall supply of goods on the site is abundant. The operating level of the terminal factory is medium to low, the enthusiasm for taking goods is not high, the actual order delivery is often delayed, and the health events affect the digestion speed of PET, so it is expected that the domestic PET market will be difficult to improve in the short term.
Among the brother products, only POM's price barely held steady in the month, but the market situation is hardly optimistic. First of all, although the supply of goods is tight, the domestic POM enterprises started at a high level. At the beginning of November, the capacity utilization rate was almost full, and the load at the end of the month was more than 80%. In addition, there was news that two production lines had resumed production recently, so the pressure on POM suppliers gradually emerged. The stock volume of terminal enterprises has been reduced due to the impact of lower commencement. In addition, the operators are cautious in operation and mainly digest inventory due to their bearish outlook on the future market. Most of the traders' shipments are scattered small orders, and their willingness to pay prices is gradually loosening. The market bears gradually dominate, and it is expected that the POM will end the stalemate and turn to decline in the short term.
The market of engineering plastics in November was generally negative. In addition to "external factors" such as global inflation and energy pressure, the weakening of its own purchase and sales is the main reason for the negative engineering plastics market in the short term. The load of automobile, textile, household appliances and other industries is lower, and the orders for engineering plastics are reduced. The industry may be difficult to break through from the downstream in a short period of downturn. According to the data monitored by the business community, it is very likely that the future market of engineering plastics products will continue to decline in China. It is recommended to focus on the international crude oil and upstream product market of various industrial chains.
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