PVC: Futures policy expectations and de-warehouse cost support, red Friday again, spot prices rise

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August 18, 2023, 4:06 PM

PVC futures analysis: August 18 V2401 contract opening price: 6140, highest price: 6248, lowest price: 6140, position: 559210, settlement price: 6203, yesterday settlement: 6089, up: 114, daily trading volume: 795933 lots, precipitated capital: 2.438 billion, capital inflow: 38.7 million.

List of comprehensive prices by region: yuan / ton

Area	Price 8.17	Price 8.18	Rise and fall	Remarks
North China	5920-6000	6020-6070	100/70	Send to cash remittance
East China	5960-6040	6090-6130	130/90	Cash out of the warehouse
South China	6060-6130	6160-6250	100/120	Cash out of the warehouse
Northeast China	5900-6000	5950-6100	50/100	Send to cash remittance
Central China	6000-6070	6100-6170	100/100	Send to cash remittance
Southwest	5840-6000	5940-6100	100/100	Send to cash remittance

PVC spot market: China PVC market mainstream transaction prices rose, red Friday reappeared. Compared with the valuation, North China rose 70-100 yuan / ton, East China 90-130 yuan / ton, South China 100-120 yuan / ton, Northeast China 50-100 yuan / ton, Central China 100 yuan / ton, and Southwest China 100 yuan / ton. Upstream PVC production enterprises factory prices are mostly raised by 50-100 yuan / ton, some enterprises increase by a larger extent, it can be said that the early weak did not actively follow up with the decline. Ethylene companies also synchronously raised quotations, PVC futures are strong shock uplink, the spot market traders offered a price higher than yesterday, and some merchants quoted again by about 20 yuan / ton, but the high price is more difficult to close the deal, most of the actual single there is a certain room for negotiation, after the futures price uplink, there is no price advantage, some brands supply is tight and the price is slightly higher. On the whole, the prices of the two cities are rising, there is a certain deal in the low price range in the morning, it weakens in the afternoon, the purchasing enthusiasm of the downstream of the high price is not high, and the wait-and-see intention is obvious.

Futures point of view: PVC2401 contract night futures prices opened low and high, intraday prices fluctuated upward. After the start of morning trading, the futures price rose further, and then began the state of high and narrow finishing, and the high shock continued after the highest price of 6248 in the afternoon. 2401 contracts range from 6140 to 6248 throughout the day, with a spread of 108. 01 contracts with an increase of 352 positions and 559210 positions so far. The 2309 contract closed at 6196, with 176794 positions.

PVC Future Forecast:

Futures: PVC2401 contract prices showed an obvious upward trend, opening at a low price, maintaining a good rally above 6200 at the end of the day, but the all-day position remained basically unchanged compared with yesterday. The technical level shows that the openings of the three tracks of the Bolin belt (13, 13, 2) are all upward, the KD line of the daily line shows a golden fork trend, the MACD line trend of dead fork trend shrinks, and the weekly line shows a certain upward mood. Commodities rose in the afternoon, most of the main Chinese futures contracts rose at midday, the Container Index (European line) rose more than 17%, methanol, soda ash, polypropylene (PP) rose more than 3%, iron ore and plastics rose nearly 3%. On the whole, PVC also followed the mood upward, coinciding with the short-term futures prices on Friday or continue to run around the narrow range of the middle rail, observing the performance of the upper pressure of 6280.

Spot: first let's look at the port from the policy expectations. The central bank released China's monetary policy implementation report for the second quarter of 2023, proposing to adapt to the new situation of major changes in supply and demand in the real estate market, timely adjust and optimize real estate policies, and promote the stable and healthy development of the real estate market. PVC fundamental inventory data show that the social inventory to the warehouse of about 8000 tons, on the one hand, the delivery of export orders, on the other hand, the generation and delivery of warehouse receipts, there is no volume in the lower reaches of the week as a whole. The price of calcium carbide at the cost port is generally raised by 50-100 yuan per ton, which is obviously supported by the PVC of the calcium carbide method, so the combined factors support the upward price of the two cities. On the outer disk, international oil prices rebounded after falling for three consecutive days because of a weaker dollar and a technical rebound. In addition, expectations of a global supply crunch and concerns about high interest rates in the US also boosted the oil market. On the whole, PVC spot prices fluctuate mainly in a narrow range in the short term.

PVC spread arbitrage analysis:

Arbitrage Analysis of PVC spread
PVC	Contract price difference	8.17	8.18	Rate of change
	V2309 collection	6133	6228	95
	Average spot price in East China	6000	6110	110
	Average spot price in South China	6095	6205	110
	PVC2309 basis difference	-133	-118	15
	V2401 collection	6169	6259	90
	V2309-2401 closed	-36	-31	5
	PP2309 collection	7450	7574	124
	Plastic L2309 collection	8137	8302	165
	V--PP basis difference	-1317	-1346	-29
	Vmure-L basis difference of plastics	-2004	-2074	-70

China PVC Index: according to Tudor data, the spot index of China's calcium carbide PVC rose 102.55, or 1.707%, to 6107.29 on Aug. 18. The ethylene method PVC spot index is 6560.82, up 32.52, the range is 0.498%, the calcium carbide method index rises, the ethylene method index rises, the ethylene method-calcium carbide method index price difference is 451.53.

PVC warehouse receipt daily:

Variety	Warehouse / branch warehouse	8.17 warehouse orders	8.18 warehouse orders	change
Polyvinyl chloride	China Reserve shares	501	501	0
	Guangzhou materials	141	141	0
	China Central Reserve Nanjing	360	360	0
Polyvinyl chloride	Cosco sea logistics	231	231	0
	Zhenjiang Middle and far Sea	231	231	0
Polyvinyl chloride	Zhejiang International Trade	2,762	2,762	0
Polyvinyl chloride	Peak supply chain	1,000	1,000	0
Polyvinyl chloride	Jiangyin Xiefeng	1,180	1,180	0
Polyvinyl chloride	Benniu Port, Changzhou	6,288	6,288	0
Polyvinyl chloride	Jiangsu Zhengsheng	2,031	2,031	0
Polyvinyl chloride	Changxing, Zhejiang	120	120	0
Polyvinyl chloride	Jiangsu Yanjin	2,467	2,467	0
Polyvinyl chloride	Chuanhua mandarin	50	50	0
Polyvinyl chloride	Xiamen Xiangyu (Shanghai Xiangyu)	100	100	0
Polyvinyl chloride	Zhejiang tomorrow (Benniu Port)	298	298	0
Polyvinyl chloride	Zhejiang tomorrow (Zhejiang International Trade)	149	149	0
Polyvinyl chloride	Products Zhongda Chemical Industry (Benniu Port)	900	900	0
Polyvinyl chloride	Products Zhongda Chemical Industry (Railway Changxing)	300	300	0
Polyvinyl chloride	Yongan Capital (Benniu Port)	1,200	1,200	0
Polyvinyl chloride	Specialty petrochemical (Benniu Port)	2,399	2,399	0
Polyvinyl chloride	Specialty Petrochemical (Zhejiang International Trade)	1,800	1,800	0
Polyvinyl chloride	Sino-Thai Duojing (Zhejiang International Trade)	1,238	1,238	0
Polyvinyl chloride	Tiantai International Trade (Benniu Port)	600	600	0
PVC subtotal		25,614	25,614	0
Total		25,614	25,614	0