PVC Weekly: Futures hit an annual low, but bottomed out and rebounded significantly. Spot showed a long-lost upward trend during the week

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June 15, 2023, 4:21 PM

I. Analysis of China's PVC market

1. Summary of China's PVC market.

This week (2023.06.09-2023.06.15) the spot market prices rose slightly in a comprehensive comparison. First of all, the main intraday contracts showed a recent low of 5596 within 09 weeks, and then the futures prices bottomed out and rebounded. Spot market prices also showed a certain upward performance at the low during the week. The influencing factors of the week: 1. The futures market began to trade horizontally since last Friday, and then appeared the lowest point on Tuesday to break the previous low, which was mainly low in the first half of the week. However, at the lowest point, the price bottomed out and rebounded in the later period, showing an obvious trend of position reduction. 2. The main factor for the upturn in commodity sentiment during the week is that on June 13, the people's Bank of China launched a seven-day reverse repurchase operation in the open market of 2 billion yuan, and the central bank's open market operating interest rate fell by 10 basis points, which is conducive to boosting market confidence. it is conducive to stabilizing the financing costs of the main body of the market, which reflects the balance of multiple policy objectives. Commodity sentiment warmed up and continued to ferment upward on Wednesday. 3. The current two cities of PVC also showed a significant rise because of the news, but the fundamentals of PVC itself were weak, including a continuous decline in calcium carbide prices during the week, and Taiwan Formosa Plastics's July PVC quotation was reduced by 20-30 US dollars / ton. Therefore, its own fundamental support is not sufficient. 4. On Thursday, the National Bureau of Statistics announced that investment in real estate development across the country fell 7.2% from January to May compared with the same period last year. The real estate data are weak again. 5. On the outer disk, the Federal Reserve Monetary Policy Committee (FOMC) announced after its meeting that the target range of the federal funds rate would remain unchanged at 5.0% to 5.25%. On the whole, the two markets showed a certain upward trend of rebound during the week. According to the comparison of valuation, North China rose 50-55 yuan / ton, East China rose 30-55 yuan / ton, South China rose 40 yuan / ton, Northeast China fell 50 yuan / ton, Central China rose 50 yuan / ton, and Southwest China rose 35 yuan / ton.

Futures: week PVC09 contract prices broke the previous low, an annual low of 5596, but then hit the bottom of the upside short order profit-taking. The volume of positions changed during the week, including 14433 positions on Friday, 13666 on Monday, 7091 on Tuesday and 42763 on Wednesday. Thursday futures showed a V-shaped trend as a whole, and the high price did not exceed Wednesday, followed by a decline in futures prices, but the overall long and short positions were evenly matched. Among them, the extra drive is 24.5% and the empty one is 24.2%. On Thursday, the position was increased by 16050, and the position in the PVC09 contract closed at 907283 hands, with the closing price of 5730.

Comparison of the lowest and highest prices for PVC09 contracts
Date	Lowest price	The highest price	Rise and fall
6.9	5627	5710	83
6.12	5645	5742	97
6.13	5596	5697	101
6.14	5695	5789	94
6.15	5680	5785	105

2. Market analysis of mainstream consumer areas in China.

North China: Hebei PVC market prices rose in the week, but the atmosphere is weak, spot transactions become weak, the actual single transaction is not much. As of Thursday, type 5 materials including tax 5480-5520 yuan / ton delivered, Inner Mongolia factory to 5300-5350 yuan / ton. Northern region basis offer 09 contract-(350-400-500).

East China: Changzhou PVC market is up-regulated within the week, but the trading is lukewarm, the basis does not change much, downstream bargain hanging order replenishment, inquiry and procurement enthusiasm is general. As of Thursday, the reference for the current remittance of type 5 calcium carbide materials is 5600-5650 yuan / ton (excluding packing). East China basis offer 09 contract-(50-150).

South China: Guangzhou PVC market prices rose slightly within the week, a price offer and point price supply co-exist alternately, downstream procurement enthusiasm is not high, the spot transaction atmosphere in the market is weak. As of Thursday, ordinary type 5 calcium carbide spot pick-up mainstream transaction reference 5650-5730 yuan / ton. South China base offer 09 contract-(0-50) good fans + 20. Ethylene method offer 1000 to 5760 yuan / ton, Dagu 1000 spot offer 5720-5750 yuan / ton.

Taiwan Plastics of China continued to lower its pre-sale price by US $20-30 / tonne in July, while the Indian market fell by US $20 / tonne compared with the second cut in June to US $760 / tonne CIF India; other regions fell by US $30 / tonne, CFR China at US $755 / tonne, CIF Southeast Asia at US $750US / tonne and FOB China's Taiwan at US $710USD / tonne.

July shipping price of Formosa Plastics in Taiwan Province of China: (USD / ton)

Region / time	CFR India	CFR China	CFR Southeast Asia	FOB Taiwan of China
January	840	805	800	770
February	930	875-885	870-880	840
March	970	925	920	880
April	900	865	860	820
May	820	805	800	760
June	800	785	780	740
July	760	755	750	710

3. Comparison of cash base difference in PVC period

Arbitrage Analysis of PVC spread
PVC	Contract price difference	6.9	6.12	6.13	6.14	6.15
	V2309 collection	5696	5664	5683	5756	5730
	Average spot price in East China	5570	5560	5550	5650	5610
	Average spot price in South China	5665	5640	5640	5705	5690
	PVC2309 basis difference	-126	-104	-133	-106	-120
	V2401 collection	5705	5673	5699	5769	5747
	V2309-2401 closed	-9	-9	-16	-13	-17
	PP2309 collection	6946	6894	6925	6968	6985
	Plastic L2309 collection	7745	7657	7712	7794	7789
	V--PP basis difference	-1250	-1230	-1242	-1212	-1255
	Vmure-L basis difference of plastics	-2049	-1993	-2029	-2038	-2059

4. PVC warehouse receipt daily

Variety	Warehouse / branch warehouse	6.9 warehouse orders	6.12 warehouse orders	6.13 warehouse orders	6.14 warehouse orders	6.15 warehouse orders
Polyvinyl chloride	Zhejiang International Trade	851	851	1,051	1,051	1,051
Polyvinyl chloride	Jiangyin Xiefeng	609	609	609	609	609
Polyvinyl chloride	Benniu Port, Changzhou	1,387	1,387	1,387	1,487	1,487
Polyvinyl chloride	Jiangsu Zhengsheng	325	827	827	827	827
Polyvinyl chloride	Jiangsu Yanjin	1,681	1,681	1,681	1,681	1,681
Polyvinyl chloride	Products Zhongda Chemical Industry (Benniu Port)	900	900	900	900	900
Polyvinyl chloride	Products Zhongda Chemical Industry (Railway Changxing)	300	300	300	300	300
Polyvinyl chloride	Yongan Capital (Benniu Port)	798	798	798	798	798
Polyvinyl chloride	Specialty petrochemical (Benniu Port)	2,399	2,399	2,399	2,399	2,399
Polyvinyl chloride	Specialty Petrochemical (Zhejiang International Trade)	1,313	1,307	1,307	1,307	1,307
Polyvinyl chloride	Sino-Thai Duojing (Zhejiang International Trade)	1,238	1,238	1,238	1,238	1,238
PVC subtotal		11,801	12,297	12,497	12,597	12,597
Total		11,801	12,297	12,497	12,597	12,597

5. Future forecast

Futures: PVC09 contract price appears the phenomenon of horizontal trading around the middle track, in which the operation of the high point has not been further broken, but both sides of the position increase, long and short positions have been opened, so the trend of the futures market under the narrow fluctuation is insufficient at present. The overall commodity sentiment has also entered the trend of technical adjustment after two consecutive days of rebound and rise. The technical level shows that the opening of the three tracks of the Bolin belt (13, 13, 2) is flat, and the MACD of the daily level shows a golden fork, but the weekly and monthly lines do not close. The continuous rise of commodities under the central bank policy is faintly meant to come to an end, and in the case of insufficient support from PVC fundamentals, it is expected that the performance of futures prices in the short term will continue to focus on the range of 100 points above and below 5710 in the middle track.

Spot aspect: & the continuous rebound of the two cities in the nbsp; period did not lead to an improvement in the trading of the spot market. On the contrary, downstream product enterprises do not have a new intention to replenish goods except for rigid demand. We also mentioned that hedgers have taken the goods before. But on Thursday, some spot market prices began to fall, and the transaction turned bad. From the perspective of PVC fundamentals, it is still weak, but the long-term downturn of the PVC market suppresses the PVC operating rate. This week, the overall PVC operating load rate is 68%, down 4 percentage points from the previous month. However, the real estate continues to perform poorly on the basis of insufficient orders of upstream and downstream products enterprises, and the high inventory caused by the restriction of its demand has always been a problem in the industrial chain. PVC fundamentals have no bright spots to speak of, but the recent rebound trend can be seen that although PVC fundamentals exist calcium carbide downside, and real estate data performance is poor, and iterative Taiwan Formosa Plastics prices fell in the three negative cases, the overall current performance did not appear weak but more in line with the overall commodity trend, short-term PVC will continue to be mainly narrow.

6. China PVC Index

According to Tuduoduo data, the PVC spot index of China's calcium carbide method fell 21.93, or 0.391%, to 5588.79 on June 15. The PVC spot index of ethylene method was 5910.26, up 8.55%, with a range of 0.145%. The calcium carbide index decreased, the ethylene index increased, and the ethylene-calcium carbide index spread was 321.47.

7. The market price of PVC this week

Unit: yuan / ton

Region	Date	Price specification	Price range	2023/6/8	2023/6/15	Rise and fall
North China	Hebei	Send to cash remittance	5490-5530	5460	5510	50
	Tianjin	Send to cash remittance	5490-5530	5460	5510	50
	Linyi	Send to cash remittance	5530-5570	5495	5550	55
East China	Shanghai	Cash out of the warehouse	5490-5680	5530	5585	55
	Hangzhou	Cash out of the warehouse	5570-5670	5590	5620	30
	Changzhou	Cash out of the warehouse	5570-5650	5560	5610	50
	Yuyao	Cash out of the warehouse	5460-5670	5510	5565	55
	Xiamen	Cash out of the warehouse	5650-5730	5650	5690	40
South China	Guangzhou	Cash out of the warehouse	5650-5730	5650	5690	40
South China	Shenzhen	Cash out of the warehouse	5610-5810	5670	5710	40
Northeast China	Shenyang	Send to cash remittance	5450-5500	5525	5475	-50
Central China	Zhengzhou	Send to cash remittance	5580-5640	5560	5610	50
Central China	Wuhan	Send to cash remittance	5650-5660	5605	5655	50
Southwest	Chengdu	Send to cash remittance	5400-5600	5465	5500	35
Southwest	Chongqing	Send to cash remittance	5400-5600	5465	5500	35

8. List of equipment in production enterprises this week

List of equipment maintenance in PVC Enterprises in China
Technics	Enterprise name	Production capacity	Device change
Calcium carbide method	Salinization of Mount Tai	10	Parking on September 29th, 2022, recovery time to be determined
	Henan Shenma	30	Parking on August 12, 2022, recovery time to be determined
	Hengyang Kingboard	22	Parking on March 1, 2023, recovery time to be determined
	Salt lake Haina	20	Parking maintenance on March 28, 2023, recovery time to be determined
	Shandong Dongyue	13	Overhauled on March 25, 2023, recovery time to be determined
	Yibin Tianyuan	38	First-line overhaul, resumed on June 9th
	Haohua Aerospace	40	It is expected to be overhauled on May 24 and resumed on June 11, 2023.
	Shanxi Yushe	40	Scheduled for overhaul on June 15, 2023
	Shanxi Jintai	30	Planned for overhaul on June 5, 2023 and expected to resume on June 15
	Sino-Thai chemistry	82	Planned for maintenance on June 6, 2023 and expected to resume on June 26
	Ruiheng, Shanxi	40	The second phase of 400000 tons overhaul on June 13, 2023, and resumed on June 14.
	Heilongjiang Haohua	30	It is expected to be overhauled on June 20 and resumed on June 25.
	Ordos	40	It is expected that the first factory will be overhauled from June 5 to 20.
	Inner Mongolia is suitable for change.	30	Planned maintenance from June 10 to 17, 2023
	Medium salt Inner Mongolia	40	It is scheduled to be overhauled for about 7 days on July 25, 2023, and it is expected to resume on August 2.
Ethylene process	Yangmei Hengtong	30	It will be overhauled for about one month on May 10, 2023, and the recovery time will be determined.
	The development of Tianjin Bohua	80	One-line rest on May 25, 2023, scheduled for recovery on June 10
	Jiahua Energy	30	The equipment broke down for 10-15 days on June 7, 2023, and the load was reduced by half. It is expected to recover on June 21, 2023.
	Suzhou Huasu	13	Parking maintenance on June 5, 2023 and expected to resume on June 25
	Shanghai chlor-alkali	6	Planned maintenance from June 15 to July 5, 2023

2. PVC paste resin

1. Market analysis and forecast of PVC this week.

This week (2023.06.09-2023.06.15) PVC paste resin market trend is relatively flat, prices have not been significantly adjusted, maintain last week's weak and stable level, market trading atmosphere is general, downstream procurement performance is weak and stable, glove materials and large plate materials market have not seen obvious fluctuations. Market price: PVC paste resin large plate price 6700-7500 yuan / ton, glove material sent to the price 7200-7500 yuan / ton, the actual transaction price negotiation. At present, the trend of PVC paste resin market cost calcium carbide market is not good enough, the supply side enterprise inventory pressure is not reduced, and there are regional differences, the downstream demand is weak, the contradiction between supply and demand still exists, it is expected that the short-term PVC paste resin market will maintain a weak situation.

2. Statistics on the start-up of PVC paste resin manufacturers this week

This week (2023.06.09-2023.06.15) the operating rate of PVC paste resin enterprise is 51.62%. Sichuan Xinjin Road Group Co., Ltd. PVC paste resin device (20 000 tons / year) has not been put into production; Jiyuan Fangsheng Chemical Co., Ltd. PVC paste resin device (60 000 tons / year) production process is micro-suspension method, paste resin device is still shut down. Binzhou Zhenghai Group-Wudi Xinchuang Ocean Technology Co., Ltd. PVC paste resin device (40, 000 tons / year) was stopped for maintenance on April 23, 2021, but not in production. Qinghai Salt Lake Haina Chemical Co., Ltd. PVC paste resin device (35000 tons / year) parking maintenance, start-up time to be determined. Medium Salt Inner Mongolia Chemical PVC paste resin plant (80, 000 tons / year) was stopped and overhauled for about 7 days on July 26th, 2023. Shenyang chemical PVC paste resin plant (200000 tons / year) was stopped and overhauled for about 7 days in the middle and last ten days of July 2023.

Manufacturer name	Production capacity (10,000 tons / year)	Maintenance plan
Shenyang Chemical Industry	20	Parking and overhaul for about 7 days in mid-late July, 2023
Shandong Langhui Oil	14	Normal
Anhui Tianchen	13	Normal
Inner Mongolia Junzheng	10	Normal
Yidong Dongxing, Inner Mongolia	10	Normal
Jiangsu Corning Chemistry	10	Normal
Xinjiang Tianye	10	Normal
Medium salt Inner Mongolia	8	It is estimated that the parking will be overhauled for about 7 days on July 26, 2023
Xinjiang Zhongtai	9	Normal
Three friends of Tangshan	8	Normal
Inner Mongolia Chenghongli	8	Normal
Formosa Plastics Industry (Ningbo)	7	Normal
Ningxia Yinglite	4	Normal
Jining Bank of China	4	Parking on March 29th, 2023, no recovery plan for the time being
Landscape in Yichang, Hubei Province	4	Normal
Binzhou Zhenghai Group-Wudi newly created Ocean	4	Maintenance on April 23, 2021, no recovery plan for the time being
Qinghai Salt Lake Haina Chemical Industry	3.5	Overhauled in mid-April 2022, no recovery plan for the time being
Sichuan Xinjin Road Group	2	Normal

III. Key analysis of related chlor-alkali products

1. Calcium carbide

This week (2023.06.09-2023.06.15) China's calcium carbide market maintained a comprehensive downward trend, prices in various regions continued to decline and set new lows, and mainstream ex-factory quotations and receiving prices were lowered to varying degrees, of which factory quotations were reduced by 100-300 yuan / ton. the downstream receiving price has been reduced by 100-225 yuan / ton, and the overall operation of the market is still weak. Last Friday, enterprise shipments were not smooth, while downstream enterprises waiting for unloading increased, and the PVC market continued to be weak, dragging down the calcium carbide market. Weekend supply is adequate, inventory pressure is not reduced, the main downstream PVC enterprises calcium carbide procurement situation has not significantly improved, so prices have been reduced to varying degrees. At the beginning of this week, the market in most areas maintained a stable trend, the demand affected by the slight recovery of maintenance equipment in the lower reaches increased, and the decline in downstream purchase prices slowed down, but the overall market transaction atmosphere was weak, and the price of raw material orchid carbon fell again. Lack of market support, calcium carbide prices fell generally again in the middle of the week, although demand increased slightly in some parts of the lower reaches of the week, enterprise shipments were more active, and some enterprise inventories were low. However, the overall downstream arrival is relatively sufficient, raw material inventory is high, the contradiction between supply and demand in the market still exists, so the market has not successfully bottomed out, and prices continue to fall mainly.

2. Crude oil

As of June 14, the price of WTI was $68.27 per barrel, down $3.02 from the same period last week; Brent was $73.20 per barrel, down $2.76 from the same period last week; Oman (period) was $74.54 per barrel, down $1.55 from the same period last week; Shanghai crude oil was 521.1 yuan per barrel, down 12.4 yuan per barrel compared with the same period last week.

Statistics on the operating rate of the PVC plant this week

This week (2023.06.09-2023.06.15) the capacity utilization rate of PVC production enterprises was 71.08%, which decreased by 1.95% compared with the previous week; of which, the calcium carbide method was 69.24%, decreased by 2.49%, and the ethylene method was 76.65%, and 0.74% lower.

V. International market price analysis

1. This week's international VCM market price

International VCM: June 8th: CFR far East, CFR Southeast Asia stable, FOB Northwest Europe down 10%, FAS Houston down 20%.

VCM/ area	2023/6/1	2023/6/8	Rise and fall	Unit
CFR far East	609-611	609-611	0	$/mt
CFR Southeast Asia	639-641	639-641	0	$/mt
FOB Northwest Europe	748-752	738-742	-10	$/mt
FAS Houston	450-460	430-440	-20	$/mt

2. International PVC market price this week

International PVC: June 14: CFR far East stable, CFR Southeast Asia, CFR India fell 10 minutes FD Northwest Europe (futures), FOB Northwest Europe fell 20 minutes Houston stable, Germany, the Netherlands, Italy, France, Spain and the United Kingdom fell 40.

Country	2023/6/7	2023/6/14	Rise and fall	Unit
CFR far East	749-751	749-751	0	Eur/mt
CFR Southeast Asia	764-766	754-756	-10	Eur/mt
FD Northwest Europe (Futures)	1468-1472	1448-1452	-20	Eur/mt
FOB Northwest Europe	798-802	778-782	-20	Eur/mt
FAS Houston	685-695	685-695	0	GBP/mt
CFR India	769-771	759-761	-10	Eur/mt
Germany	1374-1377	1334-1337	-40	$/mt
Netherlands	1374-1377	1334-1337	-40	cts/lb
Italy	1383-1387	1343-1347	-40	$/mt
France	1367-1382	1327-1342	-40	$/mt
The United Kingdom	1169-1171	1129-1131	-40	$/mt
Spain	1363-1367	1323-1327	-40	$/mt

3. List of unit prices this week

Product Name	Area	6.8	6.9	6.12	6.13	6.14
Propylene monomer	CFR China	742.00	738.00	732.00	732.00	732.00
Propylene monomer	FOB Korea	732.00	732.00	707.00	707.00	703.00
Ethylene monomer	CFR Northeast Asia	758.00	748.00	727.00	727.00	727.00
Ethylene monomer	CFR Southeast Asia	808.00	778.00	747.00	747.00	747.00
Styrene	Asia	920.00	930.00	903.00	887.00	902.00
Butadiene	CFR Taiwan	775.00	775.00	775.00	775.00	775.00

4. Ethylene price list this week

The country	Price type	6.8	6.9	6.12	6.13	6.14
Northeast Asia	CIF (USD / t)	760	750	730	725	725
Southeast Asia	CIF (USD / t)	810	780	750	745	745
China	CFR (USD / t)	750	740	740	730	730
Taiwan of China	CIF (USD / t)	820	750	750	750	750
Japan	FOB (USD / t)	810	780	750	745	745
Northwest Europe	CIF (USD / t)	750	747	745	745	746
Northwest Europe	FD futures price (EUR / ton)	730	729	727	724	722
America	FD (cents / lb)	16	16	15.8	15.8	15.9
South Korea	FOB (USD / t)	820	750	750	750	750