1. Price Trend

This week (12.16-12.20) polyethylene showed a slight downward trend.

According to Tudu Dudu, the average price of LDPE 2426H in East China is about 812.5 yuan.

The average price of HDPE 5000S is about 7,950 yuan per ton.

The average price of LLDPE 7042 is RMB 783.33 per ton.

As of December 20, LLDPE and LDPE prices in East China were stable and then fell, and HDPE prices showed a sideways trend this week.

The overall trend of the PE market this week was negative, most of the prices fell 50-150 yuan / ton.

Commodity markets rebounded slightly at the beginning of the week, providing some support, and the spot market was basically stable.

Early in the week, the stock market rebounded slightly, providing some support to the market. From Tuesday, futures prices began to fluctuate lower, dampening market sentiment and causing sellers to adjust prices, which were mainly lower.

The weakness was exacerbated by falling prices of petrochemicals in several sectors.

Commodity Index

On December 23, the LLDPE Commodity Index was at 70.39 points, down 0.32 points from yesterday. Compared with the cycle high of 117.56 points on December 11, 2013, it is down 40.12%, and up 0.69% from the cycle low of 69.91 points on September 8, 2019, it is up 0.69%. (Note: Cycle refers to the period from September 1, 2011).

On December 23, the LDPE Commodity Index was 62.74, down 0.39 points from yesterday. This is the lowest level in the history of the cycle. Compared to its high of 113.33 on December 8, 2013, it is down 44.64% (note: the cycle refers to the period after September 1, 2011).

The HDPE Commodity Index stood at 64.17 on December 23, down 0.27 points from yesterday. This is an all-time low for the cycle. Compared to its high of 102.33 points on July 24, 2014, it is down 37.29% (note: cycle refers to September 1, 2011 to present).

2. Market Analysis

Upstream: Oil prices rose steadily this week.

On Monday (Dec. 16), January 2020 WTI crude oil futures settled at $60.21/bbl, up $0.14/bbl from the previous session, trading in a range of $59.77 to $60.34/bbl.

As of Monday (December 16), February 2020 Brent crude oil futures settled at $65.34/bbl, up $0.12/bbl from the previous session, trading in a range of $64.88 to $65.66/bbl.

On Friday (December 20, 2020), WTI crude oil futures settled at $60.44/bbl, down $0.78/bbl from the previous session, trading in a range of $60.02-$61.20/bbl.

On Friday (December 20), February 2020 Brent crude oil futures settled at $66.14/bbl, down $0.40/bbl from the previous session, trading in the range of $65.70/bbl-$66.72/bbl.

Import and export situation: In October 2019, PE imports were about 136,500 tons. Among them, LLDPE imported 425,200 tons, HDPE imported 643,000 tons and LDPE imported 268,300 tons.

In October 2019, the total volume of PE export was 28,200 tons. Among them, 8,500 tons of PE were exported, 16,300 tons of HDPE were exported, and 33,400 tons of LLDPE were exported.

Manufacturers dynamic: This week, PE warehouse film downstream demand weakened, film demand increased, manufacturers film offer basically stable. However, many areas are still restricted by environmental protection policies.

According to Futures Trend: Todudu data show that on December 20, polyethylene futures L2005 opened at 7260, the highest price of 7370, the lowest price of 7255, the closing price of 7330, the early settlement price of 7245, the settlement price of 7245 . After the completion of the transaction, up 7305, up 85, up 1.17%. 584578, positions 725956, the daily increase in positions 33450. (Estimated unit: yuan / ton)

3. Market forecast

Todudu analysts believe that strong rise in international oil prices and rally in linear futures will support the market.

However, petrochemical inventories are building up and downstream companies are resisting high supply prices. Trading remains difficult. The market is expected to fall in the short term.

If you have any questions, please feel free to contact toodududu (tdd-global@toodudu.com).