1. Price Trend

In November, the domestic PE market declined in all three major types. In this month, the LLDPE market in East China fell first and then rose, with narrow fluctuations. HDPE and LDPE markets continued to decline this month. Rabbit data showed that LLDPE 7042 fell to around RMB 7,416.67 per ton at the end of the month, and LDPE 2426H fell to around RMB 8,125 per ton at the end of the Moon. Prices fell 200-300 yuan/ton.

2 Market Analysis

In November, the first-line demand season has passed. Demand is weak. The supply pressure in the plastics market has not eased. Therefore, the contradiction between supply and demand still exists. At the beginning of the month, the overall market was dominated by declines. Except for a few commodities with low inventories and abundant resources, the center of gravity of most commodities declined. Linear futures rebounded slightly to support market sentiment, but traders remained cautious and wait-and-see, and overall gains were limited. Later in the day, linear futures continued to oscillate, with some petrochemical varieties cutting prices. And the market support for the cost of supply is weak. Enterprises worried about the price drop, have adjusted prices, resulting in all prices in the market have different degrees of decline. Downstream factories' replenishment incentive was relatively low. By the end of the month, the linear futures market continued to rise slightly, with traders in a good frame of mind and higher enthusiasm for listing. Downstream market inquiries increased and market sentiment improved. In addition, as the end of the month approaches, most of the ex-factory prices of petrochemical products are stable, and the market cost support is acceptable. LLDPE market rebounded slightly, HDPE, LDPE market stabilized.

Throughout the downstream enterprises, with the decline in PE downstream agricultural film start rate, the number of orders in November also decreased. Buying on demand is the main factor. The order quantity is not as high as in previous years. Adjust the offer according to the supply and demand of resources to maintain the downstream demand for immediate purchase. The start rate of large and medium-sized greenhouse film enterprises has dropped to 30-60%, while the start rate of small and medium-sized enterprises is around 10-40%. Due to the lower demand for plastic films, the production of individual plastic film manufacturers is also lower.

Import and export: In October 2019, PE imports were about 136,500 tons. Among them, 425,200 tons of LLDPE were imported, 643,000 tons of HDPE were imported, and 268,300 tons of LDPE were imported. In October 2019, PE exports totaled 28,200 tons. Among them, PE exports were 8,500 tons, HDPE exports were 16,300 tons, and LLDPE exports were 33,400 tons.

3 Market Forecast

Todudu analysts PE analysts believe that the current ex-factory prices of petrochemical products are basically stable, the market cost support is still sufficient. However, in the early stages of the market, some maintenance equipment running frequently, the market supply pressure increased. Downstream agricultural film demand peak has passed. The contradiction between supply and demand still exists. The enthusiasm to enter the downstream market has weakened. Most factories are on the sidelines unless they need to lift goods. PE is expected to continue to be weak.

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