1. Price Trend

This week (12.16-12.20) polyethylene showed a weak decline.

The average price of LDPE 2426H as per toodudu, in East China was about 812.5 RMB/ton.

The average price of HDPE 5000S was about 7,950 RMB/ton.

The average price of LLDPE 7042 was 7,833.33 RMB per ton.

Up to December 20, the prices of LLDPE and LDPE in East China showed a steady trend and then fell, and HDPE prices showed a sideways trend this week.

The overall trend of the PE market was weak this week, with most of them falling by RMB 50-150 / ton.

The goods market rebounded slightly at the beginning of the week, which provided some support to the market, and the spot market mostly stabilized.

Futures began to fluctuate and fell on Tuesday, suppressing market sentiment, merchants adjusted their offers, and prices fell mainly.

In many regions, petrochemicals have lowered their ex-factory prices and coupled with weak terminal demand, the market has continued to fall.

Commodity Index

The LLDPE commodity index on December 23 was 70.39, a decrease of 0.32 points from yesterday. It is 40.12% lower than the highest point of the cycle at 117.56 points on December 11， 2013 and it is 0.69% higher than the lowest point of the cycle at 69.91 points on September 8, 2019 (Note: The cycle refers to since September 1, 2011).

On December 23, the LDPE commodity index was 62.74, a decrease of 0.39 points from yesterday. It is a record low in the cycle. And it is 44.64% lower than the highest point of 113.33 on December 8, 2013 (Note: The cycle refers to since September 1, 2011).  

On December 23, the HDPE commodity index was 64.17, a decrease of 0.27 points from yesterday. It is a record low in the cycle. It is 37.29% lower than the peak at 102.33 point on July 24, 2014 (Note: The cycle refers to September 1, 2011 to present).  

2. Market Analysis

Upstream: Oil prices rose steadily this week.

On Monday (December 16), WTI crude oil January 2020 futures settlement price is 60.21 US dollars per barrel, an increase of 0.14 US dollars per barrel from the previous trading day, trading range of 59.77-60.34 US dollars per barrel.

On Monday (December 16), Brent crude oil February 2020 futures settlement price was 65.34 US dollars per barrel, an increase of 0.12 US dollars per barrel over the previous trading day, and the trading range was 64.88-65.66 US dollars per barrel.

On Friday (December 20), the WTI crude oil February 2020 futures settlement price was US $ 60.44 per barrel, a decrease of US $ 0.78 / barrel from the previous trading day, and the trading range was US $ 60.02-61.20 / barrel

On Friday (December 20), Brent crude oil February 2020 The futures settlement price was 66.14 US dollars per barrel, a decrease of 0.40 US dollars per barrel from the previous trading day, and the trading range was 65.70-66.72 US dollars per barrel.

Import and export: In October 2019, PE imports were about 1.3365 million tons. Among them, LLDPE imports were 425,200 tons, HDPE imports were 643,000 tons, and LDPE imports were 268,300 tons

And the total PE export in October 2019 was 28,200 tons. Among them, PE exports amounted to 8,500 tons, HDPE exports amounted to 16,300 tons, and LLDPE exports amounted to 33,400 tons.

Manufacturer dynamics: This week, the demand for PE downstream shed film has weakened, the demand for mulch film has increased, and the quotation of manufacturers’ mulch film is basically stable. However, many regions are still constrained by environmental protection policies.

Futures trends: According to data from toodudu, on December 20th, polyethylene futures L2005 opened at 7260, the highest price was 7370, the lowest price was 7255, the closing price was 7330, the previous settlement price was 7245, the settlement price was 7305, an increase of 85, an increase of 1.17%, and the transaction was completed. The amount is 584,578, the position is 725,956, and the daily Masukura is 33,450. (Quotation unit: Yuan / ton)

3. Market Forecasting

toodudu’ analysts believe that international oil prices are rising strongly and linear futures are rebounding, which will support the market.

However, petrochemical inventory has accumulated, and the downstream has some resistance to high-priced sources. The transaction is still difficult. It is expected that the market may decline in the short term.

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