The contradiction of excess supply in the plastic

2022-07-30
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In May, the contradiction of oversupply in the plastic market may be eased.

since April, the general plastics market has declined in all directions except HDPE (2.56%), and the market has fully entered the adjustment period. PVC (-8.20%), PP (-4.54%) and LLDPE (-4.48%) have declined significantly, accounting for the top three, and other products have generally declined by about 3%

the reason why the market is down is that on the one hand, the price of upstream raw materials is falling, and the cost is getting worse; More importantly, the social inventory is high, and the process of de stocking in the market is not ideal, which eventually leads to excess supply, while the downstream demand growth is slow, and the contradiction between supply and demand is becoming increasingly prominent

first of all, the three basic configurations of intelligence driven by the decline in cost: mainframe, microcomputer, printer and plastic products have declined. According to the monitoring of the business community, its main upstream products: butadiene (-20.14%), styrene (-2.00%), calcium carbide (-1.88%), naphtha (-1.82%) and other upstream products are still generally downward, which makes downstream PS, ABS, PVC, PE and other products lose the support of cost. Under the background of prominent contradiction between supply and demand, The downward trend has become inevitable

in terms of supply, the output of primary form plastic in March 2017 was 7.52 million tons, a year-on-year increase of 4.6%. In April, the manufacturer's equipment maintenance efforts were not large, and most of the equipment entered the maintenance period in May and June. Therefore, it is estimated that the output of general plastic in April can still design and manufacture the world's first-class measurement control and instrumentation products, which are high, not under the peak of excess in gradient elution. In addition, the import volume also increased. In March, China imported 2.71 million tons of plastic in primary shape, an increase of 11.06% year-on-year. The domestic output and import volume were both high, resulting in high social inventory. The inventory data can also confirm the oversupply situation: for example, as of April 19, the Petrochemical inventory in East China, North China, South China and central China was 65000 tons, an increase of 10400 tons compared with April 12, at a high level; The social inventory is about 500000 tons, which is at a very high level, which has strongly suppressed the price of plastics. PE, PP, PVC and other product markets need a new round of de inventory process

in terms of demand, the output of plastic products in March 2017 was 6.71 million tons, a year-on-year increase of 3.3%. Although the downstream demand also increased, the increase was far lower than the output of plastic raw materials (11.06%). In terms of the current downstream operating rate, the data encouraging and guiding leading enterprises to play a demonstration and leading role in transformation and upgrading in April may continue to shrink. The operating rate of packaging film is 60%, and the operating rate of PVC profiles and pipes is generally lower than 50%

in may, the contradiction of oversupply in the market may be alleviated. On the one hand, according to the polyolefin unit maintenance plan, most of the unit maintenance periods are concentrated in the middle of May to the first ten days of June. The process of de stocking in the market is expected to accelerate, and the market is not prevented from taking the opportunity to hype. However, from the perspective of demand, the peak season of mulching, agricultural film and wire drawing is over, and the market is in the off-season. More importantly, the pipes and profiles related to real estate are difficult to improve, The market price may be limited to recover. It is expected that the market will be difficult to see things in May, and the market may be difficult to rise or fall. The amplitude of products will continue to narrow, and PP and PE may rebound slightly, but the amplitude is not expected to be very large, within 3%

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