Review of HDPE market in the first half of 2002

Review of HDPE market in the first half of 2002

in early January, the market demand was weak. In fact, since the fourth quarter of last year, there has been no "active" trading atmosphere in the high-density polyethylene market across the country. Since January 2002, the trading atmosphere has been more flat, and the enthusiasm of end users, dealers and others to enter the market has been significantly weakened, which is reflected in the reduction of large-scale transactions. According to some dealers in the Pearl River Delta region of Guangdong Province, few decent transactions have been made since January, and the transaction situation of Yuyao plastic city is not optimistic, so it is difficult to sell large-scale goods

in addition, there was a strong wait-and-see atmosphere in early January. After the country lowered the import tariff of HDPE, the market resources have not been fully in place, and the international market quotation has not rebounded significantly as expected. Therefore, many operators believe that the price of HDPE will fall in the future, and the market psychology is not conducive to the development of the market

in late January, the domestic HDPE market was strongly promoted by the active speculation and buying of middlemen, and the market price rose rapidly. The sales of various production enterprises were very smooth, and the inventory was very small. The price of domestic HDPE (wire drawing material) in the northern market rose to about yuan (ton price, the same below), and the price in Jiangsu and Zhejiang markets was about yuan, up about yuan from the end of December last year

the rise in the price of HDPE in January does not fully represent the authenticity of market demand. Some operators believe that it has a certain "trial point system will replace the national subsidy policy to achieve financial support for the new energy vehicle industry", which is a trial to see whether the market can rise after the Spring Festival. However, this price rise did not cause sufficient response in the market. Users and small and medium-sized dealers were not active, and there were still not many who bought a large number of goods and established inventory. Some experts believe that this trend at least shows that the rise of HDPE market is still not practical. Whether the price increase of petrochemical enterprises can be reflected quickly still needs a period of time to observe. At least, it will be meaningless to blindly increase the number of a/d in spring. In the short time after the holiday, we will face increasing market pressure

in February, the domestic HDPE market trend was basically stable. The market price of wire drawing material in Shandong was about yuan, and that in Jiangsu and Zhejiang was about yuan, up 50 yuan from the price at the end of January. This calm is directly related to the long Spring Festival holiday in February

in March, after a period of calm in the domestic HDPE market, the market price soared rapidly from the middle of March, and the manufacturer continued to raise the ex factory price, almost forming a situation of one price per day. Due to smooth sales, the inventory was always low. The market trading of high-density polyethylene showed a trend of tight spot prices, and the market atmosphere was better than the fiery scene in late January. The HDPE market has not stopped rising, especially for wire drawing materials. The price of Shandong market has risen to about yuan, while that of Jiangsu and Zhejiang markets has also risen to about yuan, both up nearly yuan from the end of February. Although the spring ploughing season in March every year is the peak demand season for HDPE, such a sharp rise in the market has never been seen in the history of the same period in previous years. The reasons are mainly driven by the following factors:

(1) the stimulation of domestic petrochemical enterprises to raise factory prices. As the major petrochemical enterprises in the north have raised the ex factory price of HDPE to varying degrees, especially in Guangdong, which mainly depends on the supply from other provinces, the market price naturally "rises"

(2) the stimulation of the rising quotation in the international market. As the oil price in the international market has been in a relatively stable rising state in March, as shown in Table 1 for the specific heat treatment scheme, which directly stimulated the rise in the quotation of high-density polyethylene in the international market, the price reported by foreign investors to Guangdong and other southern regions has risen to a high level of US dollars

(3) middlemen add fuel to the flames. In February, domestic dealers expected to be optimistic about the future market, so they ate a lot, which made the market price rise atmosphere higher. While the price rise in the northern market was obviously earlier than that in the southern market, which was an important factor to stimulate the price rise in Southern markets such as Guangdong

in April, the domestic HDPE market was finally unable to continue to rise, but there was a sharp diving trend under the action of large-scale dumping by middlemen. Various varieties of HDPE began to decline all the way from the beginning of the month, and some varieties have fallen by more than yuan in just two weeks, and the market transactions are very chaotic. At the same time, some imported HDPE goods (mainly Indian goods) ordered in the early stage poured into the market, and the price was always more than yuan lower than the mainstream market price, which also greatly disrupted the stability of the HDPE market. Although Sinopec and PetroChina hoped to stabilize the market with price protection measures in mid April, due to the excessive increase in the early market of high-density polyethylene, the psychology of users to ship at a low price has already formed, and this measure finally ended in failure. The reduction of the factory price of enterprises led to an increase in the decline of the high-density polyethylene market

in April, the price of domestic HDPE (wire drawing material) in Shandong market has fallen to about yuan, while that in Jiangsu and Zhejiang markets is also about yuan, both of which have fallen by more than yuan from the end of March

in the first ten days of May, the market demand for HDPE gradually rebounded, and the market entry atmosphere of the industry was good. The supply and demand were developing in a direction conducive to the rise of prices. However, more imported products have caused certain pressure on the domestic market. The southern coastal areas in the domestic market are mainly imported products, and the price of imported plastic injection products is basically about yuan, but the price of domestic 5000S is as high as 6600 yuan. In addition, the price of 5000S in Shenyang, Harbin, Dalian and other markets in northern China is about 6450 yuan, and the price of domestic wire drawing materials in eastern China is also maintained at about 6450 yuan

on the whole, the resources of domestic wire drawing materials are relatively small, especially in Guangdong region. There are not many domestic wire drawing materials arrived in the first half of the month on the market, and many dealers do not have stock, mainly engaged in imported products. The reason is that when the market situation is poor in the early stage of testing, the operators dare not organize too many new products. Due to insufficient resources, the price of domestic wire drawing materials is relatively high. However, domestic resources in northern China are abundant. This difference in resources between the north and the South will not cause too much upward pull in prices

of course, in East China and South China, due to the large amount of imported plastic injection resources, most dealers, especially small and medium-sized businesses, often operate imported plastic injection products, which are highly competitive, and the price is also hovering at a low level

in the second half of May, the overall price of HDPE was still rising slightly. The price of 5000S produced in Daqing has risen to about 6850 yuan, while the price of imported plastic injection varies from yuan. Ton prices have increased by yuan over the first half of the month

in mid and early June, the price of domestic HDPE fell all the way. Under the attack of vicious price competition from Sinopec and PetroChina, the whole market was in a very chaotic situation. An important reason is that major domestic production enterprises have reduced the factory price one after another, and the adjustment range is quite large, and some ton prices have decreased by 250 yuan. This undoubtedly directly contributed to the decline of market prices. Another reason for the decline in the price of high-density polyethylene is the large arrival of imported products and low cost, which has a great impact on the domestic market. It is understood that most of the products delivered are Indian and Southeast Asian products. The market price of these products is low, which directly impacts the price of domestic resources and drives the whole market price down. Of course, the weakening market demand is the most critical reason for the downturn of HDPE market. As June is the off-season of demand in the HDPE market, the enthusiasm of users to enter the market has significantly weakened, and even some large households have begun to reduce the purchase volume. Dealers dare not purchase more, and the market transaction lacks due "passion". The phenomenon of traders selling goods is relatively serious, and the oversupply has led to the market price falling to the lowest point in half a year (the lowest price of wire drawing material is about yuan, and that of plastic injection is about yuan)

since late June, the HDPE market seems to have stabilized at the bottom. Some middlemen also believe that the low price of HDPE has appeared and begin to actively enter the market to attract goods, resulting in the reduction of inventories of production enterprises and the recovery of market prices

at present, the mainstream value of domestic HDPE (wire drawing material) in Shandong market is about yuan; The price in Jiangsu and Zhejiang is yuan, which has increased slightly by more than yuan compared with the previous price

it should be said that although the HDPE market has rebounded recently, at present, it can only be regarded as the result of the market rebound at the bottom and the speculation of middlemen. Many middlemen are not optimistic about whether there will be a big market. Therefore, the overall trend of HDPE market in July is likely to be stable, and there is little possibility of a sharp rise. Of course, there are also some factors that will have a certain impact on the HDPE Market:

(1) some domestic HDPE production enterprises will carry out maintenance

in July, the overhaul of some domestic HDPE production enterprises will be more concentrated, such as Fushun, Yangzi, Lanhua and Dushanzi, which will carry out major overhaul one after another, and the time is not too short, which will undoubtedly give a boost to the stability of the domestic HDPE market. Among them, due to the large capacity of its high-density polyethylene unit (160000 tons), Yangzi Petrochemical will greatly reduce the market resources once it is overhauled

(2) the import quotation may rise

in late June, as the price of domestic HDPE fell to a low level, some middlemen began to attract goods, stimulating the market price to rise. "Affected by this, some domestic foreign trading houses and import traders have stopped quoting, and they all said that they are likely to raise prices, which will continue to stimulate the domestic market.

(3) Insufficient domestic downstream demand is still a hidden worry of the market

although the operating rate of some domestic downstream processing enterprises increased in July, generally speaking, the market demand will not be too large. Even if the market price rises, it mainly depends on artificial speculation. Therefore, many insiders believe that the recent speculation in the domestic HDPE market is obvious, and the market rise lacks strong support from demand. Once the hype is slightly stronger, the market decline is inevitable. Judging from the current market situation, it is estimated that it is difficult for HDPE to completely curb the market decline in the short term, because the market demand is still in the off-season in the next month and a half, and the quotation in the international market will also be in a downward state