Analysis of the trend of domestic polyethylene market

As reported, during the week from November 26 to November 30, 2012, the domestic polyethylene (PE) market remained stable with most regional prices fluctuating within a narrow range. Firstly, regarding the production activities of major manufacturers, Shanghai Petrochemical’s first PE plant is scheduled for maintenance from November 9 to December 3, lasting approximately 25 days. Additionally, Lanzhou Petrochemical's full-density plant will shut down on November 19. On the same day, Shanghai Secco’s linear plant will also cease operations, planning to restart on December 4. Fujian Joint Venture’s linear plant will be parked starting November 19, while Maoming Petrochemical’s first plant ceased operations in the early hours of November 29. In terms of pricing trends, this week, petrochemical prices remained largely unchanged, with some high-pressure and specific linear product ex-factory prices experiencing minor declines. The mainstream ex-factory price for LLDPE 7042 hovered between 10,500 to 10,600 yuan per ton. Secondly, examining the market trends, the PE market has remained steady this week, with most regions concluding within limited price ranges. While overall petrochemical prices did not change significantly, high-pressure and linear product prices in East China were higher compared to other regions. Consequently, several factories reduced their high-pressure and linear product prices. However, due to regional shortages of high-pressure and linear products, and higher costs for merchants sourcing supplies, the market saw a slight downward trend. Import linear products in North China were particularly tight, with domestic linear prices around 10,700 yuan per ton, whereas imported linear products like 0218D were priced at 11,000 yuan per ton. Despite import costs being around 10,850 yuan per ton, the inverted market conditions have led to a decrease in import business. In the low-pressure segment, supply of low-pressure film materials across the entire PE market remains constrained, keeping prices firm. However, low-pressure injection molding plastics showed slight weakness, while other low-pressure products remained relatively stable. This week marks the final trading week of the month, and petrochemical companies are expected to announce new pricing policies soon. As a result, the market atmosphere is relatively active, with buyers and sellers awaiting guidance from petrochemical news. Most transactions are occurring in small volumes. Looking ahead, although petrochemicals have yet to release their new pricing policies, the willingness to adjust prices persists. Analysts anticipate a potential cooling off in inflation. Despite regional petrochemical inventories showing varying degrees of decline compared to the previous month, they remain at elevated levels. Coupled with weak downstream demand, business and social analyst Xue Jinlei expects the market to continue consolidating next week without significant changes.