In late July, the domestic ABS market remained stable with small fluctuations, and some spot prices of certain grades were lowered. According to the Commodity Market Analysis System of SunSirs, as of July 26th, the average price of ABS sample products was 12,000 RMB/ton, an increase or decrease of 1.48% compared to the price level on July 1st.
Supply level: In early July, the domestic ABS industry's load was roughly 70% of the operating level at the end of last month. In the middle of the month, companies such as North Huajin and LG Yongxing underwent varying degrees of maintenance and load reduction, resulting in an overall decrease in operating rates. As of last weekend, the industry's operating rate remained stable at around 65%. Manufacturers tend to have confidence in their operations and focus on firm product pricing. The overall inventory of the industry has slightly increased, and the benefits of previous supply contraction have basically been exhausted. Overall, the supply side provides moderate support for ABS spot prices.
Cost factor: In late July, the trend of ABS upstream three materials was weak, providing average support for ABS cost side. Among them, the price of acrylonitrile has stabilized at a low level, and production capacity has expanded significantly in the second half of the year, with an increasing supply environment covering the market. The expected trend of acrylonitrile prices is bearish and the profitability of enterprises is not optimistic. However, due to the ongoing cost pressure, major manufacturers have stated that they have already incurred losses and have a clear intention to raise prices, thus delaying the market downturn. Downstream demand continues to be weak, with many businesses maintaining their previous offers as the main focus, and the weak trend has not improved.
Recently, the domestic butadiene market has been stable with a slight weakness, and the market is struggling with long and short positions. Affected by the unplanned maintenance news of the Sirbang plant, the company attempted to raise prices, but the demand for maintaining basic needs was weak, and the enthusiasm for entering the market was weak, resulting in obvious resistance to price increases. The market lacks actual transaction support, and the offer is dragged down and falls. It is expected that the butadiene market will maintain a weak and stable trend in the short term, and there may still be a slight downward trend.
Recently, the styrene market has been weak and the price continues to decline. International oil prices have fluctuated and the pure benzene market has dropped significantly, with poor cost support. In the early stage, the price of styrene rose to a relatively high level, and buyers' resistance to high-end sources increased, resulting in a decrease in market trading volume. Affected by light trading on the spot side, the bearish mentality of industry players has increased, and the reduction of positions in multiple orders has driven the price of styrene to continue to decline. However, the local inventory position will drop to a low level, and it is expected that the future market situation of styrene may stop falling and consolidate.
In terms of demand: As we enter late July, there has been no improvement in the main terminal demand for ABS. Some home appliance manufacturers are maintaining holiday shutdowns, and the overall load position of downstream factories is low, with weak stocking operations and a focus on basic needs. In the early stage, traders shipped at high prices, and last week the overall market momentum cooled down, resulting in a slower flow of goods. Overall, the demand side is not providing strong support to the market.
In late July, domestic ABS prices showed weak consolidation. The overall stalemate of the upstream three materials is weak, and the cost support for ABS is average. In the early stage, the favorable news of the downward adjustment of ABS polymerization plant construction has been exhausted, and there has been a slight increase in social inventory, but there is still supply pressure on site. The demand side has weak demand, and the market situation is obvious during the off-season, resulting in low trading momentum. Overall, it is expected that the ABS market will remain weak and difficult to change in the short term.
If you have any questions, please feel free to contact SunSirs with support@sunsirs.com.