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SunSirs: The Supply-demand Mismatch Pattern has not Changed, China PC Prices Fell again at a Low Level in November

December 04 2024 09:06:30SunSirs(Selena)

According to the bulk ranking data from SunSirs, the domestic PC market fluctuated and fell in November, with most spot prices of various brands decreasing. As of November 30th, the mixed benchmark price of Business Society PC is around 15,900 RMB/ton, with a price fluctuation of -0.62% compared to early November.

In terms of supply, the overall operating rate of PC in China has shown a downward trend in November, with enterprises such as Cangzhou Dahua and Jiaxing Teijin entering maintenance successively. The industry average operating rate has narrowly fallen from 81% at the beginning of the month to around 75%. The average weekly production of PC has also fallen from the ultra-high level of over 60,000 tons in the medium and long term to below 60,000 tons. But the on-site supply of goods is still abundant, and the supply-demand mismatch pattern remains unchanged. Good news on the supply side is difficult to achieve, with high inventory causing manufacturers to be unable to raise prices, and low ex factory pricing resulting in a stalemate. At the same time, there is an expectation of resumption of work in the future, and the market supply side has poor support for PC prices.

In terms of raw materials: From the above chart, it can be seen that in November, domestic bisphenol A continued the rapid downward trend in October, and the spot price at the beginning of the month was already at a low point. During the month, some companies underwent maintenance and the upstream phenol cargo was delayed in arrival at the port, bringing some positive news in terms of supply and cost. The supply and demand forces are balanced, and prices have stopped falling and stabilized. But the main downstream PC and epoxy resin stocks are average. In addition, the acetone market has stabilized, and overall, there is a standoff between long and short positions in bisphenol A, with the market operating in a stalemate. Bisphenol A has a low horizontal support for PC cost.

In terms of demand: The PC consumption pattern has not improved for a long time, and the overall trend continues to be weak in the previous period, with the logic of weak rigid demand procurement in the market. Industry players tend to have a wait-and-see attitude, while downstream factories purchase goods to maintain production. Buyers have strong resistance to high priced goods, and the circulation of goods on site is slow. The overall inventory in China is high, and merchants have increased their price reduction and order placement operations, making it difficult for the demand side to form strong support for PC spot prices.

The PC market in November was generally weak in consolidation. The upstream bisphenol A market remains flat, with limited support for PC cost changes. The load of domestic aggregation plants has continued to decrease slightly throughout the month, with more restarts than maintenance in the short term, leading to relaxed supply expectations. At the same time, the industry's inventory is high, and there has been no substantial improvement in supply pressure. The downstream weak rigid demand stocking pattern has not changed, making it difficult to drive market trends. The price of PC has fallen below the low point of the year, but the profound mismatch between supply and demand cannot be alleviated in the short term. Therefore, SunSirs predicts that the PC market may still show signs of fatigue in the future.

 

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