In November, the domestic ABS market remained stagnant and consolidated, with narrow fluctuations in spot prices for various grades. According to the Commodity Market Analysis System of SunSirs, as of November 30th, the average price of ABS sample products was 11,487.5 RMB/ton, which was basically the same as the beginning of the month.
In terms of supply: After the domestic ABS industry's operating rate increased in November, it slightly fell back, and the industry's load level has increased compared to the end of October. In the first half of the month, Tianjin Dagu, Jilin Petrochemical, and Zhejiang Petrochemical all resumed work or experienced an increase in load. In the latter half of the month, maintenance was gradually released, and the industry's operating rate decreased to around 71%, still up 4% from the end of October. Although the domestic weekly average production remained above 120,000 tons at the end of the month, the overall pattern of abundant supply remains unchanged, but there has been some digestion in terms of inventory. The position has dropped by more than 10,000 tons to around 178,000 tons. Overall, the negative impact of the supply side on ABS spot prices has narrowed in November.
In terms of cost: In November, the upstream three materials of ABS showed varying trends, with overall support for ABS costs being average. Among them, the acrylonitrile market saw a significant increase in the early stage. The favorable news of the shutdown and maintenance of acrylonitrile factories in East China, such as Anqing Petrochemical, Shanghai SECCO, and Jiangsu Sierbang, has been released, and market prices have surged due to tight supply. However, the downward transmission of prices is difficult, and the expected recovery of supply in the north may limit the room for further price increases.
The butadiene market has significantly declined within the range, with a monthly decline of 21.5%. The downstream synthetic rubber futures market has been weak throughout the month, with a lack of support on the demand side. In addition, new facilities have been put into operation in Tianjin, and the inventory of ports in East China is also high, with negative factors flooding the market. As prices fell, some purchases were stimulated to enter and form a bottoming out, and the decline slightly slowed down by the end of the month. Overall, the market atmosphere is still relatively weak due to the impact of loose supply, and it is expected that the market will continue to operate weakly in the short term.
Since November, the styrene market has fluctuated slightly. The remote upstream crude oil has slightly fluctuated, while the direct raw material prices have remained firm, and the cost support for styrene is still acceptable. The operating rate of domestic industries remains low, and the tight supply situation continues. In addition, the inventory positions of various ports have been digested, and the expected decrease in imported goods to ports at the end of the month. At present, the bullish trend dominates the market, and styrene may still strengthen in the short term.
In terms of demand: The main terminal demand in November generally continued to be weak, and the market sentiment remained strong this month. In the second half of the month, due to the shopping festival and subsidy policies stimulating the sales of some end products, demand slightly increased. Due to the concerns of home appliance exporters about the remote market, some export demand has been pushed forward, the overall load position of factories has rebounded, terminal stocking willingness has strengthened, and procurement operations have increased synchronously. Merchants take advantage of the situation to digest inventory, try to raise prices through quotations, and increase the activity of source circulation. Overall, the demand side has slightly improved its market support.
The domestic ABS market in November mainly experienced consolidation. Upstream three materials showed mixed ups and downs, providing average comprehensive support for ABS cost side. The load of ABS polymerization plant has stopped rising and rebounded, and the inventory of finished products has been partially digested but still remains at a high level. At the end of the month, the demand on the demand side has strengthened, and the market has remained stable and strong under the guidance of consumption. However, the supply contraction within the market is limited, and coupled with the risk of overdrawn future consumption due to export demand, ABS analysts from SunSirs believe that price changes may not be significant in the short term, and it is expected that the ABS market will explore a narrow range to find a market equilibrium point in the future.
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