South China Index slightly loose
Classification refers to both up and down
Last week, the domestic chemical product market was different, and the overall declined compared to last week. Among the 20 products monitored by Canton Trading, six rose, six fell and seven remained flat.
From the perspective of the international market, this week, the international crude oil market has risen slightly. During the week, Russia will reduce production from March to respond to Western sanctions, and OPEC+indicates that it will not increase the production of favorable factors such as the increase in output and OPEC in the latest report. The international crude oil market has risen overall. As of February 17, the settlement price of the main contract of WTI crude oil futures in the United States was US $ 76.34/barrel, a decrease of $ 1.72/barrel from the previous week. The settlement price of the main contract of Brent crude oil futures was $ 83/barrel, a decrease of $ 1.5/barrel from the previous week.
From the perspective of the domestic market, although the international crude oil market has a strong performance this week, the market has a limited rise in crude oil expectations and insufficient support for the chemical market. Therefore, the overall market market of domestic chemical products has declined slightly. In addition, the growth of downstream demand for chemical products is insufficient, and the recovery of some downstream demand is not as good as expected, thus dragging down the overall market trend to follow the pace of the international crude oil market. According to Guanghua Trading Monitor data, the South China Chemical Products Price Index rose slightly this week, as of Friday, the South China Chemical Products Price Index (hereinafter referred to as “South China Chemical Index”) stood at 1,120.36 points, down 0.09% from the beginning of the week and 0.47% from February 10 (Friday). Among the 20 sub-indices, 6 indices of mixed aromatics, methanol, toluene, propylene, styrene and ethylene glycol increased. Six indexes of Sodium hydroxide, PP, PE, xylene, BOPP and TDI fell, while the rest remained stable.
Figure 1: The South China Chemical Index reference data (Base: 1000) last week, the reference price is the trader offer.
Figure 2: January 2021 -January 2023 South China Index Trends (Base: 1000)
Part of the classification index market trend
1. Methanol
Last week, the overall methanol market ran weak. Affected by the decline of the coal market, the cost end support was weakened. In addition, the traditional downstream demand for methanol recovered slowly, and the largest downstream olefin unit started to operate at a low level. Therefore, the overall market continued to run weak.
As of the afternoon of February 17, the methanol market price index in South China closed at 1159.93 points, up 1.15% from the beginning of the week and down 0.94% from last Friday.
2. Sodium hydroxide
Last week, the domestic sodium hydroxide market continued weak operation. Last week, the overall market volume is light, the market is more cautious attitude. At present, the recovery of downstream demand is less than expected, the market is still mainly maintained just need to purchase. Moreover, the chlor-alkali market inventory pressure is high, the market bearish atmosphere is strong, in addition, the export market is weak and turned to domestic sales, market supply increases, therefore, these are negative in the Sodium hydroxide market downward.
Last week, the domestic Sodium hydroxide market continued to slide in the channel. Because most of the enterprises still maintain normal operation, but the downstream demand basically maintained just demand, and the export order is insufficient, the market pessimism is aggravated, resulting in last week’s domestic Sodium hydroxide market decline.
As of Feb. 17, the Sodium hydroxide price index in South China closed at 1,478.12 points, down 2.92% from the start of the week and 5.2% from Friday.
3. Ethylene glycol
Last week, the domestic ethylene glycol market had stopped rebounding. The international crude oil market has risen overall, and the cost support is enhanced. After the decline of the ethylene glycol market in the first two weeks, the market has begun to stop falling. In particular, some ethylene glycol devices are transferred to other better products, the market mentality has improved, and the overall market conditions have begun to rise. However, the downstream operating rate is lower than in previous years, and the ethylene glycol market has increased.
As of February 17, the price index in South China had closed at 685.71 points, an increase of 1.2% from the beginning of the week, and 0.6% from last Friday.
4. Styrene
Last week, the domestic styrene market was low and then rebounded weakly. During the week, the international crude oil market has risen, the cost end is supported, and the styrene market rebounds on weekends. In particular, the port shipments improved, and the expected expected reduction of port delivery was expected. In addition, some manufacturers’ maintenance and other favorable boosted. However, the pressure of port inventory is still large, the recovery of downstream demand is not as good as expected, and the shortage of the spot market is suppressed.
As of February 17, the price index of the styrene in the South China region closed at 968.17 points, an increase of 1.2%from the beginning of the week, which was stable from last Friday.
Future market analysis
The unstable geographical situation is still conducive to rising international crude oil. Suppress the trend of the international oil price market this week. From a domestic perspective, the overall market supply is sufficient and the downstream demand for chemical products is weak. It is expected that the domestic chemical market market or organizational operation this week is mainly based on.
1. Methanol
There are no new maintenance manufacturers this week, and with the recovery of some preliminary maintenance devices, the market supply is expected to be sufficient. In terms of demand, the main olefin device operates low, and traditional downstream user needs may increase slightly, but the growth rate of overall market demand is still slow. In summary, in the case of limited cost and relatively limited basic surface improvement, the methanol market is expected to maintain a shock trend.
2. Sodium hydroxide
In terms of caustic soda liquid, the overall market supply is sufficient, but the downstream demand is still weak. At present, the inventory pressure of the main production area is still large. At the same time, the downstream purchase price has continued to decline. It is expected that the caustic soda liquid market is still declining.
In terms of caustic soda flakes, due to weak downstream demand, the market is frequent at low prices. In particular, tthe main downstream alumina demand is difficult to improve and the non-aluminum downstream market support is insufficient,it is expected that the caustic soda flakes market still has room to decline.
3. Ethylene glycol
It is expected that the ethylene glycol market market is dominated. Because the 800,000 -ton device of Hainan Refinery has a product release, the market supply is large, and the downstream polyester operating rate still has room for improvement. However, the pace of growth in the later period is still unclear, the glycol market conditions will maintain slightly shocks.
4. Styrene
The styrene market in next week’s rebound space limited. Although the repair and downstream demand recovery of the styrene factory will boost the market, the international crude oil market trend is expected to be weak next week, and the market mentality may be affected, thereby restricting the market price increase.
Post time: Mar-01-2023