SunSirs: Supply and Demand Mismatch, China PC Market Falls again in August

https://www.chemnet.com   Sep 03,2024 SunSirs

According to the bulk ranking data of SunSirs, the domestic PC market fluctuated and fell at a low level in August, and the spot prices of various brands were narrowly lowered. As of August 31st, the mixed benchmark price of Business Society PC is around 16,216.67 RMB/ton, with a price increase or decrease of -1.52% compared to August 1st.

On the supply side: Since August, the overall operating rate of PC in China has remained relatively stable, with the industry average operating rate rising by about 2% to 75% compared to the end of July. Mid month spot supply is sufficient, and prices are still at the low point of the year. The manufacturer raised prices to build a bottom, but the results were minimal and it was difficult to make further operations. The scale of the future maintenance plan is average, and Wanhua Chemical, which had previously shut down the entire line, gradually restarted on the 23rd, with expectations of a slight increase in industry load. Overall, the flow of goods on-site is slow, and the market supply side has poor support for PC prices.

In terms of raw materials, it can be seen from the above chart that the domestic price of bisphenol A was relatively weak in August. At the beginning of the month, the international crude oil price increase was suppressed by weak demand prospects, which also affected the direct raw materials of bisphenol A, phenol and acetone, both of which weakened. In addition, the downstream production of the two main players weakened during the month, resulting in weak inventory and weak demand procurement. The maintenance and resumption of work in the bisphenol A industry in the future are intertwined, and the supply of goods is trending towards a flat trend. Overall, the support of bisphenol A for PC costs has declined..

In terms of demand, the PC consumption pattern has not shown any improvement in the medium to long term, and the overall trend has been relatively weak compared to the previous period. The main logic of procurement is biased towards weak rigid demand, with factories taking goods to maintain production. Downstream enterprises have low loads, weak stocking enthusiasm, and low consumption levels. Buyers have strong resistance to high priced goods and have a negative response to the rally from aggregation factories. The circulation of goods on site is slow. The demand side has poor support for spot prices.

The PC market fell at a low level in August. The weak trend of upstream bisphenol A market continues, and the support for PC cost side weakens. The load of domestic polymerization plants has remained stable with little increase, and there has been no improvement in supply side factors. In the early stage, PC prices fell to the low range of the year, but the market did not rebound due to bottoming out forces. On the contrary, downstream weak rigid demand consumption is difficult to drive the market. The poor flow of market supply and demand makes it difficult to correct the supply-demand imbalance in the short term. Business Society predicts that the profound supply-demand contradiction may affect the traditional peak season market, making it difficult for the PC market to rise in the future.

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