Aluminum prices slightly rebounded in December

According to the Commodity Market Analysis System of Business Society, the average price of aluminum ingots in the East China market on December 28, 2023 was 19580 yuan/ton, an increase of 4.86% compared to the aluminum price of 18673.33 yuan/ton at the beginning of the month (December 1).

In the long term, the current price is in a sideways range after a high level decline. Since May, it has been fluctuating below 19000 yuan/ton, and by the end of August, it has exceeded 19000 yuan/ton. In September, aluminum prices first fell and then rose. In October, the center of gravity of aluminum prices fell back to around 19000 yuan/ton and fluctuated. In November, aluminum prices were weak and began to recover after mid December, standing above 19000 yuan/ton.

Current Fundamental Situation

On the supply side, Yunnan’s electrolytic aluminum production has been reduced, with an estimated scale of 1.17 million tons.

On the demand side, orders for new energy vehicles and photovoltaics performed well, but some traditional demand started slightly lower than expected. The off-season effect of alloys, plates, strips, and foils was evident, benefiting from the acceleration of ultra-high voltage and a slight rebound in orders for building curtain walls, while the cable and profile sectors saw a slight increase.

3. Social inventory continues to decline significantly. As of December 25th, the mainstream social inventory of electrolytic aluminum ingots in China was 414000 tons, with 149000 tons of inventory removed compared to November 30th. Based on year-on-year data, it is at a low level in the same period of nearly five years.

4. In terms of cost, the shortage of ore still restricts the start of smelting. Aluminum oxide plants in Henan and Shanxi have no plans to resume production due to the shortage of raw materials. Guangxi is expected to resume production slightly, but the progress is slow. The heating season in the north may increase the possibility of alumina plants limiting production again. Heavy snow weather is spreading in the north, and some electrolytic aluminum plants in the northwest may have a need for early stocking. At the same time, recent road freight rates from Shandong, Henan to Xinjiang have increased compared to the previous period. According to the news, the explosion at the central oil depot in the capital of Guinea has caused a shortage of fuel supply, which has begun to affect ore production. It is reported that Shunda Mining in Guinea has suspended operations of Weili Mining and reduced its production capacity to half. Some bauxite producers have revealed that their existing inventory can only be maintained for about 10 days. At the same time, the tense situation in the Red Sea has increased shipping risks. The price of raw alumina is firm.

Fundamental variables that may affect prices in the near future

1. The risk of production reduction in Northwest electrolytic aluminum enterprises. Due to the impact of electricity supply, aluminum companies in regions such as Xinjiang and Qinghai may face the risk of reducing production.

2. There is an expectation of a downward shift in the operating rate of downstream processing enterprises in the Central Plains region. Recently, processing enterprises in Henan Province have experienced a decline in production due to environmental control measures.

Future market forecast

The strong price of alumina may continue, and cost support may strengthen. But currently, aluminum prices are also rising rapidly, digesting some of the positive news; Gradually entering the downstream consumption off-season, fortunately, the current social inventory of aluminum ingots remains low, providing some support for aluminum prices. It is expected that aluminum prices will fluctuate strongly in the later period.

Product name: isobutyraldehyde

Latest price (December 27th): 8166.67 yuan/ton

On December 27th, the domestic market price of isobutyraldehyde slightly increased, with a price increase of 100 yuan/ton compared to December 26th, an increase of 1.24%, and a year-on-year increase of 26.94%. The price of raw material propylene has slightly increased, with good cost support. The downstream market for new pentanediol has slightly increased, and downstream customers have increased their enthusiasm for purchasing isobutyraldehyde. Duo Chong Li is good, and some dealers have raised their prices.

In the future, it is expected that the domestic market price of isobutyraldehyde will fluctuate and rise, with consolidation being the main trend. The average market price is around 8200 yuan/ton.

According to the commodity market analysis system of Business Society, the price of boric acid remained stable in December. As of December 26th, the average price of boric acid in the domestic market was 7462.50 yuan/ton, unchanged from the beginning of the month, and decreased by 7.87% from the average market price of 8100 yuan/ton at the beginning of the month. At present, domestic boric acid traders offer prices ranging from 7000 to 7800 yuan/ton (actual transaction prices for different brands, specifications, and products are mainly negotiated).

At present, the foreign quotation for imported goods is concentrated between 7500-8000 yuan/ton (the actual transaction price of different brands, specifications, and products is mainly negotiated). According to the commodity market analysis system of Business Society, the average market price of imported boric acid is 7862.5 yuan/ton, which is 0.63% lower than the average market price of 7912.5 yuan/ton at the beginning of the month.

According to the commodity market analysis system of Business Society, the price of boric acid remained stable in December. As of December 25th, the average price of boric acid in the domestic market was 7462.50 yuan/ton, unchanged from the beginning of the month, and decreased by 7.87% from the average market price of 8100 yuan/ton at the beginning of the month. At present, domestic boric acid traders offer prices ranging from 7000 to 7800 yuan/ton (actual transaction prices for different brands, specifications, and products are mainly negotiated).

At present, the foreign quotation for imported goods is concentrated between 7500-8000 yuan/ton (the actual transaction price of different brands, specifications, and products is mainly negotiated). According to the commodity market analysis system of Business Society, the average market price of imported boric acid is 7862.5 yuan/ton, which is 0.63% lower than the average market price of 7912.5 yuan/ton at the beginning of the month.

According to the Commodity Market Analysis System of Business Society, the domestic PTA spot market slightly increased this week (December 18-24), with a market price of 5874 yuan/ton in East China as of December 24, an increase of 2.83% compared to the beginning of the week. Enhanced cost support combined with reduced supply of PTA itself has boosted the PTA market. Specifically:

Due to the recent regional situation, international oil prices have risen to a two-week high. As of December 21, the settlement price of the US WTI crude oil futures main contract was $74.22 per barrel, and the settlement price of Brent crude oil futures main contract was $79.16 per barrel. At present, there is still significant uncertainty in the situation in the Middle East, and the Red Sea shipping crisis may continue to disrupt the market in the short term; In addition, against the backdrop of the Federal Reserve’s upcoming interest rate cut cycle, the weak US dollar has provided long-term positive support for the oil market. However, considering the market’s concerns about the prospects of economic and energy demand, it is expected that crude oil prices will have significant volatility, with consolidation being the main trend.

From the perspective of PTA fundamentals, the recent unplanned load reduction and increased maintenance have resulted in an industry operating rate dropping to around 78%. This week, four sets of main suppliers in East China with an annual production capacity of 10.8 million tons of PTA equipment were reduced to 70% on Tuesday. At the same time, a set of 1.2 million tons of PTA equipment in the northwest was shut down this Wednesday. Unplanned PTA equipment was reduced in load and the supply of parking PTA was reduced. However, from next week’s perspective, there are still many load increasing devices, and there are currently no other planned large-scale PTA device maintenance. Therefore, the impact of PTA’s main supplier’s load reduction on the supply of goods is limited, and the overall supply of PTA’s goods will still be sufficient next week.

Downstream polyester production has remained stable around 86%, but as the end of the year approaches, orders from the terminal weaving industry have decreased. Considering the gradual weakening of polyester and terminal demand support, the overall accumulation pressure of polyester products is significant. Moreover, downstream factories lack confidence in the future market and have a strong mentality of purchasing raw materials on dips. The operating rates of terminal texturing, weaving, and printing and dyeing have partially declined, and the comprehensive operating rate of Jiangsu and Zhejiang weaving machines has dropped to around 73%. If orders continue to decrease, there is a strong expectation of “reducing burden”.

Business Society analysts believe that short-term international oil prices may fluctuate and adjust slightly, which still provides support for PTA costs. Secondly, polyester production may decrease next week, weakening support for PTA demand. In the short term, downstream demand will further decline, and the fundamentals of sufficient PTA supply are weak and difficult to improve. The market has expectations for sufficient PTA supply. Therefore, under the game of cost advantage support and weak supply and demand fundamentals, the high operating points of the current two markets are still constrained, and it is expected that there is not much room for PTA to continue to rise.

1、 Trend analysis

According to the monitoring of nickel prices by Business Society, on the 21st, the average spot nickel market price was 130808 yuan/ton, a decrease of 1.21% from the previous trading day.

On a macro level, following the announcement of the December interest rate decision by the Federal Reserve, market focus has shifted to the core US November PCE data released this Friday. The market is waiting for important data to be released in order to obtain new guidance, as the US dollar fluctuates. The oversupply of nickel continues to expand, while the overall market demand is weak, and the significant accumulation of nickel inventory has dragged down the price trend. One of the world’s largest nickel mining countries, the Philippines, has nickel mines with production costs higher than market prices, leading to a significant decline in shipments. Some mines have suspended shipments to avoid losses, and the nickel mining market has maintained a sluggish transaction situation. Recently, nickel ore prices have decreased, and it is expected that nickel will experience short-term weak fluctuations.

According to data monitoring by Business Society, as of December 20, 2023, the domestic market price of butanone was referenced at 7216 yuan/ton. Compared with December 1, 2023 (reference price of butanone was 7533 yuan/ton), the price decreased by 317 yuan/ton, a decrease of 4.20%.

From the monitoring chart of Business Society data, it can be seen that from December to present (12.1-12.20), the overall domestic butanone market has shown a weak downward trend. In early December, the domestic butanone market as a whole experienced a narrow downward trend, with loose downstream demand. The demand side provided insufficient support to the butanone market, and some butanone factories and suppliers slightly lowered the price of butanone by about 50-100 yuan/ton. As of December 10th, the butanone market experienced a decline of 0.88% in the first half of the year.

In the mid stage, the decline of the butanone market has not stopped, and downstream demand continues to be weak. The demand side continues to drag down the market, and the center of gravity of the butanone market has been continuously approaching at a low level. As of December 12th, the low-end price of butanone has dropped to around 7000 yuan/ton, followed by a weak consolidation operation in the market. On the 18th, some devices underwent temporary maintenance, and the expected supply of butanone in the field decreased. Some operators adjusted their mentality and raised the shipment price of butanone narrowly, with an increase of 50-100 yuan/ton, driving a slight correction in the butanone market. However, due to the limited boost from downstream demand, the rise of butanone was not continuous, and the market resumed consolidation and operation. As of December 20th, the domestic butanone market price reference was around 700-7600 yuan/ton.

Market Forecast and Analysis of Butanone

At present, the overall trading atmosphere in the butanone market is mild. The downstream of butanone has average digestion of raw materials, and procurement is mainly cautious and quantitative. The supply and demand pressure in the butanone market still exists. Business Society’s butanone data analyst believes that in the short term, the domestic butanone market is mainly adjusted and transitioned, and the specific trend still needs to pay more attention to the specific news changes on the supply and demand side.

This week, cobalt prices have stopped falling and stabilized

According to the cobalt market analysis system of the Business Society, as of December 19th, the price of cobalt was 214700 yuan/ton, a decrease of 1.96% compared to the cobalt price of 219000 yuan/ton on December 1st; The cobalt price has increased by 0.85% compared to December 11th at 212900 yuan/ton. The growth rate of the new energy vehicle market has slowed down, but the proportion of installed ternary batteries has rebounded. The shipment volume of mobile phones continues to decrease, and the demand for cobalt in the market is slowly growing. This week, cobalt prices have bottomed out and stabilized.

The proportion of installed capacity of ternary batteries has rebounded

According to data from the China Automotive Power Battery Industry Innovation Alliance, in terms of vehicle installation volume, in November, China’s power battery installation volume was 44.9GWh, a year-on-year increase of 31.0% and a month on month increase of 14.5%. The installed capacity of ternary batteries is 15.7 GWh, accounting for 35.0% of the total installed capacity; The installed capacity of lithium iron phosphate batteries is 29.1 GWh, accounting for 64.9% of the total installed capacity. In November, the installed capacity of ternary batteries increased significantly, and the proportion of ternary batteries slightly rebounded, leading to an increase in demand in the cobalt market.

Mobile phone sales rebounded

According to data from the China Academy of Information and Communications Technology, in October 2023, the shipment volume of mobile phones in the domestic market was 29.162 million units, a year-on-year increase of 19.7%. From January to October 2023, the total shipment volume of mobile phones in the domestic market was 230 million units, a year-on-year increase of 4.2%. The shipment volume of mobile phones has increased year-on-year, and the demand for cobalt in the mobile phone market has rebounded.

Overview and Outlook

According to Bai Jiaxin, a data analyst at Business Society, the sales growth of new energy vehicles in winter has slowed down, but the proportion of installed capacity of ternary batteries has increased; In October, the shipment volume of mobile phones increased significantly year-on-year, but after the Double Eleven and Double Twelve promotions, it once again entered a sluggish state. Consumers had planned to take advantage of the price reduction during the promotion to exchange phones, but major mobile phone manufacturers did not lower prices. The decrease in demand for phone replacements affected sales, and the shipment volume of mobile phones continued to decline, resulting in lower than expected demand in the cobalt market. Overall, the supply and demand balance in the cobalt market is relatively stable, and there is still downward pressure on cobalt prices in the future. The downward space for cobalt prices is limited, and it is expected that cobalt prices will consolidate at a low level in the future.

From December 11 to December 18, 2023, the antimony ingot market in East China slightly decreased, with prices remaining stable at 80500 yuan/ton this week.

K-bar chart of commodity prices, using the concept of price trend K-line, reflects the weekly or monthly price fluctuations in the form of a bar chart. Investors can buy and sell based on the changes in the K-bar chart. Red indicates an increase; Green indicates a decline; The height of the K-bar represents the range of fluctuations. From the above chart, it can be seen that the recent trend of the antimony ingot market has been relatively stable.

This week, the price of European strategic small metal antimony has declined, and as of December 18th, the price remained stable at $11350 per ton. Currently, the market atmosphere is weak.

The overall performance of the antimony ingot market has been relatively stable recently, and the downstream antimony oxide market has maintained a temporary stable operation for nearly a month, driving the stabilization of the raw material market. There was not much change in supply and demand during the week, and the supply at the mining end remained tight. However, this news has been largely digested, and its impact on the market is limited. With the recent stabilization of the market, the mentality of smelters to be reluctant to sell and raise prices has begun to increase. However, the tight supply at the mining end has not been improved, and the overall supply of antimony ingots is tight. In terms of demand, the downstream antimony oxide market still maintains procurement, providing essential support for the antimony ingot market. Overall, the supply of antimony ingots in the market is tight, and there is no clear guidance from the market. It is expected that the antimony ingot market will continue to operate temporarily and steadily in the near future. We will pay attention to changes in downstream demand in the future.

This week, the antimony oxide market continued to maintain a temporary stable operation, with a strong wait-and-see sentiment in the market. Overseas sales performance was average, and overall market expectations were weak. Antimony oxide enterprises maintained a rigid demand for antimony ingots, and are expected to operate steadily in the short term.

On December 17th, the non-ferrous index was 1092 points, unchanged from yesterday, a decrease of 29.00% from the highest point in the cycle of 1538 points (2021-10-18), and an increase of 79.90% from the lowest point of 607 points on November 24th, 2015. (Note: The cycle refers to 2011-12-01 present).

According to the price monitoring of Business Society, there were a total of 10 commodities in the non-ferrous sector that saw a month on month increase in the commodity price rise and fall list in the 50th week of 2023 (12.11-12.15). The top 3 commodities with the highest increase were silver (1.74%), dysprosium oxide (1.71%), and zinc (1.59%). There are a total of 8 products with a month on month decline, and the top 3 products with a decline are praseodymium oxide (-2.11%), dysprosium iron alloy (-1.35%), and praseodymium neodymium oxide (-1.10%). The average increase and decrease this week is 0.11%.

1、 Price trend

According to the Commodity Market Analysis System of Business Society, the domestic propylene (Shandong) market saw a slight increase this week (12.11-12.15). The average price in the Shandong market at the beginning of the week was 6968 yuan/ton, and the average price over the weekend was 7010 yuan/ton, with a weekly increase of 0.61% and a year-on-year decrease of 8.53%.

As of December 15th, the mainstream prices of propylene in different regions in China are as follows:

Region/ December 15th

Shandong region/ 6900-7000 yuan/ton

Northeast region/ 6650-6700 yuan/ton

East China region/ 7000-7050 yuan/ton

2、 Analysis and Review

According to the commodity market analysis system of Business Society, the propylene market rose first and then stabilized this week. During the week, crude oil prices rose on the news side, boosting confidence among businesses. At the same time, downstream devices have gradually resumed operation, and demand has also increased, further boosting the market. After the upstream actively pushed up, the market returned to stability.

3、 Future Market Forecast

The propylene analyst from the Chemical Branch of Shengyishe believes that there will be limited changes in the supply of propylene in the short term, and the demand side will gradually return to stability. It is expected that the propylene market will remain stable and weak next week.