This week, the overall price of melamine showed a stable trend, although there were slight fluctuations, there was no significant increase or decrease. As of December 17th, the benchmark price of melamine in Shengyi Society was 6405.00 yuan/ton, a decrease of -0.23% compared to the beginning of this month (6420.00 yuan/ton).

1、 Market situation

In the second half of 2024, the overall utilization rate of melamine production capacity was lower than that of the first half of the year, especially in mid October when the weekly production capacity rate of melamine fell to the low point of the second half of the year, which was the second low point of the year after the low point in mid July. Although there was a brief increase in capacity utilization due to the restoration of maintenance facilities, it subsequently declined again due to the shutdown and maintenance of some facilities.

2、 The impact of low capacity utilization on prices

1. Imbalance between supply and demand:

Low capacity utilization means insufficient production, but at the same time, due to sluggish downstream demand, this supply-demand imbalance has not led to price increases.

Especially in the sustained downturn of the real estate industry, downstream enterprises associated with it have low operating rates and overall insufficient demand, further exacerbating the supply-demand imbalance.

2. Intense market competition:

In the case of low capacity utilization, in order to maintain market share and sales revenue, enterprises may adopt a price reduction strategy to attract customers. This will lead to a further decline in market prices, making it difficult to recover.

3. Cost pressure:

Although low capacity utilization may reduce the allocation of fixed costs for enterprises, variable costs such as raw material costs and labor costs still exist. If companies are unable to cover these costs by raising prices, their profit margins will be further compressed.

3、 Prediction of Price Recovery Time

Due to the interweaving of various factors, it is difficult to accurately predict the rebound time of melamine prices. However, considerations can be made from the following aspects:

Improvement of supply-demand relationship: As downstream demand gradually recovers and new production capacity is effectively controlled, the supply-demand relationship will gradually become balanced, thereby driving up prices.

Rising raw material costs: If the price of raw material urea rises, it will increase the production cost of melamine, thereby providing support for market prices.

Increased export demand: With the recovery of the global economy and the increase in export demand, the export volume of melamine is expected to further increase, thereby driving up domestic prices.

4、 Future prospects

Fluctuations in raw material prices: There may still be some volatility in the future raw material urea market, which will have an impact on the production costs and prices of the melamine market. Enterprises need to closely monitor the dynamics of the raw material market and develop reasonable procurement and production plans.

Downstream demand changes: With the continuous development of the economy and the improvement of people’s living standards, the demand for melamine in downstream industries may show a new growth trend. Enterprises need to pay attention to changes in downstream demand and adjust their product structure and sales strategies in a timely manner.

Strengthening international cooperation: Enterprises should actively seek opportunities for international cooperation, expand overseas markets, and increase export volume. This can not only alleviate the supply and demand pressure in the domestic market, but also enhance the international visibility and brand influence of the enterprise.

In summary, low capacity utilization is one of the important factors currently restricting the recovery of melamine prices. In order to drive up prices and enhance the profitability of enterprises, they should closely monitor changes in downstream demand, optimize production capacity structure, and strengthen international cooperation.

According to the Commodity Market Analysis System of Shengyi Society, the PET market price has slightly increased today. As of December 17th, its average market price is 6162 yuan per ton.

International oil prices have continued to rise, with strong cost support and a significant increase in polyester raw material prices. Driven by costs, today’s PET spot market prices have also risen. However, considering the approaching end of the month, some holders may face pressure to store and ship, which may limit the upward trend of PET.

Overall, the PET market prices may continue to fluctuate narrowly in the short term. The actual trend still needs to pay attention to the follow-up equipment, demand situation, and cost support under the traction of crude oil.

According to the analysis of the Business Society’s market monitoring system, on December 16th, the reference market price for domestic silicon metal # 441 was 11860 yuan/ton, a decrease of 210 yuan/ton or 1.74% compared to December 1st (market price of silicon metal # 441 was 12070 yuan/ton).

From the market monitoring system of Shengyi Society, it can be seen that in early December, the domestic spot market for silicon metal # 441 showed an overall weak downward trend, with market prices approaching low levels. Recently (12.13-12.16), the spot market for silicon metal continued to decline, with many regions in China including silicon metal grades # 553, 552, 441, 421, etc. experiencing a downward adjustment. Among them, the market price of silicon metal 553 # (oxygen) in East China decreased to 11300-11400 yuan/ton, with a price reduction of 100 yuan/ton. The market price of silicon metal 441 # in East China decreased to 11700-11900 yuan/ton, with a price reduction of 100 yuan/ton. The market price of silicon metal 421 # in Guangdong decreased to 11535-11585 yuan/ton, with a price reduction of 120 yuan/ton. As of December 16th, the domestic market price reference for metallic silicon 441 # is around 11500-12200 yuan/ton.

Recently, the spot market for silicon metal has been experiencing a downward trend. On the one hand, recently, the market for silicon metal futures has continuously fallen to market lows, intensifying the negative impact of futures on the spot market. On the other hand, as winter approaches, a weak supply-demand situation is gradually forming in the metal silicon market. On the supply side, the overall operating rate of the metal silicon market continues to decline, and the expected production of metal silicon is reduced. On the demand side, the overall operating rate of the downstream polycrystalline silicon market remained unchanged compared to last week, but the monthly operating rate decreased slightly by about 25%. The operating rate of downstream enterprises has decreased, resulting in a decrease in demand for raw materials. Currently, there is a strong wait-and-see sentiment in the downstream market of silicon metal, with a lack of enthusiasm for new order purchases. The market is dominated by low-priced transactions, and the overall supply and demand transmission in the silicon metal market is weak.

Market analysis in the future

At present, the overall trading atmosphere in the metal silicon market is relatively light, and the market continues to decline with strong market sentiment. The weak downstream demand affects the confidence of industry players. Although the market has lowered production, there is still some pressure to ship in some areas. The current market lacks positive support as a whole. The metal silicon data analyst from Shengyi Society believes that in the short term, the domestic metal silicon market is mainly weak and consolidating, and specific changes in supply and demand news need to be closely monitored.

Analysis: This week (12-9-12), the liquid ammonia market in Shandong has not yet escaped the downward channel, with prices fluctuating and falling. According to the Commodity Market Analysis System of Shengyi Society, the main production area of Shandong experienced a weekly decline of 1.32%. The main reason for the increase in supply pressure is that the maintenance equipment in the early stage has been gradually restored, and the operating rate of manufacturers has increased. Coupled with the sluggish urea market, some manufacturers have switched to ammonia, which has further exacerbated the contradiction of oversupply in the ammonia market. From the beginning of the week to the weekend, some mainstream large factories in Shandong generally lowered their prices by 50-100 yuan/ton. Distributors mainly underreport shipments. And downstream procurement enthusiasm is not high, agricultural demand is still in the off-season, industrial demand remains rigid, and the overall demand side is bearish. At present, the mainstream quotation in Shandong region is between 2600-2750 yuan/ton.

Prediction: Due to seasonal reasons, fertilizer procurement is off-season, downstream operating rates have significantly decreased, industrial demand has followed suit, supply is sufficient, and later supply pressure may not be resolved for a long time. But the imagination of regional differentiation in the later stage of the market may become increasingly prominent. On the one hand, the operating rate will decline with the decrease of prices. On the other hand, rainy and snowy weather in Northeast China, Inner Mongolia and other places may put pressure on transportation, and there may be a shortage of local supply. Considering all factors, the price of liquid ammonia may still be difficult to improve next week, but some regions may stop falling and stabilize. Local differentiation may bring about price fluctuations.

Since the beginning of this week, the domestic PTA spot market has seen a slight upward trend, with relatively strong raw materials boosting PTA prices. According to the Commodity Market Analysis System of Shengyi Society, as of December 12th, the average price of PTA market in East China was 4734 yuan/ton, an increase of 1.14% from the beginning of the week.

Although OPEC has lowered its global demand forecast for five consecutive months in its monthly report, the decrease in US crude oil inventories has been offset by an increase in refined oil inventories. However, China’s boost to the economy may increase oil demand, and European and American crude oil futures have risen for the third consecutive day. As of December 11th, the settlement price of the main contract for WTI crude oil futures in the United States was $70.29 per barrel, and the settlement price of the main contract for Brent crude oil futures was $73.52 per barrel.

Self supplied, the 1.1 million ton PTA plant of Zhuhai Ineos underwent maintenance for over 20 days in early December. The total production capacity of PTA at Jiaxing Petrochemical is 3.7 million tons per year, of which the 1 # 1.5 million ton units underwent maintenance on December 12th, and the restart time is yet to be determined. The supply has slightly decreased, and the PTA industry is operating at around 88%.

The trading atmosphere for cold resistant fabrics at downstream textile terminals is still good, and the atmosphere for inquiries about some spring orders is good. Intermediaries and traders only stock up on demand, and the delivery of domestic and foreign trade orders is coming to an end. As of December 11th, the comprehensive operating rate of chemical fiber weaving in Jiangsu and Zhejiang regions is less than 69%.

Looking ahead, crude oil prices have risen to their highest point of the week, providing stronger support for PTA costs. Under partial device maintenance, domestic PTA supply remains high. We are concerned about the progress of Dushan Energy’s 2.7 million ton PTA new device scheduled to start production in mid December next week. With the impact of the off-season consumption, it is expected that the downstream transaction atmosphere will further weaken, and there is an expectation of weakened demand. Overall, without sustained positive drivers, PTA prices will fluctuate weakly and adjust in the short term.

The price of melamine has fluctuated slightly this week, but the overall trend remains stable. On December 11th, the benchmark price of melamine in Shengyi Society was 6412.50 yuan/ton, a decrease of -0.12% compared to the beginning of this month (6420.00 yuan/ton).

2、 Price Trend Analysis

From the above data, it can be seen that the overall price of melamine has shown a stable trend this week, although there have been slight fluctuations, there has not been a significant increase or decrease.

1. Market supply-demand balance: Currently, the supply and demand in the melamine market are relatively balanced, and the deployment of new production capacity has maintained a certain degree of matching with downstream demand growth, thereby slowing down the direct impact of raw material price fluctuations on the melamine market.

2. Inventory adjustment: Some melamine production enterprises may adjust their inventory to cope with fluctuations in raw material prices, thereby stabilizing market prices to a certain extent.

3. Stable production capacity: During this week, the production capacity of the melamine industry remained relatively stable, with no large-scale increase or decrease in production, which helps maintain the smooth operation of the market.

4. Stable downstream demand: The demand for melamine in downstream industries such as sheet metal and coatings remained stable this week, without significant growth or decline, which to some extent supported the stable operation of the melamine market.

3、 Future market outlook

Although the melamine market remained stable this week, there is still some uncertainty in the future market trend. Here are some prospects for the future market:

1. Fluctuations in raw material prices: There may still be some volatility in the future raw material urea market, which will have an impact on the production costs and prices of the melamine market. Enterprises need to closely monitor the dynamics of the raw material market and develop reasonable procurement and production plans.

2. Changes in downstream demand: With the continuous development of the economy and the improvement of people’s living standards, the demand for melamine in downstream industries may show a new growth trend. Enterprises need to pay attention to changes in downstream demand and adjust their product structure and sales strategies in a timely manner.

In summary, the melamine market remained stable this week against the backdrop of fluctuations in raw material urea, mainly due to factors such as market supply and demand balance, inventory regulation, and policy regulation. Future enterprises need to closely monitor market dynamics and policy changes, and develop reasonable business strategies to cope with potential market risks.

According to the Commodity Market Analysis System of Shengyi Society, the PP market was mainly consolidated in early December, with some brand products experiencing price increases. As of December 10th, the mainstream offer price for wire drawing by domestic producers and traders is around 7641.67 yuan/ton, a rise or fall of+0.27% compared to the price level at the beginning of November.

Price trend

In terms of raw materials:

In terms of international crude oil, the previous oil prices were affected by various factors such as the US election, resulting in low prices. Currently, the bearish effect has weakened, and the positive impact of the OPEC+production reduction plan delay is still present. International oil prices have rebounded from the decline, strengthening support for PP’s upstream in the far end. In terms of propylene, local areas such as North China have tight supply, while downstream operating rates have rebounded. Supported by this, propane has shown a stable but slightly upward trend in the past ten days. PDH has been operating steadily due to the overall low inventory in the industry. Overall, in early December, PP raw materials remained stable with small increases, and the cost support was still acceptable.

Supply side:

In early December, domestic PP enterprises experienced a combination of maintenance and production, and the overall load level continued the stable trend of the previous period. Overall, the industry’s overall load has only decreased by 1% from around 75% at the beginning of the month. The domestic PP shipment volume is flat, and the inventory level is around 650000 tons. Although the supply is still abundant, some new production facilities have been delayed, supporting the mentality of some operators. Overall, the supply side provides average support for PP spot prices.

In terms of demand:

At present, the demand side of PP tends towards rigid demand. Due to seasonal factors, the consumption level of woven bags such as fertilizers, cement, and rice remained stable with a slight decrease during the first ten days. The consumption level of plastic weaving has also declined narrowly, and the willingness to hold positions has cooled down; As the end of the year approaches, the decline in enterprise construction and stocking up are intertwined. The release of demand for partial pre holiday replenishment has to some extent boosted consumption. Overall, the demand side tends to have weak fluctuations in most aspects.

Future forecast

In early December, the domestic PP market prices saw a narrow upward trend. Fundamentally speaking, the overall performance of upstream raw materials in supporting PP is still acceptable. The supply within the range has leveled off, but some of the equipment put into production has been delayed to boost the confidence of regular operators. According to consumer feedback, businesses are cautious about future terminal consumption, and there is a risk of further contraction in subsequent orders. In the short term, it is expected that PP prices will remain stagnant.

Price trend

According to the bulk ranking data of Shengyi Society, the domestic PC market fluctuated and rose in early December, with some spot prices of certain brands rising narrowly. As of December 9th, the mixed benchmark price of Business Society PC is around 16000 yuan/ton, with a price increase or decrease of+0.73% compared to early December.

Cause analysis

On the supply side, the overall operating rate of PC in China has rebounded in early December. Jiaxing Emperor and other companies that entered the maintenance phase gradually returned, and the industry average operating rate increased from 75% at the beginning of the month to over 80%. The average weekly production of PC remains at a super high level of around 60000 tons. The on-site supply of goods is still abundant, and the mismatch between supply and demand remains unchanged. The high inventory has made it difficult for manufacturers to raise prices, and the auction market is also not optimistic. The market supply side is not providing good support for PC prices.

In terms of raw materials: As can be seen from the above chart, after the rapid downward trend of bisphenol A in China in the early stage, the spot price at the end of last month has reached a low point. In addition, some companies’ maintenance and delayed production of new equipment have added to the positive news on the supply side. At the end of last month, the shipment of raw material phenol was delayed at the port, while the main downstream PC and epoxy resin stocks were stable. Influenced by various favorable factors, the price of bisphenol A rebounded, and the mentality of the industry strengthened. Overall, bisphenol A remains stable and strong, providing increased support for PC costs.

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. The logic of weak rigid demand purchasing in the market continues, and the wait-and-see sentiment of industry players is biased. As the end of the year approaches, downstream factories are taking over goods to maintain production, and buyers are resistant to high priced goods. Purchasing and price chasing operations are cautious, and only some companies have seen an increase in operating rates. The slow circulation of goods in the market has limited changes, and the demand side has poor support for PC spot prices.

Future forecast

The PC market was generally stable with some gains in early December. The upstream bisphenol A market has risen, providing strong support for PC costs. Within the past ten days, the load of domestic polymerization plants has rebounded by more than 5%, with loose supply remaining unchanged. At the same time, the industry’s inventory is high, and there has been no substantial improvement in supply pressure. The downstream stocking pattern has not changed, making it difficult to drive market trends. Business Society believes that the reasons for this upward trend are twofold: firstly, PC prices have fallen below the annual low, and secondly, the cost side benefits brought about by the rise in raw materials. However, the profound mismatch between supply and demand cannot be alleviated in the short term, so the future PC market may be hindered from rising. It is recommended to closely monitor the trend on the cost side.

According to the monitoring of the commodity market analysis system of Shengyi Society, the magnesium ingot market in Shaanxi Province fell this week (12.1-12.6), with an average market price of 16466 yuan/ton at the beginning of the week and 16366 yuan/ton at the end of the week, a decrease of 0.61%.

This week’s market analysis

Since early December, the magnesium ingot market has continued to consolidate weakly and remain cautious. The market is influenced by the mentality of “buying up, not buying down”, and downstream buyers are more cautious. Starting this week, magnesium prices have continued their downward trend from last month, and as of the end of this week, prices have shown a stable trend.

Production end

The further decline in magnesium prices has made production and operation more difficult for factories. Most factories are unwilling to make losses in transactions, and the situation of production stoppage and reduction has intensified. Market transactions have further shrunk, and some manufacturers with high financial pressure have shipped in small quantities. Some factories have stopped production on the news side.

Supply and demand side

At present, it has become the norm for supply to exceed demand, and it is difficult to reverse in the short term. Due to the fact that production costs are inverted, some factories have stopped production and reduced output. In addition, there were rumors of a “reserve purchase” over the weekend, which had a slight impact on stopping the decline of magnesium prices.

comprehensive analysis

The sustained decline in magnesium prices in the short term has had an impact on confidence within the magnesium metal industry. In the short term, the supply and demand sides may be in a stalemate game, and the industry sentiment is mainly cautious and wait-and-see. The expected trend next week is mainly consolidation. More attention should be paid to the situation of factory shutdown.

According to the commodity analysis system of Shengyi Society, the market for locally refined petroleum coke continued to rise in November. The mainstream average price of petroleum coke products from major domestic refineries was 1583.25 yuan/ton on December 5th and 1478.50 yuan/ton on November 1st, with a monthly increase of 7.08%.

Cost aspect: The international oil price market in November was mainly volatile, with a significant increase in crude oil market prices at the beginning of the month, and a gradual decline in crude oil prices in the later period. Overall, the crude oil market situation did not change much. On the one hand, the unstable geopolitical situation in the Middle East remains one of the important factors affecting the crude oil market. On the other hand, crude oil supply remains tight, and OPEC’s production reduction plan of 2.2 million barrels per day has been extended until the end of December, indicating continued supply constraints. However, the outlook for crude oil demand is not optimistic, which is suppressing the crude oil market price. Overall, the crude oil market price is mainly fluctuating widely.

Supply side: The price of locally refined petroleum coke continued to rise in November, with good transactions; The supply of low sulfur coke is tight, the inventory of medium and high sulfur coke is low, and the shipment is good. The downstream negative electrode material and aluminum carbon market are actively receiving goods. In addition, the low sulfur sponge coke market resources at the port are tight in November, and the market shipment is not under pressure.

On the demand side: Currently, the overall trading atmosphere in the domestic silicon metal market is relatively quiet. As the overall operating expectations continue to decline, the pressure on the silicon metal supply side is controllable. Although the transmission performance between supply and demand is still average, it will be able to maintain weak stability. Currently, the main refineries have stopped supplying petroleum coke to the fuel and silicon industries, pushing up the price of imported low sulfur petroleum coke.

The market for medium sulfur calcined coke rose in November, with the price of petroleum coke, a raw material for medium high sulfur calcined coke, continuing to rise. Downstream negative electrode enterprises still have decent demand, supporting the calcined coke market.

Due to the implementation of the aluminum export tax rebate policy on December 1st, the frequency of overseas buyers’ inquiries and the pace of rushing for exports have continued to accelerate recently. In late November, the downstream demand for aluminum ingots was still strong, and the off-season was not weak. In December, with the slowdown of downstream export pace, there may be negative feedback on the aluminum ingot market, and the expectation of a off-season may come. Aluminum carbon enterprises mainly purchase petroleum coke for essential needs.

Future forecast: Currently, the downstream negative electrode materials and aluminum carbon markets in the petroleum coke market are actively receiving orders; The main refinery has stopped supplying fuel and silicon industries; The supply of imported low sulfur sponge coke is tight, and refineries continue to raise the price of petroleum coke. It is expected that the price of petroleum coke will continue to rise slightly in the near future.