1、 Trend analysis

 

According to data from Shengyi Society, copper prices will experience wide fluctuations throughout 2025. The highest point for copper prices in 2024 was 87121.67 yuan/ton on May 20th, and the lowest point was 67996.67 yuan/ton on January 17th, with a maximum amplitude of 28.12%.

 

2、 Market Review

 

The annual trend of copper prices can be divided into five stages:

 

Phase 1 (January March): No significant driving force, copper prices continue to fluctuate and consolidate in a narrow range as in the previous period;

 

Phase 2 (mid March to the end of May): Macro fund allocation, supply side driven, copper prices hit a historic high;

 

Phase Three (late May to early August): Expectations of a Federal Reserve interest rate cut fell through, manufacturing PMI in China and the United States declined, high copper prices suppressed downstream demand, and prices rapidly declined;

 

Phase Four (August to early October): The Federal Reserve initiates interest rate cuts, domestic stimulus policies are frequent, copper demand improves during the Golden September and Silver October periods, and copper prices rebound slightly;

 

Phase 5 (October to the end of the year): Trump wins the election, the US dollar strengthens, suppresses copper prices, and slightly falls.

 

Supply side

 

Gamma-PGA (gamma polyglutamic acid)

Domestic copper production capacity and output from 2011 to 2024

 

According to data, China’s refined copper production in November was 1.133 million tons, a year-on-year decrease of 1.6%. The cumulative production of refined copper (electrolytic copper) from January to November reached 12.451 million tons, a year-on-year increase of 4.6%.

 

Copper import and export data

 

According to customs data, the import volume of copper is much larger than the export volume, and the import volume of copper in 2024 is basically the same as that in 2023. The expected import volume of refined copper in China in 2024 is 3.51 million tons, a year-on-year decrease of 0.28%. The expected domestic export volume of refined copper in 2024 is 490000 tons, a year-on-year increase of 75.5%.

 

LME copper inventory affects copper prices

 

As shown in the above figure, the comparison between LME copper inventory and copper prices shows that copper prices and inventory are inversely proportional, with LME copper inventory falling and copper prices rising; LME copper inventory rises, while copper prices fall. The judgment of copper prices can be predicted based on LME copper inventory. As of December 31st, LME copper inventory was 271400 tons, up 38.94% from the beginning of the year.

 

In terms of demand

 

Copper apparent consumption

 

As shown in the above figure, according to the statistics of Shengyi Society on the apparent consumption of copper in China in recent years, except for the period from 2015 to 2017 when some manufacturers stopped production and production due to the decline in copper prices, the apparent consumption of copper has decreased. In other years, except for the impact of the pandemic in 2021, the apparent consumption of copper has been increasing year by year. According to data statistics, the apparent consumption in 2024 was 16.4128 million tons, and the annual apparent consumption in 2024 was higher than that in 2023.

 

Domestic copper terminal consumption is mainly concentrated in industries such as power cables, home appliances, automobiles, and real estate. Among them, power cables account for nearly 37%, buildings account for 21%, household appliances (such as air conditioning and refrigeration equipment) account for 15%, and the automotive industry accounts for 8%.

 

Power cables:

 

The growth rate of completed power grid investment and construction from January to October this year exceeded expectations by 20%, far higher than the same period in the past two years. Conservatively, it is expected that the growth rate of power grid investment in 2025 will maintain a 6% growth rate, which will bring a 3% growth boost to overall copper consumption. The investment targets of State Grid 609.2 billion and Southern Power Grid 195.3 billion for the power grid in 2024 will continue to break post epidemic records. It should be noted that the completion rate of power grid investment and construction from January to October has reached 74%, which is higher than the historical average of 70% and close to the high level of 2017. It is expected that the growth rate of copper investment and construction in the domestic power grid will be limited by the end of the year. In addition, the core of State Grid at present and in the future is the dual wheel drive of ultra-high voltage and smart distribution network. It is expected that more incremental cable orders in the future will be related to aluminum and aluminum alloys.

 

Construction and completion of real estate across the country

 

The negative growth rate of construction and completion is expected to stabilize, but copper used in construction will still be a drag. This year, the growth rate of completed area in China has decreased much more than expected compared to last year’s high base, while the growth rate of new housing construction has been sluggish and has not improved. The cumulative completed area in the first 10 months of this year decreased by 24% year-on-year, with an annualized decrease of 8.36%. The cumulative newly started area in the first 10 months decreased by 23% year-on-year, with an annualized decrease of 24.5%. Although China further introduced stimulus policies in the third quarter of this year, considering the current sluggish sales of pre-sale housing in the residential sector and the 2-3 year lag in sales of completed real estate companies, even strong stimulus policies have a transmission period of physical tools. Therefore, it is expected that the growth rate of construction area in 2025 will remain at a level of -15% to 25%, which is the same as the negative growth rate in 2024. The neutral estimate is that there will still be a 20% year-on-year negative growth rate for copper used in construction (excluding household appliances), which will drag down overall consumption by about -4.4%.

 

The home appliance industry: In 2024, home appliance consumption exceeded expectations, mainly due to the overseas replenishment cycle and China’s trade in subsidy policy. Under domestic and foreign policies and cycles, the production growth rates of air conditioners, refrigerators, freezers, and washing machines in China reached 8.2%, 8.5%, 15.2%, and 6.7% respectively in the first ten months of this year. Considering the current high inventory of air conditioners in China and the fact that the boost to the home appliance industry this year is mainly related to policy support, the sustainability of industry recovery is expected to be limited. It is expected that the growth rate of home appliance consumption will slightly decline to 5% by 2025, and it will still maintain strong resilience in the copper consumption field.

 

Automobile production

 

In terms of automobiles, the growth rate of China’s automobile production in the first ten months of 2024 was only 3%, far lower than the cumulative year-on-year growth rate of the same period from 2021 to 2023, mainly due to the current high base of China’s automobile production. After reaching a peak of 33% in 2021, the penetration rate of China’s automobile production has fallen to 32% in 2022-2023. Combined with the trend of slowing down the growth rate of production in 2024, it is expected that the penetration rate of China’s automobile production will continue to fall to 31% to 32% in 2024.

 

3、 Factors influencing 2024

 

Add crude copper smelting capacity by 2025

 

By 2025, it is expected that an additional 1.27 million tons of crude copper smelting capacity will be released globally, which is a decrease from the 1.68 million tons of new capacity in 2024. However, the conflict between mining and metallurgy will continue. This year, global smelting capacity is still concentrated in Asia, with China contributing 54% of the increase and Indonesia contributing nearly 30% of the increase. In 2025, the global crude refining capacity growth rate will slow down, and China’s contribution will decline to 32%, while the Kamoa project in the Democratic Republic of Congo will contribute 38% of the increment.

 

The peak period of mining processing fees has passed

 

Without considering whether the Panama copper mine will resume production or not, it is expected that the global copper mine production will increase by about 780000 tons in 2025, a slight decrease from last year, indicating that the tight mining situation will continue. Global copper mining project reserves are gradually depleting, with few new projects and limited ore supply. Global copper production is expected to decrease by 0.3% in 2024, and although it is expected to increase by 1.2% in 2025, the increment is far lower than the newly added smelting capacity, and some copper mines are experiencing production cuts. Although new and old mines are resuming production under the stimulation of high copper prices, the tight supply situation is difficult to fundamentally reverse, which will fundamentally support copper prices.

 

Copper mine supply remains tight in 2025

 

Without considering whether the Panama copper mine will resume production or not, it is expected that the global copper mine production will increase by about 780000 tons in 2025, a slight decrease from last year, indicating that the tight mining situation will continue.

 

Global copper mining project reserves are gradually depleting, with few new projects and limited ore supply. Global copper production is expected to decrease by 0.3% in 2024, and although it is expected to increase by 1.2% in 2025, the increment is far lower than the newly added smelting capacity, and some copper mines are experiencing production cuts. Although new and old mines are resuming production under the stimulation of high copper prices, the tight supply situation is difficult to fundamentally reverse, which will fundamentally support copper prices.

 

The utilization rate of smelting capacity has decreased

 

Due to the reduction in ore supply and the relative excess investment in smelting capacity in the past, the utilization rate of smelters has dropped below 70%, increasing smelting costs and limiting the rate of production increase for refined copper, thereby supporting copper prices.

 

Copper concentrate processing fees decrease

 

Due to tight supply, copper concentrate processing fees are expected to significantly decrease by 2025, possibly reaching a 15 year low. Some smelters are facing profit pressure and may delay production or maintenance, reducing market supply and supporting copper prices.

 

Demand growth in the field of new energy

 

The new energy vehicle industry continues to develop, and it is expected that the global sales growth rate of new energy vehicles will be around 23.85% by 2025, which will bring a new increase in copper demand of 656000 tons, and the growth rate may slightly decrease. In addition, the demand for copper in new energy sectors such as photovoltaics and wind power is steadily increasing, providing strong support for copper prices.

 

Macro policies stimulate demand

 

Looking forward to 2025, there is great uncertainty for the Federal Reserve to cut interest rates. The European Central Bank and the Bank of Japan will gradually enter a wait-and-see state, and the People’s Bank of China may implement moderately loose monetary policy. The future trend of the US dollar may remain high, putting some pressure on copper prices in the external market. The RMB exchange rate may be weak, and copper prices in the domestic market may continue to be stronger than those in the international market.

 

4、 Summary and prediction

 

2024 is a turbulent year for the copper market, with significant fluctuations and a wide range of trends. The second quarter reached a historic high. Overall, the global copper market is in a pattern of oversupply in 2024. This is also the fundamental reason why copper prices cannot be sustained after a rapid rise.

 

Looking ahead to 2025, the global copper market supply and demand pattern will gradually shift from oversupply this year to supply-demand balance. The significant decrease in smelting costs (TC/RC) has put significant operational pressure on a large number of domestic smelters, and the tight supply of copper concentrate will begin to constrain the production of electrolytic copper. The downstream demand growth rate is expected to accelerate compared to 2024, and China and the United States are expected to initiate active inventory replenishment. Domestic power grid investment, household appliance consumption, and new energy vehicle production are all expected to maintain high growth rates. Overseas demand is expected to gradually recover with further interest rate cuts by global central banks, and global copper inventory levels are expected to decrease year-on-year.

 

Copper prices are expected to maintain high levels in 2025, but it is difficult to break out of the trend market. The annual volatility is expected to be smaller than in 2024, and the low point for the year is expected to be higher than in 2024, but the high point is difficult to break through. In the first half of the year, due to factors such as tight supply, peak demand season, and policy expectations, copper prices may show a fluctuating upward trend and are expected to hit above $10000/ton. In the second half of the year, as the risk of a US economic downturn increases and market demand relatively weakens after some peak demand periods, copper prices may face some downward pressure. However, due to the continued tight supply situation, the possibility of a significant drop in copper prices is relatively small, and it is expected to fluctuate and adjust within a high range.

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Under the push up of costs, the domestic PTA spot market has shown an upward trend since January. According to the Commodity Market Analysis System of Shengyi Society, as of January 13th, the average price of PTA market in East China was 4963 yuan/ton, an increase of 3.63% from the beginning of the month.

 

Gamma-PGA (gamma polyglutamic acid)

The US Treasury Department has imposed comprehensive sanctions on a European country’s oil industry, intensifying market concerns about disruptions in its oil supply. International crude oil prices have risen sharply. As of January 10th, the settlement price of the main contract for WTI crude oil futures in the United States was $76.57 per barrel, and the settlement price of the main contract for Brent crude oil futures was $79.76 per barrel. In addition, with the announcement of production cuts and shutdowns in multiple PX facilities both domestically and internationally, PX has opened up wide and high. Both crude oil and PX prices have strengthened, and rising costs have boosted the PTA market.

 

In terms of self supply, Jiaxing Petrochemical’s 1.5 million ton PTA plant underwent maintenance on December 12th and will restart on January 13th, 2025. Rolex’s 1.25 million tons will undergo maintenance around January 13th. The current spot market supply is still sufficient, and the industry operating rate is around 83%.

 

Downstream polyester production is around 84%, and multiple polyester units have announced official shutdown and maintenance plans, resulting in a short-term decrease in polyester production. As the Spring Festival approaches, the operating rate of terminal looms has declined, and the stocking phase has come to an end.

 

Business analysts believe that the factor of rising costs dominates the PTA market, but its sustainability is highly uncertain, and it is expected that the subsequent increase in PTA prices will be limited.

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According to the Commodity Market Analysis System of Shengyi Society, after New Year’s Day, the market for hydrogen peroxide continued to weaken, with a slight decrease in prices. On January 1st, the average market price of hydrogen peroxide was 700 yuan/ton, and on January 10th, the average market price of hydrogen peroxide was 696 yuan/ton, a decrease of 0.48% in price.

 

Gamma-PGA (gamma polyglutamic acid)

Loose supply, weak decline in hydrogen peroxide

 

After New Year’s Day, the hydrogen peroxide market remained weak and mainly consolidated. Mainly due to manufacturers shutting down for maintenance, inventory prices remain stable.

 

The terminal caprolactam, papermaking, and printing industries have seen a decline in the purchase of hydrogen peroxide, resulting in weak demand. The mainstream price in the hydrogen peroxide market in Shandong region is around 650 yuan/ton; The mainstream price in the hydrogen peroxide market in Hebei region is 670 yuan/ton; The mainstream price for hydrogen peroxide in the Anhui region is 780 yuan/ton.

 

Business Society’s hydrogen peroxide analyst believes that as the end of the year approaches, demand from terminal manufacturing manufacturers will decline, and the hydrogen peroxide market will continue to operate weakly in the future.

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This week (1.1-1.10), the nickel market rebounded. According to the monitoring of nickel prices by Shengyi Society, on January 10th, spot nickel was reported at 127191 yuan/ton, with a weekly increase of 1.37%.

 

Macroscopically, US economic data shows that the overall job market is stable, indicating that the Federal Reserve may slow down the pace of its interest rate cut cycle, which supports the rise of the US dollar exchange rate and is bearish on nickel prices; China’s CPI and PPI data have been released one after another, and the central bank has released positive signals to boost market sentiment.

 

On the supply side, the shipping capacity of Philippine mines is limited, nickel ore prices remain firm, and cost support is strong. The electrolytic nickel market remains loose. On January 10th, the inventory of Shanghai nickel warehouse receipts was 27558 tons, a decrease of 1231 tons during the week, but the pressure of destocking still exists; On January 9th, LME nickel inventory was 164310 tons, an increase of 3774 tons for the week.

 

In terms of demand: As the Spring Festival approaches, the demand for nickel in areas such as alloys, batteries, and stainless steel in the spot market is expected to continue to grow, but overall activity is still limited.

 

Market forecast: There is still resistance to the upward movement of nickel prices due to inventory pressure, but with production control in the mining sector and expectations of economic recovery, it is expected that nickel prices may experience strong range fluctuations.

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According to the analysis of the Business Society’s market monitoring system, on January 9th, the reference price for domestic silicon metal # 441 was 11520 yuan/ton. Compared with January 5th (silicon metal # 441 market price of 11560 yuan/ton), the price decreased by 40 yuan/ton, a decrease of 0.35%. Compared with January 1st (silicon metal # 441 market price of 11690 yuan/ton), the price decreased by 170 yuan/ton, a decrease of 1.45%.

 

Gamma-PGA (gamma polyglutamic acid)

From the market monitoring system of Shengyi Society, it can be seen that as we enter this week, the overall downward trend of the domestic spot market for silicon metal is difficult to change. The price of silicon metal is still hovering at a low level, and in some areas, the center of gravity of silicon metal continues to move towards a low level, with a price reduction of around 50-100 yuan/ton. As of January 9th, the spot price reference for metallic silicon 441 # in East China is 11400~11600 yuan/ton, with a price reduction of 100 yuan; The market price reference for metal silicon 441 # in Kunming area is 11500~11600 yuan/ton, and the price will be lowered by 100 yuan/ton; The market price reference for metal silicon 441 # in Huangpu Port area is 11400-11500 yuan/ton, with a price reduction of 100 yuan/ton; The market price reference for metal silicon 441 # in Tianjin area is 11300~11500 yuan/ton, with a price reduction of 50 yuan/ton.

 

Analysis of Market Factors

 

In terms of supply and demand: Currently, the overall trading atmosphere in the silicon metal market is light, and the pace of market shipments is not active. There is some supply pressure on the supply side in some regions, and it is difficult for factories to stimulate downstream purchasing enthusiasm even if they actively ship. At present, the downstream market’s demand for purchasing silicon metal has weakened, and the market’s destocking performance is poor. The overall transmission between supply and demand is insufficient, and the contradiction between supply and demand is more obvious.

 

Market analysis in the future

 

At present, the market sentiment in the metal silicon field is still strong, and the pre holiday market stocking sentiment is poor. The mentality of the industry is average. The metal silicon data analyst of Business Society believes that in the short term, the domestic metal silicon market will mainly adjust and operate in a narrow range, and specific changes in supply and demand information need to be paid more attention to.

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According to the Commodity Market Analysis System of Shengyi Society, the domestic PTA price fluctuated downward in 2024. As of December 31, the average market price in East China was 4790 yuan/ton, a decrease of 19.22% from the beginning of the year.

 

It can be roughly divided into four stages:

 

From January to early July 2024, PTA prices showed an overall range of fluctuations. Although crude oil surged and fell in the first half of the year, it provided some upward support for PTA costs. With the new production capacity put into operation, PTA supply is abundant. Combined with weak demand performance, downstream procurement maintains essential demand. Under the game of strong cost and weak supply and demand, the PTA price range is consolidating.

From early July to early September, the center of gravity of crude oil prices shifted downwards, and under the multiple pressures of continuous release of new PTA production capacity and supply-demand imbalance, PTA prices experienced a significant decline, with a drop of over 22%.

 

From early September to early October, driven by favorable macroeconomic and crude oil conditions, the PTA price center of gravity significantly recovered upwards, with an increase of over 11%.

 

From early October to December, crude oil rose to the high point of the range and then fell back again. Demand improved but did not have sustainability, and PTA new production capacity was released. Under multiple negative factors, PTA prices adjusted weakly.

 

Compared with 2023, the price trend in the first half of the year is basically consistent, but there is a significant differentiation in the second half of the year. In 2024, there will be a significant decline, and as of the end of the year, it will be at a low level in nearly three years.

 

Looking ahead to 2025:

 

In terms of production capacity, PTA will add 7.5 million tons of new capacity in 2024. As of the end of 2024, the total PTA production capacity will reach 86.02 million tons, with a capacity growth rate of 6.7%. At the same time as adding new production capacity, the process of phasing out outdated production capacity has begun. Some new facilities have stronger cost competitiveness, and some old small-scale long-term shutdown facilities have been phased out. The centralized operation of large-scale PTA plants has promoted the survival of the fittest in the industry, and competition will become increasingly fierce.

 

It is expected that the PTA production capacity will increase by 8.7 million tons in 2025, with a capacity growth rate of 9.9%, and the pressure of growth will be greater than in 2024.

 

In terms of production, the domestic PTA production in 2024 was 71.8 million tons, an increase of 7.58 million tons compared to 2023, with a production growth rate of 11.8%, higher than the capacity growth rate, mainly due to the improved utilization rate of PTA production capacity in 2024. Thanks to the high downstream polyester production, the annual industry average operating rate of PTA is around 82%. The equipment that will be put into operation at the end of 2024 will release production from early next year, and it is expected that the pressure of supply increment will continue to increase in 2025.

 

PTA inventory statistics in recent years

 

From the inventory perspective, PTA inventory in 2024 is significantly higher than in recent years. During the downstream polyester off-season in the first quarter, PTA continued to accumulate inventory, and the maintenance season in the second quarter eased the pressure of accumulated inventory. However, with the restart of the plant and the sluggish polyester peak season, PTA has returned to the accumulation stage. It is expected that by 2025, due to the pressure of PTA production and high operating rates, the pattern of accumulated inventory is likely to be maintained.

 

Gamma-PGA (gamma polyglutamic acid)

PTA exports will perform well in 2024, with an estimated annual export of around 4.5 million tons, a year-on-year increase of approximately 1 million tons. Mainly due to the growth of exports in Southeast Asia and the Middle East, such as India’s temporary relaxation of BIS certification control in the third quarter of 2024 due to PTA shortage, the export volume surged in July and September, contributing approximately 200000 tons. At present, China’s exports to Southeast Asia and the Middle East are still increasing to a certain extent. However, Türkiye and India have plans to put devices into production in 2025, and the export volume is expected to decline.

 

In terms of cost, in 2024, under the influence of geopolitical, macro, and supply and demand fundamentals, international crude oil prices have emerged from a trend of rising and falling, gradually fluctuating and narrowing. Oil prices have gradually returned to fundamentals, with Brent crude oil falling by 3.58% and WIT crude oil falling by 1.09% throughout the year. The supply-demand balance in 2025 will transition from a tight equilibrium state to a balanced state, mainly based on the current production capacity, combined with moderate growth in future US crude oil supply, and the absence of more intense geopolitical conflicts, taking into account the risk premium. Therefore, the upward range of oil prices is suppressed, and major institutions are relatively pessimistic and conservative about oil prices in 2025.

 

In 2024, the overall PX price showed a downward trend of “sideways, sharp decline, and oscillation”. As of the end of the year, the average price of PX factories in China was 7108 yuan/ton, a decrease of 17.35% from the beginning of the year. The cost support provided by the rise in crude oil prices in the first half of the year, as well as the consolidation of the market under the game of supply and demand contradictions. Subsequently, the collapse of cost support caused by the heavy decline in crude oil and the sluggish demand for oil blending intensified the supply-demand contradiction by switching to aromatics production, resulting in a significant weakening of PX prices. In the fourth quarter, due to the start of annual contract negotiations, there was a strong sense of caution in the market, resulting in slight price fluctuations and consolidation.

 

Starting from the second half of 2023, PX will enter a production vacuum period, and there will be no new production capacity added in 2024. However, due to the higher growth rate of downstream PTA demand for PX in China, the industry’s annual production capacity rate has increased to a relatively high level of 86%. The growth rate of PX production capacity in 2025 is still relatively low. There is only one set of equipment in China with a total production capacity of 3 million tons. After production, the total domestic production capacity will reach 46.67 million tons per year, with a production capacity growth rate of 6.9%. However, due to the lack of approval for this equipment, there is still significant uncertainty in the production time. In terms of supply, considering the current low profit pattern of the industry and the regular maintenance losses within the year, the annual supply increment is very limited. At the same time, multiple downstream PTA units are expected to be put into operation in the first half of the year, so the PX supply and demand pattern will continue to improve in 2025.

 

Downstream polyester products follow the fluctuation of raw material prices, showing a trend of first rising and then falling in 2024. Among them, polyester staple fiber (1.4D * 38mm) fell by 5.13%, polyester DTY (150D/48F low elasticity) fell by 6.87%, polyester POY (150D/48F) fell by 8.39%, and polyester FDY (150D/96F) fell by 9.86%.

 

In 2024, a total of 5.55 million tons of polyester production capacity will be added (excluding obsolete production capacity), and the total production capacity will reach 85.39 million tons by the end of the year, with a production capacity growth rate of 7.7%, which is slower than in 2023. Looking at 2025, the polyester industry will continue to have new production capacity entering, with a planned production of 5.14 million tons. It is expected that the polyester production capacity will reach around 90.53 million tons by the end of 2025, with a capacity growth rate of 6%. Compared to 2024, the overall growth rate will slow down, and the actual production capacity will be lower than the planned capacity. Therefore, the actual growth rate remains to be observed.

 

From a product perspective, the planned production of polyester filament is 1.75 million tons, and the total production capacity is expected to reach 54.33 million tons by 2025, with a capacity growth rate of 3.3%. The planned production of polyester staple fiber is 100000 tons, and the total production capacity is expected to reach 9.605 million tons by 2025, with a capacity growth rate of 1%. The planned production of polyester bottle flakes is 2.6 million tons, and the total production capacity is expected to reach 22.63 million tons by 2024, with a capacity growth rate of 12.9%. The remaining newly added production capacity is polyester film.

 

In 2024, the overall production capacity of the polyester production process is relatively large, and the output growth rate is still high. The capacity utilization rate of the polyester industry for the whole year is around 86%, which is at a relatively high level in recent years. In 2025, the growth rate of production capacity for polyester filament and staple fibers will still be relatively low, which can maintain a high level of operation. However, there may be a risk of temporary load reduction due to excessive inventory. Due to the delay in the production of multiple units from 2024 to 2025, the overall production pressure of Huanpian is still high. Coupled with low profits and high inventory, the expected production pressure has decreased.

 

In recent years, with the cost advantage of raw materials in China’s production and the partial relocation of the industrial chain in the terminal weaving process, there has been a supply gap in external weaving raw materials, resulting in a remarkable growth rate of polyester exports compared to domestic demand. From January to October 2024, polyester exports amounted to 10.42 million tons, a year-on-year increase of 13.4%. The main products exported are polyester filament, staple fiber, and bottle flakes. Among them, the cumulative export volume of bottle flakes and staple fiber will increase by more than 20% in 2024, maintaining a good growth momentum. However, the export volume of polyester filament is expected to decline by 4.5% year-on-year, mainly due to the significant increase in exports caused by early stocking under the Indian BIS certification in 2023. The trade friction may further escalate in 2025, and companies need to consider how to deal with the uncertain factors of the export situation.

 

From the perspective of the weaving process, taking into account the negative factors before the Spring Festival in 2024, the average operating rate may be around 65%, which is comparable to 2023 as a whole. From a seasonal perspective, the operating rate is relatively high from March to June. In summer, due to the influence of off-season and temperature, the operating rate decreases. After September, it enters a seasonal improvement stage, and in October, the operating rate rises to the highest point of the year. In November, it gradually enters the off-season load.

 

In terms of textile terminals, the Ministry of Industry and Information Technology announced that from January to November 2024, the industrial added value of textile enterprises above designated size increased by 4.4% year-on-year, with operating revenue of 445.205 billion yuan, a year-on-year increase of 4.2%; The total profit was 158.57 billion yuan, a year-on-year increase of 9.0%. The production of yarn, fabric, and synthetic fiber in textile enterprises above designated size increased by 0.3%, 1.0%, and 8.7% respectively year-on-year.

 

According to data from the National Bureau of Statistics, from January to November 2024, the retail sales of clothing, shoes, hats, and needle textiles in China reached 1307.3 billion yuan, a year-on-year increase of 0.4%.

 

According to the General Administration of Customs, from January to November 2024, China’s textile and clothing exports totaled 273.06 billion US dollars, a year-on-year increase of 2%. Among them, textile exports were 128.84 billion US dollars, a year-on-year increase of 4.6%, and clothing exports were 144.22 billion US dollars, a year-on-year decrease of 0.2%. The consumer market continues to heat up, with good growth in retail sales and an overall positive export situation. We need to pay attention to changes in domestic and international policies in 2025.

 

Business analysts predict that PTA prices will generally exhibit a “inverted V” trend in 2025. The pressure of self supply will continue throughout the year, becoming a resistance to the rise in PTA prices. In the first half of the year, geopolitical tensions persisted, and the Federal Reserve continued to cut interest rates. There were expectations of an increase in international crude oil prices, supported by favorable PTA costs. And with the boost of the peak demand season, PTA prices have fluctuated and risen. In the second half of the year, as PTA new production capacity gradually releases excess supply, the supply-demand contradiction will further highlight, and PTA prices will fluctuate and fall.

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Price trend

 

According to the bulk ranking data from Shengyi Society, the domestic PC market was consolidating and operating in early January, with limited changes in spot prices for most brands. As of January 7th, the mixed benchmark price of Business Society PC is around 16500 yuan/ton, with a price increase or decrease of -0.10% compared to January 1st.

 

Cause analysis

 

Supply side: In early January, the load changes of domestic PC aggregation enterprises were very limited, and the industry average operating rate was slightly adjusted from 78% at the end of December to 77.5%. The average weekly production remains at a super high level of over 60000 tons, and the on-site supply is still abundant, with no change in the supply-demand mismatch pattern. The high inventory has led to cautious pricing by manufacturers, while the market supply side has provided average support for PC prices.

 

In terms of raw materials: From the above chart, it can be seen that after the significant recovery of bisphenol A in December, the bulls have gradually exhausted recently, and downstream demand is running steadily. The upward movement of bisphenol A prices is hindered, and after falling back, it runs sideways. The support for PC cost has weakened.

 

On the demand side: The PC consumption pattern has been weak for a long time, and the overall trend continues to be weak at the end of last year. Previously, some export orders were placed in advance in the market, and currently the overall logic of weak rigid demand procurement continues, with industry players showing a wait-and-see attitude. As the end of the lunar calendar approaches, downstream factories are taking over goods to maintain production, and buyers are resistant to high priced goods. Therefore, purchasing and chasing price increases should be cautious. The slow circulation of goods in the market has limited changes, and the demand side has poor support for PC spot prices.

 

Future forecast

 

At the beginning of January, the PC market remained stable with small fluctuations. The upstream bisphenol A market is currently stagnant and consolidating, maintaining support for PC costs. The load of domestic PC aggregation plants has basically leveled off, and the supply level remains at a high level. The high level of inventory in the industry has limited changes, 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 high raw material prices in the early stage have led to a high cost value of PC currently. However, due to the continued loose supply of goods in the market, the market may continue to consolidate weakly.

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Last week (December 27, 2024- January 5, 2025), the adhesive short fiber market maintained stable operation. The price trend of upstream raw material market has slightly declined, the cost side support has weakened, the supply in the market has increased narrowly, the purchasing enthusiasm of downstream factories is not high, and they are holding onto the demand for replenishment in multiple aspects. Operators mainly execute the previous contracts, and the price of adhesive short fiber market has been consolidating horizontally.

 

Gamma-PGA (gamma polyglutamic acid)

According to the Commodity Market Analysis System of Shengyi Society, as of January 5th, the average market price of viscose staple fiber was 13820 yuan/ton, which was the same as the same period last week.

 

Cost of raw materials: Last week (December 27, 2024- January 5, 2025), there was little change in the market price of raw material dissolution slurry, while the prices of auxiliary liquid alkali and sulfuric acid markets fell to varying degrees. The center of gravity of raw material market prices fell, and the average production cost of adhesive short fibers significantly decreased.

 

Supply inventory: Last week (December 27, 2024- January 5, 2025). The operating rate of the adhesive short fiber industry remains at around 86.3%, with a slight increase in production compared to last week. During the week, the pre maintenance equipment for adhesive short fibers in Shandong region has resumed full load operation, and the on-site supply has increased; In addition, the early orders on site are coming to an end, and the enthusiasm for replenishment in downstream markets is not high, resulting in a slowdown in the overall flow of goods and a significant increase in inventory levels.

 

On the demand side: The downstream cotton yarn market has a strong wait-and-see atmosphere, with prices remaining stagnant and consolidating. Although we are at a new stage of signing contracts, the demand in the end market is weak, downstream yarn companies have insufficient orders, yarn manufacturers are holding onto essential orders in multiple dimensions, and purchasing enthusiasm is difficult to increase. It is difficult to find favorable support from the demand side.

 

Market forecast:

 

The main material dissolution slurry market and auxiliary material liquid alkali market may be in consolidation operation in the later stage, and there is a downward expectation in the sulfuric acid market; Supply and demand side: The adhesive short fiber market is expected to maintain stable operation, with high on-site supply and increased inventory levels. In the short term, the performance of the adhesive short fiber supply side is still acceptable; The demand in the terminal market is weak, coupled with the approaching Spring Festival holiday, downstream yarn factories or multiple parties may hold onto the demand side and sign contracts, making it difficult for the demand side to have favorable support. Overall, the main raw material market is expected to operate steadily, with limited support on the cost side. Downstream cotton yarn factories are signing orders as needed, making it difficult for the demand side to improve significantly. With mixed news on the market, analysts from Shengyi Society predict that the focus of the domestic viscose staple fiber market will shift downward in the short term, with a decline expected to be between 100-300 yuan/ton.

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1、 Trend analysis

 

Gamma-PGA (gamma polyglutamic acid)

Copper prices have slightly decreased this week. As of this weekend, the spot copper quotation is 73270 yuan/ton, a decrease of 1.25% from 74196.67 yuan/ton at the beginning of the week and a year-on-year increase of 6.29%.

 

According to the weekly rise and fall chart of Shengyi Society, in the past three months, copper prices have fallen by 9 and risen by 3, with a slight decrease this week.

 

LME copper inventory

 

According to data released by the London Metal Exchange (LME). LME copper inventory slightly decreased, with 271350 tons of LME copper inventory as of the weekend, down 0.02% from the beginning of the week.

 

Macroscopically, data released by the US Department of Labor on Thursday evening showed that the number of initial jobless claims in the US fell to an 8-month low last week, and the number of renewed jobless claims also dropped to a 3-month low of 1.844 million. This data reflects the relatively small scale of layoffs in the US labor market, demonstrating surprising resilience. As a result, the US dollar exchange rate has significantly strengthened to a new two-year high, putting significant pressure on industrial metals as a whole, as the strengthening of the US dollar means that metals denominated in US dollars are more expensive for buyers holding other currencies.

 

Supply side: The tight situation on the raw material side has not changed, with copper concentrate processing fees remaining low and crude copper processing fees decreasing. The completion of maintenance in domestic smelters and the demand for production recovery have brought incremental growth to electrolytic copper.

 

On the demand side: The Chinese New Year holiday is approaching in the domestic market, gradually entering the off-season of consumption, and downstream consumption is gradually weakening. The seasonal off-season has led to a buildup of inventory in the domestic market.

 

In summary, there is a lack of macro news in overseas markets, and although favorable domestic policies have curbed the decline in copper prices, weak post holiday consumption expectations have put pressure on copper prices. Therefore, copper prices still face downward pressure in the short term.

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According to the Commodity Market Analysis System of Shengyi Society, the PP market in December was mainly sorted out, and the price changes of most brand products were relatively narrow. As of December 31st, the mainstream offer price for wire drawing by domestic producers and traders is around 7646.67 yuan/ton, which has increased or decreased by 0.33% compared to the price level at the beginning of November.

 

Gamma-PGA (gamma polyglutamic acid)

Price trend

 

In terms of raw materials:

 

In terms of international crude oil, the supply risk has increased due to the geopolitical situation in Syria. At the same time, the positive impact of the OPEC+production reduction plan delay is still present, coupled with the expectation of increased demand in Asia, international oil prices fluctuated and rose in the first half of December. At the end of the month, the US dollar strengthened and consumption contracted, which loosened the upstream support for PP in the far end. In terms of propylene, the domestic supply in North China was initially tight and then eased, and the favorable supply weakened, causing prices to rise first and then fall. Propane follows the trend of crude oil and runs steadily, while PDH remains stable due to its influence. Overall, the PP raw material market in December showed mixed ups and downs, and the cost side support was still strong.

 

Supply side:

 

In December, there was a mutual occurrence of maintenance and production in domestic PP enterprises, and the overall load level showed a slow upward trend. Jincheng Petrochemical, Dalian Hengli and other enterprises have newly put into operation facilities, but some of them have stopped again after being put into operation. At the end of the month, maintenance tasks for enterprises such as Zhongyue Haitian Petrochemical have gradually returned. Overall, the industry’s overall load has decreased from 68% in the first half of the month to around 78%. The domestic PP shipment volume has increased, and the average weekly production at the end of the month has rebounded to around 720000 tons. Although some newly put into operation facilities are unstable, the supply is still abundant. Overall, the supply side provides average support for PP spot prices.

 

In terms of demand:

 

The demand side of PP in December is biased 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 slow release of some pre holiday replenishment demand has to some extent boosted consumption. Overall, the demand side tends to have weak fluctuations in most aspects.

 

Future forecast

 

The domestic PP market prices remained stable in December. Fundamentally speaking, the overall performance of upstream raw materials in supporting PP is still acceptable. The supply within the range is relatively high. According to consumer feedback, businesses are cautious about future terminal consumption and tend to focus on restocking for essential needs. In the short term, it is expected that PP prices will remain stagnant.

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