In late November, the domestic ABS market was in a state of consolidation and operation, with narrow fluctuations in spot prices for various grades. According to the Commodity Market Analysis System of Shengyi Society, as of November 27th, the average price of ABS sample products was 11487.5 yuan/ton, which was basically the same as the beginning of the month.
| Gamma-PGA (gamma polyglutamic acid) |
Fundamental analysis
Supply level: In late November, the domestic ABS industry’s operating rate stopped its upward trend, and the load level declined slightly. Recently, both Jilin Petrochemical and Zhejiang Petrochemical have plans for equipment maintenance, resulting in a nearly 2% to 71% reduction in industry operating rates. Although the average weekly production in China is still above 120000 tons, the overall pattern of abundant supply remains unchanged, but there has been some digestion in terms of inventory. The position has dropped by more than 10000 tons to around 178000 tons. Overall, the supply side showed a slight increase in support for ABS spot prices in late November.
Cost factor: Recently, the trend of ABS upstream three materials has mainly been consolidation operation, and the overall support for ABS cost side is average. Among them, the acrylonitrile market saw a significant increase in the early stage. The favorable news of acrylonitrile factory shutdown and maintenance in East China has been released, and market prices have remained high and sideways under tight supply. However, the difficulty of downward transmission of prices has limited the short-term upward potential of the acrylonitrile market.
Recently, the butadiene market has fluctuated slightly and the downward trend has slowed down slightly. The overall market supply is still relatively loose, while the main downstream synthetic rubber enterprises have a heavy wait-and-see attitude, resulting in weak demand. However, with the recent decline in prices, some purchases have been stimulated to enter the market, forming a bottom. Overall, the market will continue to operate weakly in the short term.
Recently, the styrene market has been trending towards a more positive direction. The prices of remote upstream and direct raw materials have shown strong performance, while the cost support of styrene is still acceptable. The operating rate of domestic industries remains low, and the tight supply situation continues. In addition, the inventory positions at each port are generally average, and there is an expectation of a decrease in imported goods to the port. At present, the bullish trend dominates the market, and styrene may still strengthen in the short term.
In terms of demand, the main terminal demand for ABS has increased in late November, and the “Double Eleven” shopping festival and subsidy policies have stimulated the sales of some terminal products. Due to the concerns of home appliance exporters about the remote market, some export demand has been pushed forward, the overall load position of factories has rebounded, terminal stocking willingness has strengthened, and procurement operations have increased synchronously. Merchants take advantage of the situation to digest inventory, try to raise prices through quotations, and increase the activity of source circulation. Overall, the demand side has slightly improved its market support.
Future forecast
In late November, the domestic ABS market mainly experienced consolidation. Upstream three materials showed mixed ups and downs, providing average comprehensive support for ABS cost side. The load of ABS polymerization plant has stopped rising and rebounded, and finished product inventory has been digested at a high level. The demand side is becoming stronger, and the market is stable and strong under the guidance of consumption. However, the supply contraction within the market is limited, and it is expected that the ABS market will explore a narrow range to find a market equilibrium point in the future. Price changes may not be significant in the short term.
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