Plastic destocking still needs to increase

As forecasted by market participants last week, plastic prices are high on the list. After the gradual digestion of the previous bullish factors, the risks in the plastics market are slowly accumulating, and the momentum for the market to continue to rise has been gradually suppressed. As of yesterday's close, the LLDPE1505 contract was reported at 9,965 yuan/ton, which fell by nearly 400 points from last week's high. At the same time, the spot price also fell by RMB 250/t from last week's high.

It is worth noting that the sudden change of face in the plastics market has not touched market sentiment. This change seems to be in the market sense for most industry professionals.

It is understood that the petrochemical enterprises' stock prices have begun to rebound after the continuous price increase, and the current inventory of traders and downstream manufacturers has also increased. Incremental inventory and production rebound have undoubtedly become the vane that affects the current trend of the plastic market.

"At present, weak market transactions, we must pay attention to changes in total inventory, because the inventory is after all the result of supply and demand, so this data can best reflect the market's future expectations." Zhuo Creative Information Technology Shen Yi told the ** Daily reporter. Zhuo Chuang information statistics show that as of April 10, Sinopec LLDPE's inventory of 59,000 tons, compared with April 3 rose 18,000 tons, compared with the previous period, the current inventory has begun to accumulate.

According to the reporter of the ** Daily, the reason why plastic stocks have accumulated in the near future is that due to the fact that the market has risen too fast and exceeds the expectations of downstream factories, the downstream market is more resistant; on the Other hand, the demand capacity of factories is now falling, leading to traders. The inventory keeps increasing.

According to Xie Long, an analyst at Guotai Junan, the accumulation of plastics inventory also lies in the difference in supply and demand between upstream and downstream in terms of time. “In March, the upstream overhaul increased while the downstream demand coincided with the peak season, resulting in tight supply. After April, the downstream entered the demand low season, coupled with factors such as the shortage of purchase intentions due to stocking and high spot prices, and the accumulation of inventory. ”

At present, the downstream agricultural film season has passed, plus a certain reserve of raw materials, the market demand is limited. “Now the downstream factories are not willing to accept the goods and are waiting to see it.” Shen Yi frankly stated that after April 15th, orders for plastic sheeting will become less and less, and there is basically no big order. At the same time, packaging orders are not optimistic. "According to the current situation, it is estimated that it can be supported until the end of the month, but the number in May will be less and less."

In addition to the end of the peak season for demand, high prices are also a major cause of the current downstream market conflict. "The price of 10,000 yuan/ton or more is a Kaner to the downstream. The current market price of 10,300 to 10,400 yuan/ton has clearly exceeded the market's psychological expectations." Some market participants bluntly stated that due to the rise in upstream costs, and the downstream The spread of the agricultural film is getting smaller and smaller, and the profits of the downstream manufacturers have been squeezed so that the enthusiasm of getting goods from the downstream is not high.

According to the law, from April to May of last year, it was the destocking phase of the market. Compared with the same period of previous years, despite the phenomenon of short-term inventory accumulation this year, due to the fact that the maintenance of the equipment from April to May is still large, there is no new capacity to put in, and the downstream After having consumed the existing inventory, they had to enter the procurement stage again, so the plastics market is still in the stage of destocking.

According to Pan Zeng-en, an analyst at Xingye, “LLDPE futures prices are expected to remain high and prevail during the LLDPE 1505 contract settlement. After May, with the gradual restart of the device, the supply will increase the accumulation of superimposed stocks. Or will drive the market weaker."