I. price trend

According to the data monitoring of the business agency, zinc prices were adjusted in December, and the zinc market recovered. As of December 13, the spot price of zinc was 18726.67 yuan / ton, up 1.41% from 18466.67 yuan / ton on December 1, down 13.68% year on year.

II. Market trend analysis

LME futures market zinc price fell in shock

It can be seen from the spot zinc price chart of LME that zinc price has fallen sharply in recent years, and the international market is short of zinc price, which has affected the domestic zinc market. Since December, the price of zinc in LME market has been fluctuating and stable, and the negative effect on domestic zinc price has weakened, but the overall recovery of domestic zinc market is still dragged down.

Zinc price in Shanghai futures market rose in December

From the zinc price of Shanghai futures market, it can be seen that since December, the domestic futures market has recovered and the futures zinc price has risen in shock, which is good for the spot market.

III. future prospects

Bai Jiaxin, an analyst with business club, thinks that the main reason for the rise of zinc price in domestic futures market is that China’s economy shows signs of recovery in November. In the spot market, with the recovery of the economy, the demand for zinc has increased, which is good for zinc price. However, the rise of zinc price in the spot market is still struggling. Under the condition of the recovery of demand and the temporary stability of supply, the performance of the spot zinc price is not ideal. The reason is that the price of zinc in China is largely affected by the price of zinc in the international market, while the price of zinc in the international market continues to fall, which has a great negative impact on the domestic zinc market. Generally speaking, the recovery of domestic macro-economic environment is bound to lead to the rise of zinc price, but the fall of international zinc price will drag down the rise of zinc price. The fall of international zinc price is not enough to change the rise and fall of China’s zinc market. The spot zinc price is expected to rise in the future, but the increase is limited due to the impact of international zinc price.

I. price trend of acrylic acid:

According to a large number of data on the list of business agencies, the acrylic acid market this week rose steadily. As of December 13, the average price of acrylic acid was 8100 yuan / ton, up 1.25% compared with the beginning of the week. In a three-month cycle, it rose 0.41% year-on-year. On the 13th, the main price of acrylic acid in China was 7200-9300 yuan / ton.

II. Market analysis:

Product: acrylic acid market is stable and rising this week. The starting load of acrylic acid plant has not been recovered, the spot supply is limited, the downstream demand is light, the purchase is just needed, and the market participation is cautious. As of the 13th, the price of acrylic acid of Shandong Yukang Chemical Co., Ltd. has been temporarily stable, with 7200 yuan / ton of common acid and 7800 yuan / ton of refined acid. The specific transaction price is discussed in a single and practical way. The price of acrylic acid of Wanhua Chemical Petrochemical Co., Ltd. has remained stable, with main supply contracts and stable customers. At present, the price of acrylic acid is 7700 yuan / ton.

Industry chain: this week (12.9-12.13), the market in Shandong area of propylene in the upper reaches rose slightly, or 0.11%. At present, the inventory of downstream enterprises is low, the purchasing mentality is slightly improved, the downward trend of propylene price begins to stop, and the crude oil market is relatively ideal. It is expected that the propylene market price may recover in recent days.

Industry: according to the price monitoring of the business agency, in the 49th week of 2019 (12.9-12.13), there are 24 kinds of commodities rising month on month in the chemical industry sector, including 4 kinds of commodities rising by more than 5%, accounting for 4.7% of the number of commodities monitored in the sector; the top three commodities are glycol (17.59%), crude benzene (7.07%) and aniline (6.81%). There are 28 commodities with a decline of more than 5% on a month on month basis, accounting for 1.2% of the number of commodities monitored in the sector; the top three products with a decline are hydrochloric acid (- 6.41%), chloroform (- 4.55%), and bisphenol A (- 3.62%). This week’s average was 0.07%.

3. Future forecast:

Acrylic analysts of the business club believe that the price of upstream propylene is rising slightly, which has limited support for acrylic cost. The spot supply of acrylic acid is limited, but the demand in the downstream market is weak. It is expected that the acrylic acid market will maintain stable operation in the short term, and the negotiation is relatively stale.

I. price trend of sodium pyrosulfite in China

According to the monitoring of the business association, the domestic sodium pyrosulfite continues to run at the bottom this week. The average price of industrial grade sodium pyrosulfite at the beginning of the week is 1760.00 yuan / ton, and the average price at the end of the week is 1760.00 yuan / ton, up or down 0.

II. Market analysis

Products: in December, the domestic sodium metabisulfite price continued to be weak at the bottom. This week, the market performance of sodium metabisulfite is still tepid. The market price of industrial grade sodium metabisulfite is in the range of 1680-1900 yuan / ton, and most of the prices are concentrated around 1800 yuan / ton. Enterprises mainly complete orders from old customers, with limited new orders. The market transaction atmosphere is general, and fast in and fast out is the main support. (the above prices refer to the foreign quotations of domestic mainstream enterprises, some of which are temporarily excluded from the scope. The prices are for reference only and have nothing to do with the final pricing of the manufacturer. For details, please contact each manufacturer for consultation).

Industrial chain: as of December 13, the upstream soda ash fell by 4.1% in the month, and the sulfur fell by 5.5% in the month. The raw material cost continued to be weak and adjusted. The downstream trade subjects had a strong wait-and-see attitude, and the cost and demand continued to be weak and suppressed. The domestic sodium metabisulfite market price recovered and came under pressure.

III. future forecast

Analysts of the business club believe that raw material cost continues to be weak, and the main body of trade is cautious in purchasing and selling. In the short term, domestic sodium metabisulfite will continue to follow the raw material price to explore the bottom.

In the blink of an eye, there is not much left in 2019. Looking back on this year’s market trend of diammonium, it can be said that the market trend of diammonium is high and low. Take Heilongjiang as an example, in the same period last year, 64% of the price of diammonium arriving in Heilongjiang was 3000 yuan (ton price, the same below), while the price of 64% of high-end diammonium arriving in advance is only 2500 yuan, a drop of about 500 yuan. In the winter storage market, diammonium enterprises and downstream distributors are caught in a tug of war, so why does the diammonium market become this year?

First of all, the fertilizer market environment is poor. Although the settlement price of diammonium is relatively high this spring, the sales volume in Northeast China is relatively poor, and there are many leftovers. The downstream dealers make less profits when selling diammonium, and some dealers even lose money. In addition, the urea price fluctuates frequently this year, the start-up of compound fertilizer enterprises is slow, the overall environment of fertilizer market is slow to warm up, the downstream dealers’ confidence in stock is naturally insufficient, and the market naturally presents a stalemate state.

Secondly, the support of low operating cost of raw material price is weakened. At present, the sulfur port stock is at a high level of more than 2.6 million tons, and the highest port stock in previous years is only about 1.7 million tons. The granular sulfur in the Yangtze River port has been as low as about 500 yuan, but there are still sulfur coming to the port in the near future. In addition, the purchase of ammonium phosphate enterprises is carried out on a quarterly basis, so the sulfur price is difficult to rise in the short term. The lack of cost support makes the firm price not enough. In order to relieve their own pressure, individual factories frequently offer low prices and the market quotation is chaotic.

Finally, exports are weak. The biggest difference between this year’s diammonium market and last year’s is the weak export. Last year, the price of diammonium was high in the world, India and Pakistan had better demand, 64% of diammonium was more than US $400 FOB, and some enterprises in Hubei even gave up the domestic autumn market with low price in order to seize the international market, which made the social inventory relatively low when the winter storage started last year, which provided a precondition for the start of high winter storage in the later period. However, the international market of diammonium is in a mess this year, and the international price is falling all the way. At present, the FOB price of 64% of diammonium in China has been as low as US $295-300. According to the customs data, China exported 5.3419 million tons of diammonium from January to October, which is nearly 90000 tons less than the 6.21 million tons of the same period last year. This price pattern makes most domestic enterprises lack of export enthusiasm, and only a few large factories slightly walk away. Most factories began to focus on the domestic market, the supply pressure increased, coupled with more social inventory this year, the price of winter storage is naturally not high, and downstream dealers are reluctant to purchase in order to avoid risks, so the market is now in a stalemate state.

To sum up, the price of diammonium in winter this year has dropped by about 500 yuan compared with the same period last year. The downstream market is dominated by cautious psychology, and most dealers dare not take the goods rashly. The overall environment of the fertilizer market is poor, the supply continues to be excessive, the raw material price is low and consolidated, the international market demand is weak, many negative factors dominate the market of diammonium in 2019, which is so bleak, and the downstream dealers mostly adopt the minimum guarantee policy to alleviate the operation pressure.

The listing price of soda ash futures is slightly lower, and the spot price is close to the production cost of the factory, and the margin of safety for long-term trading is higher. However, in the context of oversupply and high inventory, there is limited space for rising, so investors can trade short-term, enter the market with light positions, and make long-term bargain.

On December 6, soda ash futures landed at Zhengshang exchange. Judging from the situation in recent trading days, the market is active in trading, with enthusiasm for capital participation, and the contract formulation is in line with the actual spot trading. On December 10, sa2005 and sa2009, the intraday trading limit directly rose, and on December 11, it continued to rise, but there was no significant change in the spot market. In the case of relatively weak fundamentals, the rise height is expected to be limited.

The current situation of oversupply is hard to change

In 2019, the capacity of soda ash will be expanded for a long time again, while the operating rate will remain high, but the demand will not be synchronized, and the market supply will exceed the demand obviously. In 2014, the capacity of soda ash reached a record high of 31.35 million tons. From 2015 to 2016, the capacity was continuously de capacity. By 2017, due to the improvement of demand, the capacity was expanded again. It is expected that the capacity growth rate in 2019 will be as high as 8.44%. In the same period, the capacity growth rate of main downstream flat glass of soda ash was only 5.2%, significantly lower than that of soda ash.

From February to November 2019, the operating rate of soda ash industry was 87.06%, and only 81.56% in the same period of 2018, with a year-on-year growth of 5.5 percentage points. In December, the operation rate of soda ash industry will remain high, and local maintenance will not affect the overall operation. In addition, from January to October, the total export of soda ash reached 1.179 million tons, up 0.7% year on year, and the export was relatively stable. The production capacity has increased substantially, the operating rate has remained high, while the export and consumption are relatively stable, and the price of soda ash is under pressure.

De stocking time node may be advanced

The fourth quarter is the peak season of soda ash consumption. Generally, the factory will respond with high operating rate and high output. After the Spring Festival, when the price falls, the factory will start to repair and the inventory will decline. Data shows that as of December 5, soda ash inventory was 774100 tons, an increase of 30700 tons on a month on month basis, compared with 192200 tons in the same period last year, an increase of 5819000 tons on a year-on-year basis.

At present, the soda ash inventory is still in the rising channel, and is far higher than the same period last year. In the context of high inventory and falling prices, glass enterprises delayed procurement, and traders carefully prepared goods, resulting in accelerated inventory accumulation. In the later stage, the soda market will enter the de stocking stage only when the maintenance of soda plants is increased and the winter storage and replenishment warehouse of glass enterprises is opened. However, in the fourth quarter of 2019, it is different from the previous years. The price of soda ash fell earlier, the time of factory overhaul may be earlier, and the time of soda ash de stocking will also be earlier.

Loss on production in high cost factories

With the decrease of spot price, the profit of soda ash plant shrinks, and some high cost plants even lose money. It is estimated that at present, the profits of ammonia alkali and combined alkali plants are within 100 yuan, which is at a low level since 2017. Generally, low profit lasts for a period of time, which will stimulate the factory to overhaul ahead of time or adjust the operating rate level to achieve the supply and demand rebalancing. Among them, the production of the 8000 T / D units in Shandong Haihua was limited since December 2 due to the impact of environmental protection, and the daily production was reduced by 1500 tons; the 900000 T / a units in Sichuan and hopang were overhauled since December 4; the units in Xindu, Hubei Province are scheduled to be overhauled in the past two days; the units in Shuanghuan, Hubei Province are scheduled to be overhauled at the end of the month. The increase of parking and maintenance devices is conducive to alleviating the imbalance between supply and demand in the soda ash market and stabilizing and rebounding the spot price.

Forecast for future market

Since October, the spot price of soda ash has continued to fall. At present, it is close to the bottom line of manufacturers, and there is little room for further price reduction. Considering winter storage demand and year-end transportation pressure, soda ash price is expected to stabilize and rebound. However, the overall oversupply of the market results in a weak upward drive. Based on the above judgment, it can be expected that the price of soda ash futures will continue to rebound in the short term, but time and space are limited, so investors can try to bargain long.

Affected by the tight supply, PVC prices rose sharply. At present, PVC load cannot be greatly increased in a short period of time, but due to the influence of weak demand, the price may drop slightly. However, in the medium and long term, the tight supply pattern is difficult to change, and PVC is expected to continue to rise.

Supply elasticity is too small

At the end of 2015, the government put forward the supply side structural reform plan of “three removal and one compensation”, and began to implement the elimination of backward production capacity by means of environmental inspection in 2016. In the supply side structural reform, PVC is greatly affected. Some PVC production enterprises are forced to stop production because they still use high mercury catalyst, and domestic PCV supply is gradually declining. At the same time, Western European countries are also phasing out PVC devices with mercury containing process, and the supply gap can only be completed by importing PVC from China, which makes China gradually change from a net importer of PVC to an import-export balance or even a net exporter in recent years. The supply is in a tight balance state as a whole, and the supply elasticity is smaller than other chemicals.

In April, the 400000 ton plant in Dongxing, Inner Mongolia has been shut down due to failure. So far, Yangmei Xiyang, Yunnan nanphosphorus and other plants have also been overhauled (at present, they are still not back to production). The domestic PVC starting load has dropped to a low level (about 65%) in recent years, and the market has been forced to consume inventory to meet the supply gap. At the end of October, the Inner Mongolia triple unit failed to shut down, and the domestic PVC supply further declined. Recently, affected by environmental protection, the starting load of 1.3 million tons of production capacity of Xinjiang Tianye dropped by 1 / 3, which is expected to last for one month.

Fall into the out of stock phase

Due to the fact that the growth rate of real estate construction area this year remains at a high level of about 9%, and the warm winter weather in the north makes some projects shut down later than in previous years, resulting in the PVC slack season and stronger demand performance than expected. In this case, the supply of domestic PVC is in short supply, the social inventory continues to decline, and the price correspondingly rises. As of November 29, the social inventory of PVC in East China was 59300 tons, down 41700 tons from the same period last year, down 41.29%; the social inventory of PVC in South China was 8000 tons, down 76.47% from the same period last year. Social inventory continued to decline, especially in South China, which was at a low historical level, causing the market to fall into a phased shortage stage.

High production profit

With the rising price of PVC, the profit of PVC production enterprises by calcium carbide process is at a high level. At present, the profit of PVC production by domestic calcium carbide process is about 1500 yuan / ton, which is a high point in recent years. Under the condition of high profit, the production enthusiasm of enterprises will rise, but most of the domestic devices for parking and maintenance cannot be produced due to device failure or environmental protection and other factors, so even if the production profit is at a high level, the progress of market supply recovery is relatively slow. The author believes that this phenomenon will last at least until after the Spring Festival, and it is difficult to fundamentally improve the current situation of tight market supply.

However, from the perspective of demand side, although the demand performance of PVC this year exceeded expectations, it is inevitable that demand will drop under the influence of seasonal off-season. At present, the starting load of PVC downstream pipe is 50-70%, and that of profile is 60-80%. The enterprise said that with the demand weakening, the recent order quantity is limited, and the downstream will further reduce the load later, which will continue after the Spring Festival. At the same time, the cable and medical equipment industry, which is not seasonal, has also resisted the high price of raw materials and adopted the strategy of “buy now, use now”. The author believes that although it is difficult for the starting load of enterprises to recover in a short time, it is impossible to further reduce. At the same time, with the seasonal decline of the consumer end, the short-term market short of demand is expected to ease the situation.

Imports are lower than last year

In the long run, the supply of PVC in China is in a tight balance, and the potential market supply is limited. In terms of import, although the PVC anti-dumping duties against the United States, Japan, South Korea and other countries are no longer imposed in China since the fourth quarter, the arbitrage space has been closed for a long time due to the strong foreign market price, which makes the domestic import volume this year lower than that of the same period last year, and it is difficult to make up for the market supply pressure in a short time. In addition, the issuance of special bonds in advance by the government is intended to strengthen the construction of infrastructure, so as to boost the enthusiasm of the market, which makes the demand for PVC still guaranteed in 2020, so it is expected that there is limited downward space for PVC.

To sum up, the main reason for the sharp rise in PVC price in this round is the device failure and the tight supply end caused by the environmental inspection. At present, there is no possibility of further deterioration at the supply side, and there is a decline expectation at the demand side. In this case, PVC will enter the stock accumulation cycle, and the price is expected to callback. However, on the whole, PVC supply is in a tight balance state. Under the background of infrastructure increase in 2020, the pattern of strong price is difficult to change, so it is advisable to adopt the strategy of short term and long term.

I. price trend

According to the monitoring data of business agency, the average ex factory price of light soda ash in East China on November 11 was 1560.00 yuan / ton, down 11.70% month on month. On December 10, the commodity index of light soda ash was 80.00, flat with yesterday, down 32.12% from 117.86 (2017-11-21), the highest point in the cycle, and up 26.68% from 63.15, the lowest point on November 18, 2015. (Note: cycle refers to 2011-09-01 to now)

II. Market analysis

The domestic soda market is weak and stable, and the market is light. At present, the start-up load of soda ash manufacturers is more than 90%, the downstream inventory is sufficient, the demand is limited, the supply pressure of soda ash is obvious, the market confidence is frustrated, the delivery and investment is light, and the enterprise may avoid excessive inventory risk through active maintenance. In December, three alkali plants will be cut or shut down. In the later stage, there are maintenance plans for 1.1 million tons of capacity in Shuanghuan, Hubei Province and 600000 tons of capacity in Xindu chemical industry. Shandong Haihua will continue to cut production. Even if some manufacturers stop production and reduce production, it is still a drop in the bucket in terms of supply, and the operating rate remains high. The inventory of soda plants is still increasing slowly, and the pattern of oversupply is difficult to change in the short term.

On the demand side, the downstream consumption is about to turn into the seasonal off-season, and the upward price of soda ash is lack of power. On the other hand, the fact that the supply of soda ash exceeds the demand has become a reality. The downstream glass factories have sufficient inventory, and the demand and trading are flat. The glass industry production lines have many cold repairs, and the demand side does not support the rise of soda price.

III. future forecast

Analysts of soda ash of business association think that: in the downstream, high profits stimulate the enthusiasm of glass enterprises, and there is an expectation that the demand for heavy soda will improve. Under the pattern of oversupply, soda ash is difficult to take off the downward channel in the short term, but limited by cost and profit, the downward space is limited. It is expected that the market situation of soda ash will be weak and stable. See the downstream market demand specifically.

At the end of the year, the new PX production capacity of Zhejiang Petrochemical Co., Ltd. will arrive as scheduled, the PTA new plant is expected to be put into operation, and the downstream polyester market will enter into seasonal maintenance. In the context of lack of cost support and demand pull, PTA may weaken again.

PX new capacity launch

PX is the direct raw material of PTA, which is highly related to the price of PTA. This year’s massive production increase of PX has reduced PX manufacturers from huge profits to losses. From March to may 2019, the PX plant with an annual output of 4.5 million tons in two phases of Hengli was released successively, which increased the capacity by 31% compared with the end of last year, greatly reducing the domestic dependence on imports. The price difference between PX and naphtha fell to US $280 / ton in mid May, down 55% from US $617 / ton in early February. Although the PX plant maintenance support was provided in the middle of the year, and the PX processing fee slightly increased to the range of $300-350 / T, after the National Day holiday, with the 600000 tons of Sinochem Hongrun and the 1 million tons of new capacity of Hainan refining and Chemical Co., Ltd. gradually put into production, the price difference between PX and naphtha fell again below the cost line of $300 / T.

Recently, the annual production capacity of 4 million tons of PX of Zhejiang Petrochemical Co., Ltd. has been opened and half of it has been put into production recently. If it is put into production smoothly, the remaining capacity will be released soon. But at present, PX production has been in a loss state, and the increase of production capacity will increase the market supply pressure, so it is difficult to support PTA price.

PTA supply and demand contradiction deepened

Since 2019, PTA industry has entered the production increase cycle. Within this year, Sichuan Shengda 1 million tons and xinfengming 2.2 million tons of units have been put into production successfully. Hengli phase IV 2.5 million tons and Xinjiang Zhongtai 1.2 million tons of units will also catch up with the last train at the end of this year and put into production. At that time, PTA capacity growth will reach a high of 15%. The rapid increase of production capacity has greatly reduced the profits of the industry. PTA market has stepped from the prosperity in the first half of the year to the depression in the second half of the year. Recently, the spot processing fee has dropped to a low level below 600 yuan / ton.

At present, in addition to the maintenance plan of Hanbang and Sanfangxiang in Jiangyin, PTA device maintenance has been basically completed within the year, the market starting load is above 92%, and will continue to increase in late December. If two sets of new production capacity are released as scheduled in the near future, it will be gradually mass produced at the beginning of next year, thus aggravating the contradiction between supply and demand in the market.

Seasonal decrease in demand

After the expansion of production capacity in the first two years, the growth rate of polyester market output in 2019 is less than that of PX and PTA links in the upstream, but overall, the annual growth rate is still 6.7%. At the same time, the average operating load of polyester manufacturers is also at a high level of 87.8%. However, under the background of high production, the market prosperity gradually declined. Since the fourth quarter, polyester polyester cash flow has dropped significantly, of which polyester and FDY have been in a loss state for more than two consecutive months.

Due to the holiday of the downstream terminal weaving factory, polyester manufacturers usually conduct centralized maintenance around the Spring Festival. According to the maintenance plan announced so far, the maintenance capacity is expected to be 2.33 million tons in December and 3.36 million tons in January next year. With the end of the winter fabric purchase order, after the middle of December, the texturing and weaving factories will be shut down, and polyester warehouse will be inevitable. Under the background of increasing production in the upstream at the end of the year, polyester manufacturers dare not expect to stock up.

In a word, under the expectation of Zhejiang Petrochemical PX production increase and two new PTA production capacity put into operation, the PTA market supply pressure will increase at the end of the year, meanwhile, the downstream market demand will also weaken during the Spring Festival, and the PTA price may weaken again.

The methanol units overhauled in Shaanxi, Gansu and Inner Mongolia have been fully restarted at the beginning of this week. In addition, the methanol units restarted after the completion of technological transformation in Northern Shaanxi now have considerable supply capacity again. This is also the reason why the price in Northwest China fell this week.

Affected by the positive factors such as the rapid decline of port area inventory, the decrease of inland supply and the improvement of downstream demand, methanol futures have rebounded in the near future, and the spot market has also risen at the same time. Among them, the spot price in East China rose to 1990 yuan / ton, 80 yuan / ton higher than that at the end of last month, and the main futures contract rose to near 2010 yuan / ton in 2001, 80 yuan / ton higher than that at the end of last month.

Steady growth in mainland demand

In the early stage, several sets of methanol units were overhauled in the inland areas, including 6 sets of 4 million tons of units in Shaanxi, Gansu, Shanxi and Inner Mongolia, which resulted in a shortage of supply in the northwest. At the same time, the southwest natural gas methanol plant was overhauled in advance unexpectedly last week, and 3 new 1.6 million tons of methanol units were shut down. The balance of supply and demand in inland areas has been broken rapidly, and the market is in short-term short-term short-term short-term short-term state of supply and demand.

The downstream demand in the mainland is relatively strong. In addition to the stable traditional downstream demand, the 300000 ton / year methanol to olefin unit in the west of Shandong Province was successfully commissioned last week. At the same time when the export of methanol was stopped, the daily purchase volume was 300-400 tons. The market demand in Shandong Province increased rapidly, driving the overall price higher.

Rapid decline of port inventory

In the early stage, the port area has maintained a normal inventory of 1.2-1.3 million tons. However, last week, the port area’s inventory dropped by a large margin of 150000 tons. In addition, the previous weeks’ inventory dropped. At present, the port area’s inventory has dropped to a reasonable level near 900000 tons.

On the one hand, due to the recent closure of the Yangtze River fog, part of the cargo unloading is slow; on the other hand, due to the rapid reduction of supply in the northwest and southwest regions, and the low spot price in the port area, the backflow window from the port to the mainland has been opened, and the inland Shandong, Jiangxi, Hunan and Hubei regions have started to accept imported methanol, resulting in the port area inventory There was a rapid drop.

Abundant supply in later period

Through careful analysis, it can be found that the current methanol market is in a good state, which is difficult to continue. First of all, the natural gas to methanol plant in Southwest China will be limited for about one month this year, and the early shutdown means the end of maintenance and start-up in advance, which will severely suppress the methanol market in January next year. Secondly, the methanol units overhauled in Shaanxi, Gansu and Inner Mongolia have been fully restarted at the beginning of this week. In addition, the methanol units restarted after the completion of technological transformation in Northern Shaanxi now have considerable supply capacity again. This is also the reason why the price in Northwest China fell this week.

In the port area, the closure caused by heavy fog and other weather factors has been gradually lifted in the near future, and the ships with demurrage in the early stage have begun to unload gradually. According to incomplete statistics, there are about 150000 tons of methanol in the port area. After the fast unloading of these methanol, the inventory in the port area will have a surge process.

In terms of downstream demand, the recent haze in the north is serious, and a new round of environmental protection and production restriction has begun. In December, the formaldehyde operating rate will gradually decline, and the methanol demand will decline is an indisputable fact.

Winter is a stable period for the start-up of methanol plant in North China. Unless there is an accident, the possibility of maintenance in winter is low. Inland methanol plant will always maintain a high start-up and relatively stable supply. However, the downstream demand for methanol in coastal areas will be significantly weakened, and the traditional downstream start-up will be reduced. Some methanol to olefin units will also be overhauled in December. Under the premise of no reduction in the import to port volume, the supply pressure in the port area is not optimistic. It is worth mentioning that, despite the decline of inventory in the port area, the tradable inventory is still maintained at more than 300000 tons, indicating that the supply is still abundant.

To sum up, in the early stage, due to the superposition of unexpected factors, the market may be temporarily prosperous or come to an end. At present, the methanol 2001 contract is close to delivery, and the set holding position is larger than that in the same period of previous years, indicating that the market is still bearish.

I. price trend of lithium hydroxide:

According to the data of the business club’s large scale list, the average price of enterprises on November 10 was 67666.67 yuan / ton, the average price of enterprises on December 10 was 57666.67 yuan / ton, and the monthly drop of lithium hydroxide was 14.78%. In a three-month cycle, it fell 19.16% year-on-year.

II. Market analysis:

Product: Recently, the overall market of lithium hydroxide has shown a downward trend. At present, the external quotation of industrial grade lithium hydroxide of Shanghai Yulun Industrial Co., Ltd. is 58000 yuan / ton, the external quotation of industrial grade lithium hydroxide of Shanghai Eugene Industrial Co., Ltd. is 60000 yuan / ton, and the external quotation of industrial grade lithium hydroxide of Zigong tongfarong Industrial Co., Ltd. is 55000 yuan / ton. The specific price will be discussed in a single way.

Industry chain: since December, the upstream lithium carbonate price is still in a downward trend, with the decline of industrial lithium carbonate of 1.65% (12.1-12.10) and battery lithium carbonate of 0.73% (12.1-12.10). At present, enterprises are still pessimistic about the future market. Some enterprises take the initiative to reduce the price for shipment due to the pressure of inventory and cash flow, while some enterprises still have the pressure of inventory, and the price goes with the market.

Industry: according to the price monitoring of the business agency, on December 9, 2019, in the list of commodity prices, there were 14 kinds of commodities in the chemical sector, including 2 kinds of commodities with an increase of more than 5%, accounting for 2.4% of the number of commodities monitored in the sector; the top three commodities were dichloromethane (5.77%), bisphenol A (5.38%) and organosilicon DMC (2.12%). There are 12 kinds of commodities falling on a month on month basis, and there are 3 kinds of commodities falling by more than 5%, accounting for 3.5% of the number of commodities monitored in this sector; the top 3 products falling are lithium hydroxide (- 13.50%), caustic soda (- 6.25%) and epichlorohydrin (- 5.33%). The average price of this day was – 0.2%.

3. Future forecast:

Analysts of lithium hydroxide in the business club believe that the price of upstream lithium carbonate market is weak and the cost support is weak. The operating rate of industrial grade lithium hydroxide has been at a low level, but the downstream demand is light. It is expected that the market of lithium hydroxide will be stable in the short term.