1、 Market price overview
| Melamine |
The increased willingness of melamine companies to raise prices this week may be driven by multiple factors. As of May 8th, the benchmark price of melamine in Shengyi Society was 5900.00 yuan/ton, a decrease of -0.42% compared to the beginning of this month (5925.00 yuan/ton).
2、 Market supply and demand situation
1. Cost side support: The main raw material for melamine is urea. If urea prices are affected by rising energy costs such as coal and natural gas or supply shortages in the near future, the production costs of enterprises may increase, and the pressure may be transferred through price increases. As of May 8th, the benchmark price of urea in Shengyi Society was 1906.67 yuan/ton, an increase of 1.69% compared to the beginning of this month (1875.00 yuan/ton).
2. Supply side contraction: The industry enters a period of centralized maintenance, or in some areas, production capacity is limited due to environmental policies and safety production inspections, resulting in short-term supply reduction and increased bargaining power of enterprises.
3. Demand: The international market demand has rebounded (such as the growth in demand for building materials and coatings in Southeast Asia, the Middle East, and other regions), or overseas production has been impacted by the energy crisis (such as the reduction of melamine production capacity in Europe), leading to an increase in export orders from domestic enterprises and supporting domestic trade prices.
If downstream industries such as sheet metal and coatings enter the peak production season (such as the release of demand in the real estate post cycle), or if downstream enterprises replenish their inventory to drive procurement enthusiasm, it may drive up prices.
3、 Inventory and price
1. Inventory situation: Due to weak downstream demand, the inventory pressure of melamine enterprises is gradually increasing. However, due to the relatively controllable overall inventory pressure, the company did not adopt a strategy of large-scale price reduction and promotion, but chose to temporarily stabilize prices until market demand recovers.
2. Price trend: Recently, the price of melamine has been relatively stable but showing a weak downward trend. In the first quarter, with the gradual release of new production capacity and the continued weakness of downstream demand, the price of melamine further fell and operated at a low level. In the near future, with the gradual adjustment of supply and demand, the price of melamine is expected to stabilize or even rebound slightly.
4、 Market outlook
Due to the constantly changing supply and demand relationship, production costs, and other factors, the market price of melamine may continue to fluctuate. With the gradual release of new production capacity and the sustained weakness of downstream demand, competition in the melamine market may further intensify. Against the backdrop of gradually improving international trade environment, the export market for melamine in China is expected to further expand, which will have a certain impact on domestic market prices.
In summary, the market atmosphere for melamine this week was average, but due to the overall low inventory pressure, prices have temporarily stabilized. In the foreseeable future, with the gradual adjustment of supply and demand and the continuous changes in policy environment, the melamine market is expected to usher in new development opportunities.
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