In early November, the domestic ABS market was weak and continued to trend, with most spot prices of various grades lowered. According to the Commodity Market Analysis System of Shengyi Society, as of November 10th, the average price of ABS sample products was 8882.50 yuan/ton, with a price level increase or decrease of -2.87% compared to early November.
Fundamental analysis
Supply level: Since early November, the operating rate of the domestic ABS industry has fluctuated, with large stability and small movements. There is a restart of the Zhenjiang Qimei 7 series production line within the interval; Some production lines of Zhejiang Petrochemical are carrying out equipment upgrade tasks; Sinopec’s Ineos Benzene Line has been shut down for maintenance, and the overall industry load level has been slightly reduced to 71.5%, with an average weekly output of around 145000 tons. The on-site supply remains abundant, and the inventory position of the aggregation enterprise is close to 260000 tons, holding firm at a high level. Overall, the long-term loose supply pattern in the ABS market remains unchanged, and the supply side’s support for ABS spot prices continues to be weak.
Cost factor: In early November, the ABS upstream three material market experienced one rise and two falls, which had a negative impact on the ABS cost side. During the acrylonitrile cycle, the overall supply remained loose, and local enterprise inventories increased. However, the spot price has already fallen to a low point in the early stage, and downstream users have followed up with restocking at low prices. Factory inventory is temporarily controllable, stimulating suppliers to slightly increase their quotes. However, the operating rates of various downstream sectors have remained stable with some declines, and the market continues to lack sufficient upward momentum. It is recommended to closely monitor the trend of the device in the future and wait for further favorable developments.
The domestic butadiene market experienced overall fluctuations in early November. With the continuous decline in prices, it has also attracted some downstream buyers to replenish inventory at low prices, driving the trading atmosphere in the spot market to improve and prices to slightly rebound. On the other hand, there has been no effective improvement in the actual demand of downstream terminals, and the market lacks favorable factors to boost it. It is expected that the butadiene market will be weak and volatile in the short term.
The recent market trend of styrene continues to be weak. Although the raw material pure benzene market has slightly improved, there is a shortage of subsequent orders, and the situation of continued losses persists. In November, the styrene market underwent maintenance and new investment coexisted. Currently, supply is loose and port inventories are at a high level during the same period, with limited upward drive. It is expected that the styrene market will have a weak trend in the short term.
On the demand side: In the medium to long term, the downstream factories of ABS have had average loads. The overall stocking logic of terminal enterprises still maintains the urgent need for replenishment, and the flow rate of goods supply is slow. The inventory position of merchants is also high, and under the increasing pressure of on-site sales, enterprises and merchants continue to offer discounts and take orders. On a macro level, due to the weakened profitability of terminal enterprises and external market turbulence, the consumption of the main downstream electrical appliance shell industry has been hindered, and production has not seen any increase for a long time. The cautious atmosphere in both domestic and foreign markets remains unchanged, and the industry lacks momentum. Overall, there has been no improvement in the demand side’s support for the ABS market.
Market outlook
The domestic ABS market maintained a downward trend in early November. The production load of the aggregation plant remains stable with small fluctuations, while consumer demand remains low and flat. Business analysts believe that the long-term imbalance between supply and demand in the ABS market has dragged down spot prices, making it difficult for the market momentum to improve. At the same time, the three upstream materials have weakened, and many industry players have a bearish attitude. It is expected that there will still be downward pressure on ABS in the short term.
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