When will the PP market usher in a turnaround?

In May, the PP market was overwhelmingly windy, and the price center of gravity continued to move downward. According to analysis, in addition to the frustration and restraint mentality of PP's main futures, the petrochemical companies' move to lower the ex-factory price has also caused a big impact on the spot market. Affected by this, the willingness of traders to hoard goods is not strong, and the operation is mainly based on fast-forward and fast-out. However, end users are generally cautious in purchasing, and can maintain production within nearly a week, and basically do not do too much hoarding. As of the end of the month, with the exception of fibers, powders, and pipes that were relatively stable, other resources had fallen to varying degrees, especially the transparent material M800E. After being frantically speculated to a high level in the early stage, the current price has gradually returned to rationality.

　　 Can the PP market in June usher in an opportunity to turn around?

　　 1. The divergence between supply and demand has increased, which has caused power failure.

　　 Regarding the future trend of crude oil prices, the industry mostly believes that the driving force for the rise is declining. 1. The recovery momentum of the US economy has slowed down; 2. The Fed may signal QE reduction in advance due to high inflation and excessive speculative risks in the financial market; 3. The recovery of crude oil demand shows signs of slowing down, mainly reflected in the counterattack of the epidemic in India and other places On the one hand: Fourth, OPEC crude oil production is picking up month by month, while shale oil production activities in the United States are slowly recovering. There are indications that it is still difficult for the international oil price to break through 70 US dollars per barrel in the later period.

　　 Second, PP futures are weak and under pressure, and the spot market is hard to be optimistic.

　　 As of today, it closed at 8,366 CNY/ton, a decrease of 350 CNY/ton from the beginning of the month (8726 CNY/ton). The main weak trend of PP futures has outstanding characteristics, especially since mid-May, it has been in a downward trend of shocks, and there is no sign of stabilizing or rising. This is not good news for the spot market.

　　 Three. It is known that there are not many planned overhauls and the supply of resources is relatively stable.

　　 It is currently known that only Shenhuaning Coal Line 1, 2, 3, and 4 have an overhaul plan in early June, and it is expected to stop for about 20-25 days. In addition, the parked Zhenhai Refinery 2PP will drive in early June, and the drive time of Shenhua Xinjiang is to be determined. Compared with the previous two months, the amount of resource losses in June was relatively small, and the stable supply of resources may hinder the spot.

　　4. The peak power limit in summer hits, and terminal demand is facing a test

　　 The terminal demand lacks hot stimulus, and the overall performance has always been "lack to report." In addition, as the summer strikes, all regions will inevitably initiate production curtailment measures. At present, Guangdong, Yunnan, Sichuan, Inner Mongolia, Zhejiang and other places have issued notices of orderly power consumption peaks, and many downstream manufacturing companies have received curtailment. Notice.

　　There are not many factors that stimulate the PP spot market to counterattack. Therefore, the trend of intraday loosening may still be the main tone under the condition that the basic pattern has not changed.