Mainstay Enterprises Reduce Load, PC Prices Rise in Early December in China

December 10th, news

Price Trend

According to the bulk commodity list data, in early December, the PC market in China turned positive, with spot prices for most grades increasing. As of December 10, the mixed benchmark price for PC was around 13,983.33 CNY/ton, representing a change rate of +0.48% compared to the end of November.

Reason Analysis

Supply Side: In early December, the overall load of China's PC polymerization enterprises increased and then decreased. At the beginning of the month, the maintenance tasks of Pingmei Shenma were completed, and operations gradually restarted. Recently, Zhejiang Petrochemical implemented a rotating maintenance plan for multiple production lines, causing the industry's operating rate to fall below 80%, with the weekly average output approaching 67,000 tons. Due to the tightening supply of basic grade materials and the relatively manageable inventory levels after earlier digestion, several polymerization plants have raised their ex-factory prices. Overall, the supply side of PC has strengthened its support for the market.

Regarding Raw Materials: As shown in the chart above, the BPA market experienced a price increase in early December. Although upstream phenol and acetone prices have bottomed out and stabilized, this does not necessarily provide significant support for the BPA market. However, after being digested throughout November, inventory pressure at BPA plants has eased. Meanwhile, spot prices had previously fallen to low levels, prompting companies and traders to adopt more aggressive pricing strategies, thus enabling the market to rebound from its earlier bottoming-out phase. On the other hand, demand for BPA remains limited, and actual transaction activity is rather subdued. It is expected that future BPA price increases will be relatively modest, providing only slight improvement in cost support for PC production.

Demand Side: Affected by the weakening profitability of end-user companies, downstream PC factories continue to operate at less-than-ideal capacity levels. Inventory replenishment remains characterized by buying on dips, with weak rigid demand. E-commerce and overseas markets have shown only moderate responses to finished PC products, prompting PC end-users to adopt a conservative production schedule. Within this price range, traders are following the upward trend set by aggregators, yet buyers remain cautious in their follow-up actions. Nevertheless, bullish sentiment for the future market is strong, driving up spot prices and shifting the center of gravity for actual transactions higher. Overall, demand-side support for PC spot prices remains moderate.

Future Market Prediction

In early December, the Chinese PC market saw a rise in prices. Upstream bisphenol A prices stopped falling and began to increase, providing more cost support for PC. After an initial increase, the operating rates of Chinese PC polymerization plants were reduced, leading to expectations of tightening supplies for basic grades. The sentiment in the market remains bullish. However, trading activity remains moderate, and it is expected that the upward trend in PC prices may be limited in the short term.