Cost Values Fluctuating, PC Market Prices Volatile at High Levels

March 23rd, News

Price Trend

According to the bulk commodity list data, the recent Chinese PC market has seen a rapid increase, with most grades showing a significant rise in spot prices. As of March 23, the benchmark price for mixed PC is around 16,110 CNY/ton, representing a 23.67% increase from the beginning of the month.

Reason Analysis

Supply Side: In mid-March, the overall load of China's PC polymerization enterprises remained largely stable with minor fluctuations. The previous single-line shutdown due to strong winds in Jiangning has returned to operation; the overall average operating rate of the industry has adjusted back to around 86%, with a weekly production of over 70,000 tons. Although social inventory has accumulated, there are maintenance plans for Cangzhou Dahua and Covestro in early April, which will lead to a significant reduction in supply. Overall, the supply side still provides moderate support for PC.

Raw Materials Perspective: As shown in the chart above, the Chinese bisphenol A market has recently experienced a period of consolidation following a recent price increase. Influenced by sharp fluctuations in international crude oil prices, phenol and acetone prices have been moving in tandem, thereby driving the spot price of bisphenol A in China. Meanwhile, the supply of bisphenol A has remained relatively limited in the earlier period, and with crude oil prices continuing to rise recently, there is still room for further upward movement in bisphenol A prices in the future. This bodes well for supporting the cost of polycarbonate.

Demand Side: The profitability of end-user companies has shown only limited improvement, and downstream PC factories continue to operate at a moderate capacity level. Currently, PC prices have risen to relatively high levels, prompting buyers to adopt a more cautious approach to inventory building. Coupled with the need to clear out post-holiday inventories downstream, buyers remain reluctant to increase their stockpiles and have shifted into a wait-and-see stance. Meanwhile, international crude oil prices continue to fluctuate and push up petrochemical industry costs and logistics expenses, driving a synchronized rise in bulk commodity prices. Although the speculative hype in the PC market earlier has somewhat subsided, traders’ sentiment remains weak at present, and they are attempting to quote higher prices. Overall, the demand side provides only moderate support for PC spot prices.

Future Market Forecast

Recently, the Chinese PC market has been experiencing high volatility. Due to the ongoing impact of geopolitical tensions, crude oil and related petrochemical products have been fluctuating at high levels. The price of upstream bisphenol A has surged and adjusted, with cost values being passed on to PC. In the middle of the month, Chinese PC polymer plants showed general stability with minor adjustments. The industry is expected to undergo concentrated maintenance, leading to a further tightening of supply. Trading within the market is mainly driven by rigid demand, with buyers adopting a cautious attitude and returning to just-in-time purchasing, resulting in small-scale transactions. It is anticipated that in the short term, the PC market may be influenced by the dual benefits of rising upstream costs and tightened supply, potentially leading to further price increases.