July 7th News
As of July 6th, the melamine market in China continued to show weakness this week, with prices fluctuating downward and overall performance remaining weak. On July 7th, the benchmark price of melamine was reported at 6037.50 CNY/ton, a decrease of 0.21% from the price of 6050.00 CNY/ton at the beginning of July.
1. SpotCom Moving Average Trend: The downward trend is clear, and the downward pressure continues to increase.
From the moving average system of the melamine price trend chart, the 10-day and 20-day moving averages show a downward trend throughout, with the 10-day moving average always below the 20-day moving average. The market's downward momentum is still being released, but the pace of decline has slowed. Throughout the cycle, the price has followed the moving averages downward, with the moving averages continuously suppressing the spot price.
II. Price Levels in 5 Stages: Throughout the entire cycle, prices remain low, with limited room for upward movement.
According to cyclical positioning data, melamine’s position within the one-year cycle is consistently marked as low. Although prices have already reached historically low levels, they have failed to attract buying interest; the low price level has not provided any support, and the market continues to trend downward in a subdued manner. On July 3 and June 30, prices fell slightly by 0.21%, while on other trading days, prices remained flat. The price of 6,037.50 CNY/ton has stayed stable for several consecutive days, indicating a state of prolonged stagnation at a low level.
3. Upstream Raw Material Linkage: Urea Weakens in Sync, Lacking Cost Support
Melamine's core raw material, urea, also showed a downward trend this week. On July 7, the benchmark price of urea was 1802.50 CNY/ton, a decrease of 0.62% compared to the beginning of the month at 1813.75 CNY/ton. The continuous decline in raw material prices cannot provide cost support for melamine. With the loosening of upstream costs, manufacturers' production costs have decreased, and the willingness to sell at a discount has increased, further suppressing the room for melamine prices to rebound.
4. Future Market Forecast
Currently, the melamine price spread index remains negative, with the downward trend yet to be reversed. Prices are at a low point throughout the cycle but lack support. Coupled with the continuous weakening of upstream urea costs, the short-term market fatigue is unlikely to improve quickly. The market is mainly characterized by a stalemate at low levels. Without any sudden positive news to boost, prices may continue to operate in a narrow and weak range, and signals for a bottom have not yet appeared.
