August 1st, according to the news,
Price Trend
According to Spotcom data, the domestic PC market in China experienced a decline followed by a rise in July, with spot prices for various grades showing a significant increase. As of July 31, the mixed benchmark price for PC was around 13,983.33 CNY/ton, representing a 7.84% increase from the beginning of the month.
Reason Analysis
Supply side: During July, the operating rates of China's PC polymerization enterprises rebounded. At the beginning of the month, Pingmei Shenma restarted, and Luxi Petrochemical restarted one production line. By the end of the month, Zhejiang Petrochemical and Shengtong Polyurethane's facilities returned to operation, with the overall industry load rate exceeding 84%. Production losses gradually decreased, and the current weekly output is close to 70,000 tons, with the smoothness of shipments from polymerization plants being average. Additionally, the restarts of Zhangzhou Chi Mei and Sichuan Tianhua, originally scheduled for late July, were postponed to August. Overall, the supply side's support for PC is weak, and expectations are also pessimistic.
Regarding Raw Materials: As shown in the chart above, since entering July, the Chinese Bisphenol A market has continued to experience a broad-based price increase from its already low levels. International crude oil prices have risen sharply, influenced by recurring geopolitical tensions in the Middle East, driving significant increases in acetone and phenol prices as well. Meanwhile, supply of genuine branded products within the market has gradually tightened. Throughout this period, market sentiment toward Bisphenol A has remained positive, with holders generally adopting a bullish stance and raising prices. The availability of lower-priced downstream supplies has dwindled, and as transaction prices have risen across the board, buyers’ willingness to accept these higher prices has declined. Overall, actual demand has remained relatively stable, and throughout the month, support for polycarbonate (PC) costs has remained strong.
Demand Side: Sales at downstream PC factories remain at the usual off-season level, with demand for sheet materials and enclosures softening. End-user companies are operating at low capacity utilization rates. Currently, PC prices have essentially reached their lowest point of the year, and market sentiment is heavily characterized by wait-and-see attitudes. Buyers are cautious about stocking up and show little willingness to build inventories. Although traders are attempting to quote higher prices, end-users remain wary, leading to slower liquidity in the supply chain. Despite the upward shift in pricing focus by polymer producers, the existing supply in the market still needs to be absorbed. Overall, demand-side factors provide weak support for PC spot prices.
Future Market Prediction
In July, the Chinese PC market experienced a rise after a decline. The price of upstream bisphenol A rose to a high level, significantly increasing the cost support for PC. The operating rates of Chinese PC polymerization plants have increased, and there is still an expectation for further increases, leading to an expectation of more relaxed supply in the future. Trading within the market is mainly driven by weak but necessary demand, with cautious inventory stocking and more frequent small orders. Currently, with increased supply and weak demand, the market is at a high level with significant resistance to further increases. It is expected that the market may continue to consolidate in the short term.
Technical Analysis
Analysts believe that, according to SpotTong data, on July 16, the 10-day moving average of PC prices crossed above the 20-day moving average, and the spread between these two averages has since expanded positively before stabilizing. Auxiliary indicators show that PC prices in all five price tiers are currently at recent highs, with distant-term prices remaining at mid-to-low levels. We judge that PC prices are likely to remain at a phased high in the short term, and upward price movements may be constrained. In the near future, we recommend closely monitoring the fundamental factors underlying PC prices.
