According to the Commodity Market Analysis System of Shengyi Society, as of March 7th, the average sales price of PET was 6162 yuan/ton, which was dragged down by the raw material price. This week, the price showed a weak downward trend.

In terms of cost, the international crude oil market was affected by geopolitical easing, OPEC+production expectations, and the accumulation of US refined oil inventories. The weekly average price of Brent crude oil fell 2.15% month on month to $73.87 per barrel, weakening the cost support of the polyester industry chain. The PTA processing fee is at a low level (300-350 yuan/ton), and the improvement of the supply and demand structure of ethylene glycol is limited. The price focus of both has shifted downwards, further dragging down the cost of polyester bottle chips.

On the supply side: The polyester bottle chip industry is at the end of its capacity expansion cycle, with plans to add 2.15 million tons of new production capacity by 2025. Coupled with the current high inventory level during the same period, market concerns about oversupply have intensified. Despite weak demand, the operating rates of major production enterprises remain high, leading to a continuous increase in supply and exacerbating the supply-demand imbalance.

In terms of demand, downstream enterprises have limited demand for replenishing inventory after the holiday, and traders and end users are mostly adopting a wait-and-see attitude. The market lacks momentum in chasing price increases, and actual transactions are light. The weak recovery of terminal demand in the polyester industry chain and the accumulation of inventory of polyester filament and other products indirectly affect the confidence of the bottle chip market.

In response to the current market situation, Shengyi Society believes that the lack of upward driving force in crude oil and raw material prices, coupled with the release of new production capacity and inventory pressure, is difficult to alleviate. In the short term, the price of polyester bottle chips may continue to fluctuate weakly. The actual trend still needs to pay attention to the subsequent equipment and demand situation, as well as the cost support under the traction of crude oil.

According to the Commodity Analysis System of Shengyi Society, on the 6th, the market price of styrene fell, with a daily decline of 0.93%. Overall, international oil prices have recently fallen, with average support from the raw material side. Supply side production has slightly declined, while port inventory remains high. Downstream production of 3S has been restored to normal levels, but inventory accumulation remains high and there is significant resistance to further increase in production. Currently, styrene is mainly constrained by the decline in crude oil prices, with a strong willingness to ship and a poor mentality, resulting in a continuous decline in styrene prices. The demand improvement needs to be restored, and it is expected that the market will consolidate and operate after a short-term decline.

The price of plasticizer DOP fluctuated and fell in February

According to the Commodity Market Analysis System of Shengyi Society, as of February 28th, the DOP price was 8326.25 yuan/ton, which first increased and then decreased by 2.92% compared to the DOP price of 8576.25 yuan/ton on February 1st. After the holiday, there was a brief increase in demand for DOP plasticizers, but as the replenishment ended, the demand for plasticizers decreased; The production of plasticizer DOP enterprises has fallen, and the supply of plasticizer DOP has tightened; The price of phthalic anhydride fluctuated and fell, while the price of isooctanol first rose and then fell. The cost of plasticizer DOP decreased, and the downward pressure on plasticizers increased.

The price of raw material isooctanol first rose and then fell in February

According to the Commodity Market Analysis System of Shengyi Society, as of February 28th, the price of isooctanol was 7666.67 yuan/ton, which first increased and then decreased by 1.71% compared to the price of 7800 yuan/ton on February 1st; Compared to February 15th, the price of isooctanol decreased by 4.37% to 8016.67 yuan/ton. The price of isooctanol has fluctuated and fallen, while the cost of plasticizer DOP has decreased; After the holiday, plasticizer companies temporarily replenished their inventory, and the demand for isooctanol increased first and then decreased, increasing the downward pressure on isooctanol.

Demand for plasticizers decreases in February

After the Spring Festival, downstream inventory replenishment led to a brief increase in demand for plasticizers; With the end of inventory replenishment, the demand for plasticizers has fallen, and coupled with the slow start of terminal demand, the demand for plasticizers is weak. The plasticizer industry is facing a certain degree of pressure to block inventory, and unsaturated resins and other downstream industries are also facing problems such as slow terminal pickup and insufficient consumption. The growth of plasticizer demand is slow, and the support for plasticizer rise is insufficient; Plasticizer companies are operating at a low level, and the supply of plasticizers is tight.

Future expectations

According to the data analyst of Shengyi Society’s plasticizer products, in terms of cost, the price of isooctanol first rose and then fell, the price of phthalic anhydride fluctuated and fell, and the cost of plasticizer DOP decreased; In terms of demand, the replenishment of inventory has ended, coupled with slow recovery of downstream production, resulting in a decrease in demand for plasticizers. In the future, with the decrease in costs and the tightening of supply and weak demand for plasticizers, it is expected that the price of DOP plasticizers will fluctuate and fall.

1、 Price trend

According to data monitored by Shengyi Society, as of February 28th, the average quotation price of domestic high-quality DMF enterprises was 4280 yuan/ton. Currently, the DMF market price is mainly stable, and the price is mainly stable.

2、 Market analysis

This week, DMF prices have remained stable. Currently, downstream demand for DMF is average, with rigid procurement being the main focus. The overall market supply and demand are balanced. The reference price for DMF spot delivery in Shandong and surrounding areas is 4400 yuan/ton, while in Jiangsu and Zhejiang regions it is around 4500 yuan/ton.

3、 Future forecast

DMF analysts from Shengyi Society believe that the DMF market is expected to operate weakly in the short term, with insufficient driving force for price increases.

The recent surge in cobalt prices

According to the Commodity Cobalt Market Analysis System of Shengyi Society, the cobalt price on February 28th was 176100 yuan/ton, a significant increase of 9.93% compared to the cobalt price of 160200 yuan/ton on February 21st. Recently, the government of the Democratic Republic of Congo announced that it will ban all cobalt exports for the next four months, and plans to introduce a cobalt export quota system. This has led to a tight supply in the cobalt market and a significant increase in cobalt prices.

Congo suspends cobalt exports for 4 months

The Strategic Mineral Market Supervision and Control Authority of the Democratic Republic of Congo issued a statement on the same day, stating that the Prime Minister and Minister of Mines of Congo signed a decree to suspend cobalt exports for four months in response to the global cobalt market oversupply situation. This measure will come into effect on February 22nd. The statement stated that an evaluation will be conducted in three months, and the suspension measures may be adjusted or lifted according to the situation.

Congo plans to introduce cobalt export quota system

Faced with the dual pressure of slowing demand from automobile manufacturers and mining companies increasing cobalt production to boost copper production, cobalt prices have fallen to historic lows. The government of the Democratic Republic of Congo has begun to consider a more long-term solution – introducing a cobalt export quota system. The government of the Democratic Republic of Congo plans to negotiate with relevant stakeholders during the upcoming export suspension period to reach a consensus on the specific details of the quota system. This includes key elements such as determining the total amount of quotas, allocation methods, and regulatory mechanisms.

Overview and Prospect

According to data analysts from Shengyi Society, the government of the Democratic Republic of Congo has previously announced a ban on all cobalt exports for the next four months, and this temporary ban may not be sufficient to effectively restrict the flow of cobalt metal in the market. Due to many companies having already reserved a large amount of inventory in advance, it is expected that these inventories will be released into the market after the ban is implemented, further lowering cobalt prices. The temporary ban may have a relatively limited boost to cobalt prices and may not have a lasting impact.

On February 9, 2024, the President of the Democratic Republic of Congo called on the government to take emergency measures to better regulate cobalt sales and increase cobalt mining revenue, assess the necessity of implementing export quotas or taking other measures to ensure the price profit of cobalt in the Democratic Republic of Congo. Recently, the export quota system has been reintroduced, and the process is full of challenges. The government of the Democratic Republic of Congo needs to negotiate with relevant stakeholders because their interests and demands are different, and it is necessary to balance the supply and demand relationship of domestic and foreign markets. The introduction of an export quota system by the government of the Democratic Republic of Congo is facing many difficulties.

Overall, the government of the Democratic Republic of Congo is optimistic about the introduction of cobalt export quota system, but the international market does not take it seriously. The government of the Democratic Republic of Congo has banned the export of cobalt products, which has provided significant support for the rise in cobalt prices. However, the implementation of the cobalt export quota system is difficult, and the quota system may not be able to change the situation of oversupply. In the short term, the sustained rise in cobalt prices is not supported. In the medium to long term, the strength of the government’s ban on cobalt product exports determines the trend of cobalt prices.