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.

1、 Price trend

According to the Commodity Market Analysis System of Shengyi Society, the price of bromine is temporarily stable. On February 27th, the average market price was 21800 yuan/ton, a decrease of 2.68% compared to the same period last year. On February 26th, the Business Society Bromine Index was 76.49, unchanged from yesterday, a decrease of 68.80% from the highest point of 245.18 points (2021-10-27) during the cycle, and an increase of 29.82% from the lowest point of 58.92 points on October 29, 2014. (Note: The cycle refers to the period from September 1, 2011 to present)

2、 Market analysis

This week, the price of bromine has been running steadily, with prices in Shandong region remaining stable. The mainstream market price is around 21000-22000 yuan/ton. Currently, bromine is in a weak supply-demand situation, with tight supply but average downstream demand. In terms of raw materials, domestic sulfur prices have remained firm, with an average market price of 2081 yuan/ton, an increase of 105.36% compared to the same period last year. Downstream demand is still acceptable.

Prediction: Bromine prices are expected to remain stable in the near future, while upstream sulfur prices are expected to rise. Downstream demand for bromine is still mainly based on on-demand procurement. The comprehensive supply-demand game predicts that bromine may continue to consolidate in the later period, depending on downstream market demand.

According to the monitoring of the commodity market analysis system of Shengyi Society, the average price of LLDPE (7042) was 8430 yuan/ton on February 1st and 8246 yuan/ton on February 26th, with a price drop of 2.17% during this period. LDPE (2426H) had an average price of 9950 yuan/ton on February 1st and 10133 yuan/ton on February 26th, with a price increase of 1.84% during this period. HDPE (2426H) had an average price of 8400 yuan/ton on February 1st and 8387 yuan/ton on February 26th, with a price drop of 0.15% during this period.

The trend of polyethylene market in February is different, with weak linear product trend, strong high-pressure product trend, and narrow adjustment of low-pressure product trend, with little change. The pressure on the supply side is still present. In the early stage, new production capacity was steadily added, and plastic companies resumed work and production after the holiday. There are expectations of an increase in the market. In addition, there were fewer polyethylene maintenance units in February, but some high-pressure product units were converted and shut down, resulting in a tentative increase in high-pressure product prices. The trends are different, and the prices are relatively strong. In late February to March, spring plastic film enters the traditional peak season, and orders continue to accumulate. However, the demand for greenhouse film enters the off-season, and there is insufficient market order follow-up. The upcoming National People’s Congress and the Chinese People’s Political Consultative Conference are expected to boost demand in the commodity market, with a relatively warm macro outlook. The weak economic data in Europe and the United States has intensified market concerns about energy demand. In addition, the expectation of increased production in some oil producing countries is bearish on the market. Recently, the cost side has loosened significantly, which is bearish on the polyethylene market.

The inventory pressure on the supply side is still ongoing, and the demand for plastic film is gradually entering the peak season, which may provide some support. Against the backdrop of a double increase in supply and demand, it is expected that the upward space for polyethylene will be limited and the change will not be significant.

price trend

According to the bulk ranking data from Shengyi Society, at the end of February, the domestic PC market continued the weak consolidation trend, and most spot prices of various brands fell. As of February 25th, the mixed benchmark price of Business Society PC is around 16166.67 yuan/ton, with a price increase or decrease of -1.92% compared to early February.

cause analysis

On the supply side: At the end of February, the load of domestic PC aggregation enterprises increased at a high level, and the industry average operating rate rose by 2% to over 82%. The average weekly production remains at a super high level of over 65000 tons, and there is ample supply of goods on site. The supply-demand imbalance is intensifying, and some manufacturers have set new factory prices. In addition, the inventory position is relatively high, and the on-site pricing continues to be at a low level. The market supply side has poor support for PC prices.

In terms of raw materials: From the above chart, it can be seen that the recent fluctuation and decline in the bisphenol A market are the main reasons, and the price trend is weak. Upstream acetone trading was sluggish, with a high level turning down. Phenol oscillates during operation, and the cost side provides only moderate assistance to bisphenol A. The burden on the bisphenol A industry has increased, and the supply has relaxed. Downstream weak demand leads to a decrease in actual orders from merchants. There is a lack of bullish guidance in the market, and the confidence of industry players is weak. Overall, the support for PC costs is average.

On the demand side: The PC consumption pattern has been weak for a long time, and the overall platform level has not improved compared to mid February. The return of downstream factories during holidays is slow, and the load increase of end enterprises is not significant. Due to poor on-site stocking, the purchasing logic is focused on weak demand, and there is still a certain amount of inventory to be digested. The wait-and-see attitude of businesses is biased, and buyers are resistant to high priced goods, increasing the pressure for businesses to sell. The circulation of goods in the market is slow, and the overall trading situation is basically continuing the light performance after the holiday. The demand side has poor support for PC spot prices.

Future forecast

At the end of February, the domestic PC market fell weakly. The upstream bisphenol A market is currently weak and volatile, which weakens the support for PC cost side. The load of domestic PC aggregation plants has increased at a high level, and the supply is loose. Industry inventory is high, and supply pressure is increasing instead of decreasing. The signs of slow recovery in downstream demand remain, with poor new orders and a deepening trend of supply-demand contradictions. It is expected that PC will continue to operate weakly in the short term.