In early September, the domestic ABS market was weak and consolidated, with some grades experiencing a decline in spot prices. According to the Commodity Market Analysis System of Shengyi Society, as of September 10th, the average price of ABS sample products was 11587.50 yuan/ton, an increase or decrease of -1.07% compared to the price level on September 1st.
Fundamental analysis
Supply level: In early September, the load level of the domestic ABS industry was average, and the total repair capacity of enterprises was slightly higher than the resumption capacity. The operating rate of the domestic industry was reduced by 3% to about 62%. However, due to slow digestion of the supply, the narrow reduction in supply has not led to a decrease in overall inventory. Recently, ABS finished product inventory has slightly accumulated at over 180000 tons. Overall, the current supply side has moderate support for ABS spot prices.
Cost factor: Within this ten day period, the overall trend of the three upstream materials of ABS has fallen twice and remained flat, which has a poor support effect on the cost side of ABS. The acrylonitrile market experienced narrow fluctuations and consolidation, which differed significantly from the expectations of the traditional peak demand season in the market. At the beginning of the month, due to a decrease in the company’s negative load to 63.72%, the offer rose slightly by 100 yuan per ton before returning to calm. It is expected that the acrylonitrile market will continue to face weak demand pressure in the short term, and prices may maintain a volatile trend.
Recently, the butadiene market has remained stable with small fluctuations. The arrival of goods from ports within the range and the emergence of exports to the northern region have alleviated the problem of tight supply in the northern market. The downstream market demand has returned to a moderate level, which has limited support for the market atmosphere. Overall, the supply and demand pattern may both weaken in the short term, and it is expected that the butadiene market will turn weak and fluctuate.
The styrene market has fallen this week. Due to the significant decline in crude oil prices, the price of pure benzene has been dragged down, and the cost support of styrene has cooled down. However, the demand for styrene spot goods remains strong, and there may even be a slight increase within the next ten days. Recently, there have been fewer maintenance visits to the styrene plant, resulting in relatively abundant supply. However, the inventory pressure at ports in East China is relatively low. There is a struggle between long and short positions within the venue, making it difficult for industry players to build confidence. It is expected that there will still be a slight decline in the future market.
In terms of demand: Since September, the main terminal demand for ABS has not yet shown the peak season level, but has continued the off-season trend. Home appliance manufacturers are gradually ending their high-temperature holidays, but the overall load position of downstream factories is slowly recovering. The recovery of terminal demand is slow, and the stocking operation is mainly based on weak demand. Traders have a low willingness to build warehouses, and their offers are subject to market conditions, resulting in a slower flow of goods. Overall, the demand side is not providing strong support to the market.
Future forecast
In early September, the domestic ABS price trend was relatively soft. Upstream three materials fell, two fell, and one remained flat, providing poor comprehensive support for the cost side of ABS. Recently, the load position of ABS polymerization plants has decreased, and the inventory of finished products has remained stable with small increases. The weak and rigid demand situation on the demand side continues, and market trading remains weak. Some enterprises in the future have plans to increase their load, and in the absence of peak season demand, the mismatch between supply and demand may be difficult to correct. It is expected that the ABS market will maintain a weak trend in the short term.
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