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The price trend of domestic PVC raw materials after the holiday

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According to the overall market trend, the overall price center of PVC plastic raw material still moves upward in January. Up to now, the price of east China sg-5 electrolite has reached 6,700-6,800 yuan/ton, the average price in January is about 6,612 yuan/ton, compared with the increase of about 176 yuan/ton in December of 2017, the increase is about 2.73%. The main reason for the rise in PVC prices in January was the recent sharp rise in PVC futures, with the highest price close to 7000 yuan/ton, which was followed by the spot market. Early January, PVC tight trading range is given priority to, just need to moderate with the downstream is given priority to, the current trading situation stalemate, downstream of the late right amount stock up on dips, trading conditions improve, but near the end of the month, spot prices showed a rising trend, downstream stock up enthusiasm for the formation of negative influence, so trading again turned pale.

For the period before the Spring Festival, we believe that the market changes are limited and the high position is mainly settled. This year's Spring Festival holiday time is in the middle of February, the general downstream stocking time before late January has been completed, the latest time is early February. This year is special because the market price is so high that it has not fallen back to the expected price of goods in the downstream storage. In the late middle and late middle period, the spot price fell moderately and was relatively low, and some downstream consumers were able to buy goods at low prices. However, the price of PVC rose in the late part of the year, and the downstream consumers showed less enthusiasm for stocking.

At present, the price of east China market has reached 6,700-6,800 yuan/ton. At this price, the downstream side thinks that there is no strong need to prepare goods, and the risk of stocking is high. Basically, we wait until next week to see the market situation and make a choice. We think first this time, the futures price is not only, the spot is hard to have to fall, even if futures, spot fell space is limited, as traders, the recent procurement cost is higher, the hands of the spot is not much more special, not depreciate the necessity of the shipment, even if the hand is part of the supply of goods, also within the normal range, in this case, the trader's basic price offer, at most slightly on the shipment, however the downstream for that price is not accepted, so the basic first is traded flat, haven't changed much.

For the post-holiday market, we believe that the probability of price rise is relatively high, mainly based on the following reasons:

On the one hand, at present, upstream enterprises mainly focus on pre-sale and actively ship products. The basic pre-sale time is 7-15 days, and some pre-sale time has reached the middle of February. Although the downstream shutdown in February is mostly closed and the demand is flat, it is expected that the upstream enterprises will have some tired warehouses in February, but the inventory pressure is not obvious. In the inventory pressure is not obvious, the upstream icbc will basically price run.

Recently, on the other hand, the upstream booking fair, ex-factory price increases continuously, huang goods trade cost is higher, the upstream enterprise response, ready for the enthusiasm of the downstream terminal is poorer, most of the supply of goods or sell to traders, huang that trade costs are relatively high. The late supply of goods sent in succession, the upper part inventory transferred to the hands of traders. In the case of high replenishment cost, if there is shipment pressure after the holiday, and there is an earlier low supply of goods, the price or deposit to make up the profit space, but the high replenishment of goods, the fall space is limited.

Third, the downstream current inventory enthusiasm is not strong, even if some of the inventory, inventory is not large. No goods are prepared before the holiday, and the downstream starts to work after the holiday, and the demand begins to recover. In this case, the downstream goods are already in demand, and if the price of upstream and traders remains firm, the downstream passive acceptance is more likely.

On the whole, we believe that it is more likely that PVC prices will go up after the holiday, but they will not go up immediately after the holiday. Because traders in the market, earlier than the downstream factory at this time a more critical issue is the downstream specific resume work time, if late February downstream began to return to work, the traders delivery pressure is small, but if the downstream pushed back to early march, the late February this time, traders inventory pressure, as the late start, downstream to upstream tired library, the longer time and inventory pressure increases, a hierarchical overall pressure increases, the market or stock downward space, but space will not be too big.