Aluminum prices rise in October

After the holiday, aluminum prices rose in October, showing strong performance. According to the Commodity Market Analysis System of Shengyi Society, as of October 11, 2024, the average price of aluminum ingots in the East China market in China was 20720 yuan/ton, an increase of 3.70% from the market average price of 19980 yuan/ton on September 26.

Aluminum prices are expected in October

The reasons for the continued rise in aluminum prices in October are as follows:

1. Domestic macro positive news is released, and policies are boosting the non-ferrous sector. The central bank has proposed further interest rate cuts and reserve requirement ratio cuts to release liquidity, while also creating a shift towards refinancing to guide listed companies to repurchase and increase their holdings of stocks. At the real estate level, it is proposed to lower the interest rates of existing housing loans and unify the minimum down payment ratio for housing loans. Vice Minister of Finance Liao Min: We will actively study and introduce measures that are conducive to the stable development of the real estate industry. Make good use of special bonds to acquire existing commercial housing and use it as affordable housing in various regions. We are urgently studying and clarifying the value-added tax policy that links the standards for ordinary and non ordinary residential properties. The positive expectations brought by domestic policies, coupled with the positive expectations of terminal demand, have driven aluminum prices to remain firm and improve emotionally. Under the guidance of policy direction, market confidence has returned and sentiment is unlikely to subside in the short term. It is expected that the policy will continue to boost positive sentiment in October.

2. The inventory is in a continuous state of destocking, and the daily production of Yunnan electrolytic aluminum enterprises on the supply side is high, narrowing the upward space. However, recently, Southern Power Grid announced that Yunnan electrolytic aluminum may lift power restrictions this winter and next spring, and downstream electrolytic aluminum in Yunnan is expected to not reduce production in the fourth quarter; Multiple downstream sectors on the demand side have experienced a rebound in operating rates, with electrolytic aluminum and aluminum rod inventories in a state of slight destocking. The expectations for the Golden September and Silver October are good.

3. The supply of raw alumina is tight and the price is high. The limited mining in China has led to a slow progress in the resumption of alumina production, making it difficult for the alumina operating rate to continue to rise. The price of alumina has risen rapidly and is relatively high, providing strong cost support for aluminum prices.

Potential risks of aluminum price loosening in October

Risk point: Import and export may be affected by foreign policy factors, and some of the US 301 tariff policies will take effect on September 27th. This includes a 100% tariff on Chinese electric vehicles, a 50% tariff on Chinese solar cells, and a 25% tariff on Chinese steel, aluminum, electric vehicle batteries, and key minerals.

According to the Commodity Market Analysis System of Shengyi Society, the toluene market continued to decline in September 2024. From September 1st to 30th, the domestic toluene market price fell from 6840 yuan/ton to 5890 yuan/ton, with a price drop of 13.89% during the period.

Early this month: The toluene market continued to operate weakly, with market prices fluctuating downward. The decline in the crude oil market has dragged down the weak mentality of the toluene market. In terms of supply, the overall inventory of toluene in East and South China was low this week. However, due to the downstream wait-and-see mentality, market trading is clearly sluggish. The main refineries have repeatedly lowered their ex factory prices, and local refining enterprises have continuously lowered their quotations. Downstream companies are observing and the purchasing enthusiasm is generally weak.

Late January: The toluene market continued to operate in a weak position. The market was boosted by the rise of crude oil around the Mid-Autumn Festival. The toluene market recovered slightly for a short time. Affected by the weak actual downstream demand, the increase in the callback range was limited. After the holiday, Sinopec’s ex factory prices continued to decline, dragging down market sentiment and causing a wide decline in spot market prices. The overall demand is weak, and the purchasing enthusiasm of the gasoline blending industry is low. Downstream demand is biased towards rigid demand, and under the influence of negative factors on the supply side, market prices continue to operate at a low level.

Cost wise: The crude oil market is declining, and this news is negative for international oil prices due to the easing of tensions in the Middle East. Global crude oil demand fell short of expectations, coupled with the end of the peak oil season in the United States, dragging down the crude oil market and causing a decline in crude oil market prices. The rise in crude oil market prices in the later stage of this cycle, coupled with the tense geopolitical situation in the Middle East and the Federal Reserve’s interest rate cuts, has boosted the crude oil market. Overall, the crude oil market has declined during the cycle. As of September 26th, international crude oil futures have fallen. The settlement price of the main contract for WTI crude oil futures in the United States is $67.67 per barrel. The settlement price of the main Brent crude oil futures contract is $71.09 per barrel.

Supply side: Sinopec’s toluene quotation has been lowered multiple times during the cycle, but there are slight differences in the amplitude of each underground adjustment. At present, the enterprise is operating normally, the production of equipment is stable, the products are mostly for personal use, and the production and sales are stable. As of September 27th, East China Company quoted 6000 yuan/ton, North China Company quoted 5800 yuan/ton, South China Company quoted 5850-5950 yuan/ton, and Central China Company quoted 5900 yuan/ton.

Demand side: The external market for xylene continues to decline, and the demand support for toluene is relatively weak

On September 30th, Sinopec Sales Company implemented a price of 7350 yuan/ton for xylene, a decrease of 700 yuan/ton from the price on August 30th, 2024. During this price cycle, PX prices in East China, North China, Central China, and South China continued to decline both domestically and internationally. As of September 27th, CFR China’s closing price was 842-844 US dollars/ton, a cumulative decrease of 85 US dollars/ton from 927-929 US dollars/ton at the end of August.

During this period, there was a significant decline in the Asian toluene market. As of September 27th, the Asian toluene market had a closing price of $751-753 per ton FOB Korea in October, a decrease of $63 per ton; The closing price of CFR China in October was 743-745 US dollars per ton, a decrease of 80 US dollars per ton.

Future forecast: From a cost perspective, the expected improvement in the crude oil market will boost market sentiment. At present, the overall inventory of toluene in the supply side is at a stable, medium, and low level, which is a certain positive boost to the market. The downstream market has performed poorly in terms of demand, maintaining the intention to purchase for essential needs, and the demand side remains weak. At the end of the month, Asian external prices rose, boosting market sentiment, and the toluene market slightly rebounded. However, overall, weak demand has constrained the upward potential of the toluene market. It is expected that the toluene market will continue to maintain a weak and volatile trend in the short term. Focus on downstream stocking situation in the future.

According to the Commodity Market Analysis System of Shengyi Society, as of September 29, 2024, the reference price of n-butanol in Shandong Province, China was 6800 yuan/ton. Compared with September 1 (reference price of n-butanol was 7116 yuan/ton), the price has decreased by 316 yuan/ton, a decrease of 4.45%.

From the Commodity Market Analysis System of Shengyi Society, it can be seen that in September, the overall market situation of n-butanol in Shandong Province, China, showed a fluctuating downward trend. In early September, the n-butanol market continued to decline, and the market center continued to move towards lower levels. As of September 15th, the n-butanol market price in Shandong region was based on 6666 yuan/ton, with a drop of 6.32% in the first half of the year.

In late September, after the Mid Autumn Festival, the n-butanol market ushered in a short recovery. In the post festival stage, some n-butanol units did not resume operation, and the overall operating rate in the site was reduced. The supply side provided temporary support to the market, and the market focus was moving up. However, the support provided by downstream demand to the market has generally improved. After the resumption of production, the n-butanol market has experienced a rapid decline. As of September 29th, the n-butanol market price reference is around 6700-6900 yuan/ton.

Market analysis in the future

At present, the trading atmosphere in the n-butanol market is mild, with some downstream companies stocking up before the holiday. The overall market demand has slightly improved, and shipments at low prices have also improved. The n-butanol data analyst from Shengyi Society believes that in the short term, the domestic n-butanol market will mainly operate with large stability and small movements, and the specific trend still needs to pay more attention to changes in supply and demand news.

The price of ethylene glycol decreased in September

In September, the price of ethylene glycol began to decline and stabilized at the end of the month. According to data from Shengyi Society, as of September 27th, the average price of domestic oil to ethylene glycol was 4525 yuan/ton, a decrease of 3.28% from September 1st.

On September 27, 2024, the operating price of ethylene glycol at the port was between 4500-4540 yuan/ton, and the basis of spot contracts did not change much during the day. In October, the basis quotation was+38 to+43 yuan/ton; The base price for November is+42 to+46 yuan/ton.

On September 27th, the price of coal to ethylene glycol remained stable, with prices in the northwest region ranging from 4180-4300 yuan/ton, including taxes.

On September 26, 2024, the external price of ethylene glycol was as follows: the landed price in China was $540/ton, and the landed price in Southeast Asia was $535/ton.

Overview of Ethylene Glycol Fundamentals

Cost wise: Saudi Arabia is preparing to abandon its unofficial oil price target of $100 per barrel and increase production to regain market share. Additionally, two OPEC+sources have stated that the organization will increase oil production in December. International crude oil production is expected to increase, and the cost of producing ethylene glycol from oil has loosened. Coal to ethylene glycol has recently stabilized due to the stabilization of coal prices and cost recovery, but its absolute value is still relatively low.

On the import side, ships that were delayed due to typhoon weather in the early stage have gradually docked at the port, and the recent arrival volume at the port has increased.

Port inventory: As of September 26, 2024, the total spot inventory of ethylene glycol in the main ports of East China was 553400 tons, a decrease of 119900 tons from the total spot inventory of ethylene glycol in the main ports of East China on August 29, which was 673300 tons; Compared with the total spot inventory of ethylene glycol at the main port in East China on September 23, which was 512600 tons, the inventory increased by 40800 tons.

Future expectations

Recently, the price of ethylene glycol has stopped falling and rebounded, mainly due to the positive domestic macro conditions driving up the price of coal, and the cost of coal to ethylene glycol has changed; In addition, the polyester sector has been affected by macro sentiment and has stopped falling and rebounded.

However, the cost of producing ethylene glycol from oil is still in a downward trend due to the influence of international crude oil prices, and there is no sign of a stop to the decline in the short term. In addition, there is an expectation of a weak peak season in downstream polyester demand, and it is expected that the price of imported ethylene glycol, which has a high correlation with futures, will have weak upward momentum. The domestic macro sentiment has a significant impact on current prices, and if international crude oil prices do not rebound, the price of ethylene glycol in October may mainly fluctuate weakly.

In this cycle (20240912-20240919), the cost side and demand side played a game, and the overall price of acrylic acid market showed a trend of oscillation and consolidation during the week. The atmosphere of negotiations in various regions was not lively. Although the overall supply and demand pressure was not high, the fundamentals still maintained a weak trend. As of September 25th, the reference price of acrylic acid was 6775.00, an increase of 0.37% compared to September 1st (6750.00).

In terms of cost

This week, the raw material propylene fluctuated within a narrow range, and enterprise quotations tended to be conservative, with little fluctuation in the cost of acrylic acid. Downstream factories flexibly purchase based on their actual needs, and transactions are relatively smooth for moderately priced goods; However, there is little interest in transactions with low prices, and the activity is slightly insufficient.

The mainstream transaction price of propylene in Shandong region is 6610 yuan/ton, a decrease of 10 yuan/ton from last week; In the Northeast region, it dropped to 6255 yuan/ton, a decrease of 10 yuan/ton; The price of propylene in the northwest region dropped by 50 yuan/ton to 6180 yuan/ton, with a significant decrease; As of September 25th, the reference price of propylene was 6690.75, a decrease of 3.98% compared to September 1st (6968.25).

In terms of demand

The price of butyl acrylate has decreased. This week, the butyl acrylate market has slightly declined, and the trading atmosphere in the market is quiet. Downstream manufacturers have a heavy wait-and-see attitude, and transactions are mainly dominated by first-time contract holders. The focus of butyl acrylate quotations is gradually shifting downwards, and the upstream cost support is also limited. In the short term, it is expected that the butyl acrylate market will continue to remain weak, and it is recommended to purchase according to demand.

In summary, the acrylic acid market is maintaining a stable operation, while the upstream acrylic acid market is fluctuating within a range. The listed prices of production enterprises are fluctuating, and the listed prices of acrylic acid manufacturers are temporarily stable. The trading atmosphere on the market is flat, and the overall production capacity is at a low level with limited fluctuations. The downstream market’s enthusiasm for receiving goods needs to be improved, and long-term contracts are mainly executed. The short-term market may continue to consolidate and operate.

This week (September 16-20, 2024), the adhesive short fiber market continued to maintain a stable trend, with manufacturers mainly fulfilling orders and prices remaining stable. The market price of the main raw material dissolving slurry is firm and stable, with cost support still remaining. There is no obvious sign of improvement in the “Golden Nine” market, and the demand in the terminal market is flat. Cotton mills mainly consume raw material inventory, and the atmosphere of observation in the market is strong. The overall flow rate of goods in the market is stable, and the market price of adhesive short fibers has not changed much. In the future, attention should be paid to the follow-up of new orders from downstream cotton mills.

According to the Commodity Market Analysis System of Shengyi Society, the price of viscose staple fiber remained stable this week (September 16-20, 2024). As of September 20th, the domestic factory price for 1.2D * 38mm adhesive short fiber is 13640 yuan/ton, which is the same as last week’s price.

Cost side support still exists

The upstream raw material end main material dissolution slurry market is strong and stable. As of now, the price of domestic dissolution slurry is around 7800 yuan/ton, the price of outer broad-leaved slurry is around 960 US dollars/ton, and the price of coniferous slurry is around 1040 US dollars/ton. The cost side of the adhesive short fiber market is still supported by favorable factors.

Stable supply, low inventory

The supply of adhesive short fiber industry is at a high level, and most manufacturers have stable equipment operation. The on-site operating rate is at a high level, and the current daily operating rate of the industry is around 84.79%. The early parking and maintenance equipment in Xinjiang has not been restarted yet, and the overall market supply is high. The inventory levels of various adhesive short fiber manufacturers are low, and the on-site supply is slightly tight. The supply side provides some upward momentum for the market.

The demand has not shown significant improvement

Although it has entered the traditional peak season for textile production in September, there is no obvious sign of improvement in the textile terminal market. Downstream yarn manufacturers have insufficient new orders, making it difficult to increase their enthusiasm for raw material procurement. Manufacturers are holding on to signing orders for essential needs, and the new round of orders on site is expected to take about a month. The recovery of demand is not as expected.

Future forecast

The upstream main raw material market price of viscose staple fiber may remain high, and the supply in the market is relatively tight. However, the new round of signing orders in the downstream market has basically ended, and the peak season has arrived. There is an expectation of an increase in the operating rate of human cotton yarn factories, which will drive the consumption of viscose staple fiber. Therefore, it is expected that the demand for viscose staple fiber may increase in the later stage, but it is difficult for the demand side to improve significantly in the short term. Viscose staple fiber manufacturers mainly deliver orders, and business analysts predict that the focus of the domestic viscose staple fiber market will remain stable in the short term, with little price fluctuation. The price is expected to be in the range of 13600-13700 yuan/ton.

The phthalic anhydride market has fallen this week

According to the Commodity Market Analysis System of Shengyi Society, as of September 13th, the price of phthalic anhydride produced by phthalic anhydride was 7362.50 yuan/ton, a decrease of 1.34% from the price of 7462.50 yuan/ton on September 6th. This week, the price of ortho xylene was quoted at 7400 yuan/ton, a decrease of 300 yuan/ton or 3.90% compared to last week. The cost of phthalic anhydride has decreased, and the phthalic anhydride market has declined. This week, the domestic price for ortho phthalic anhydride is 7200-7400 yuan/ton, while the domestic price for nano phthalic anhydride is 7100-7200 yuan/ton.

Supply side: tight supply of goods

Domestic phthalic anhydride plants operate at low loads, with frequent shutdowns of naphthalene phthalic anhydride equipment and low load operation of neighboring phthalic anhydride equipment. Phthalic anhydride manufacturers are experiencing a shortage of goods and queuing up for shipments, resulting in a tight supply of phthalic anhydride and increased upward pressure on its price.

The cost of raw material ortho benzene has decreased

According to the Commodity Market Analysis System of Shengyi Society, as of September 13th, the price of ortho benzene was 7400 yuan/ton, a decrease of 300 yuan/ton or 3.90% from the price of ortho benzene on September 6th, which was 7700 yuan/ton; Compared to early September, the price of ortho benzene decreased by 500 yuan/ton, or 6.33%, from 7900 yuan/ton. In September, the price of ortho phthalic anhydride fell again, and the cost of ortho phthalic anhydride decreased. There is significant downward pressure on ortho phthalic anhydride.

Demand side: DOP market trend rebounds

According to the Commodity Market Analysis System of Shengyi Society, as of September 13th, the price of plasticizer DOP was 8501.25 yuan/ton, an increase of 0.44% compared to the DOP price of 8463.75 yuan/ton on September 8th; Compared to September 1st at the beginning of the month, the DOP price dropped by 8726.25 yuan/ton, a decrease of 2.58%. DOP prices rebounded and rose this week. The prices of raw materials continue to decline, the profit margin of plasticizer equipment expands, and the gross profit of downstream DOP products increases compared to August. Driven by profits, downstream plasticizer companies are expected to increase their operating rates, leading to an increase in demand for phthalic anhydride.

Future forecast

According to the data analyst of Shengyi Society’s phthalic anhydride products, in terms of cost, the price of ortho xylene has dropped significantly, and the cost of phthalic anhydride has decreased; In terms of supply, phthalic anhydride manufacturers are operating at low loads, resulting in a tight supply of phthalic anhydride; In terms of demand, the downstream DOP market has rebounded, DOP manufacturers have increased production, and the demand for phthalic anhydride is expected to rebound. It is expected that the neighboring phthalic anhydride market will stop falling and rebound in the future.

1、 Price trend

According to data monitored by Shengyi Society, as of September 6th, the average price of industrial grade high-quality cyclohexane in China this week was 7833.33 yuan/ton. The price of cyclohexane remained stable this week, with slow overall market shipments and high inventory levels. Currently, downstream demand is weak, terminal demand is not as expected, and downstream demand is weak. Downstream purchases are mainly for essential needs, and businesses are adopting a cautious and wait-and-see attitude.

2、 Market analysis

In terms of cost, the fluctuation of upstream pure benzene prices is the main trend, with a weak decline. Crude oil prices have fallen, and buying gas has been stagnant. Recently, crude oil prices have continued to decline. According to industry insiders, the drop in oil prices to the lowest point of the year is mainly due to weak economic data, hindered exports, and other reasons.

3、 Future forecast

The cyclohexane analyst from Shengyi Society believes that it is expected that the market price of cyclohexane will remain weak and stable in the short term, with insufficient cost support and passive downstream purchasing.

According to the monitoring of the commodity market analysis system of Shengyi Society, the price trend of anhydrous hydrofluoric acid in China declined in August. As of August 30th, the benchmark price of hydrofluoric acid in Shengyi Society was 10800.00 yuan/ton, a decrease of -4.42% compared to the beginning of this month (11300.00 yuan/ton).

Raw material side: The price of raw material sulfuric acid continues to rise and only falls slightly towards the end of the month. The current situation of the game in the domestic fluorite industry still exists. Overall, the operating rate of enterprises has not changed much. Upstream mining is tight, backward mines will continue to be eliminated, and new mines will be added. Mineral investigation work is still difficult. In addition, the national department will carry out renovation of fluorite mines in the near future, and fluorite mining enterprises are facing increasingly strict safety and environmental protection requirements. In addition, the high temperature and rainy weather in the southern region have increased the difficulty of operating fluorite mines, and the shortage of raw materials has limited the operation of fluorite enterprises. The supply of fluorite sources is still tight, and the decline in fluorite prices is somewhat restricted. Some domestic enterprises’ facilities for hydrofluoric acid are still shut down and waiting for the market, resulting in limited release of hydrofluoric acid production, low industry profits, and increased losses. Overall, there is still pressure on production costs for enterprises, and the hydrogen fluoride market is weak and declining. According to the monitoring system of Shengyi Society, as of August 30th, the benchmark price of sulfuric acid in Shengyi Society was 340.00 yuan/ton, an increase of 30.77% compared to the beginning of this month (260.00 yuan/ton).

On the demand side: The downstream refrigerant market production demand is weakening, and air conditioning companies are entering the annual maintenance season. In addition, with the recent continuous rainy weather, refrigerant companies have poor stocking conditions and are not actively purchasing upstream products. Price cutting procurement, urgent need for replenishment.

Market forecast: In the near future, upstream sulfuric acid prices will continue to rise, and there will be significant pressure on the production cost of hydrofluoric acid. The downstream refrigerant industry has entered the off-season with weak demand, which has weakened the enthusiasm for purchasing hydrofluoric acid. It is expected that the price of hydrofluoric acid will remain weak and stable in the later period.

Isopropanol

Latest price: On August 27th, the average market price was 7590.00 yuan/ton.

Analysis points: On August 27th, the focus of the isopropanol market shifted downwards. In terms of upstream acetone raw materials, there is significant supply pressure, leading to a decline in market quotes. Affected the mentality of the isopropanol market, coupled with insufficient downstream demand follow-up, the overall trading performance of the market is poor, and the focus of on-site negotiations is still low, resulting in cautious actual market transactions. At present, the reference price in Shandong region is around 7400-7500 yuan/ton, and the reference price in Jiangsu and Zhejiang regions is around 7600 yuan/ton. The reference price of isopropanol in southern China is around 7700-7800 yuan/ton.

It is expected that the isopropanol market will remain cautious in the short term, with a weak and stable operation.