According to the monitoring of the Commodity Market Analysis System of Shengyi Society, as of January 24th, the price of 0 # zinc was 23730 yuan/ton, a slight decrease of 2.31% from the zinc price of 24290 yuan/ton on January 20th.

This week’s market analysis

This week, zinc prices have significantly fallen. Recently, due to the frequent specific comments on Trump’s tariff policies, the US dollar index has been hovering at a high level before finally closing higher, causing widespread pressure on the non-ferrous metal market.

Supply side

According to customs data, the import volume of domestic zinc concentrate increased slightly in December. At the same time, a large mine in Hebei has resumed production, further easing the situation of domestic raw material shortage. At present, smelters generally provide feedback that their inventory is relatively sufficient, and the processing fee for zinc concentrate may maintain a slight upward trend in the short term. However, with the depletion of inventory in smelters, it is still necessary to closely monitor the arrival of imported minerals at ports to assess their impact on raw material supply.

Demand side

As the Spring Festival holiday approaches, downstream enterprises are gradually entering the holiday stage, and the weakening of consumer demand in the zinc market has become inevitable. This trend will exert some downward pressure on zinc prices.

Despite the weakening of demand, domestic social inventory remains low in the short term. In addition, with the anticipation of the upcoming two sessions and the expectation of improved domestic demand, there is still some support for zinc prices. However, it is necessary to pay attention to the post holiday accumulation range to evaluate its impact on the trend of zinc prices. According to statistics, as of this week, the domestic social inventory has reached the lowest historical level of accumulated inventory before the Spring Festival.

comprehensive analysis

The effect bias caused by the uncertainty disturbance of macro factors, while the fundamentals of the zinc market are in the process of easing supply contradictions and weakening support. Therefore, it is expected that the zinc price will show a fluctuating and weak trend in the near future.

Recently, the prices of mainstream polyester staple fiber factories in China have remained stable. As of January 23, the average ex factory price of 1.4D * 38mm in Jiangsu and Zhejiang regions was 7318 yuan/ton. Mainly due to the weakening of support for polyester staple fiber caused by cost decline, the prices of traders have slightly decreased, and downstream textile enterprises are basically on holiday near the Spring Festival, resulting in sluggish transactions.

After taking office, Trump’s previous sanctions may be overturned, and his policies such as increasing US crude oil production, imposing tariffs, and trade risks tend to be bearish on oil prices, leading to a short-term pullback in crude oil prices. On January 22nd, the settlement price of the main contract for WTI crude oil futures in the United States was $75.44 per barrel, and the settlement price of the main contract for Brent crude oil futures was $79.00 per barrel.

PTA followed the decline in crude oil prices, and as of January 23, the average PTA market price in East China was 5048 yuan/ton, a decrease of 0.63% from the beginning of the week. At present, the PTA plant has limited changes, and the short-term supply of goods is still sufficient. Downstream polyester demand is off-season, with slow decline in production and weakened PTA demand.

The atmosphere of the Spring Festival is gradually intensifying, and the terminal stocking phase is coming to an end. Downstream production is gradually being suspended for holidays, and most customers have already stocked up in the early stage. The demand for pre holiday purchases is becoming increasingly light. The weaving industry in Jiangsu and Zhejiang has seen a decline in production to below 25%, and there is still room for further reduction.

Business analysts believe that the production of polyester staple fiber industry may continue to decline, and the supply of goods will gradually decrease. The cost has weakened, downstream factories have successively shut down for holidays, and the festive atmosphere is becoming stronger. It is expected that the price of polyester staple fiber will remain stable and decline.

According to the Commodity Market Analysis System of Shengyi Society, the PP market was mainly sorted out before the Spring Festival, with some brand products experiencing narrow price reductions. As of January 22nd, the mainstream offer price for wire drawing by domestic producers and traders is around 7558.33 yuan/ton, a decrease of -1.16% compared to the price level at the beginning of January.

Price trend

In terms of raw materials:

Recently, international crude oil prices have fluctuated and risen. Due to the extension of the OPEC+production reduction agreement until the end of the first quarter and the obstruction of some shipments, concerns about crude oil supply have risen. In addition, the recent low temperature weather in Europe and America has boosted demand, and various factors have stimulated the rise of the oil market. Overall, the upstream support of PP is strengthening. However, the purchasing power of propylene has been poor recently, and it has risen to a high level in the early stage due to the boost of external markets and raw materials, resulting in a significant decline in propylene in late January. It will take some time for propane to receive favorable transmission from raw materials, and it is still in a weak consolidation market at present. Overall, the PP raw material market fluctuated before the Spring Festival in January, and the cost value maintained positive guidance.

Supply side:

Domestic PP enterprises have resumed work and production, resulting in an increase in pre holiday load levels. In the early stage, the load of enterprises such as Sino Korean Petrochemical and Qilu Petrochemical gradually returned, and overall, the industry’s overall load increased by about 4% to 83%. The domestic weekly average production is over 730000 tons, and the PP shipment volume is flat. At the same time, newly put into operation devices are being produced one after another, and the market supply is abundant. Overall, the supply side provides moderate support for PP spot prices.

In terms of demand:

Before the holiday, the demand for PP tends to be weak and rigid. As the Spring Festival holiday approaches, the consumption level of woven bags such as fertilizers, cement, and rice has decreased, and the consumption level of plastic weaving has also declined. Terminal enterprises have basically completed pre holiday stocking, with a low willingness to continue purchasing and a tendency towards short-term buy as you go. Enterprises are gradually entering the holiday season, resulting in a decrease in workload. In addition, with the trend of year-end fund withdrawal in the market, overall, the demand side has shown weak performance.

Future forecast

The domestic PP market price consolidation was weak before the Spring Festival in January. Fundamentally speaking, the overall performance of upstream raw materials in supporting PP is still acceptable. The industry supply has increased. According to consumer feedback, as the Spring Festival approaches, businesses are gradually withdrawing from the market, and pre holiday stocking is gradually being completed. However, there is a lack of purchasing power in the market. In the short term, it is expected that PP prices will return to a calm pre holiday market with a relatively stable trend.

1、 Price trend

According to the monitoring of the commodity market analysis system of Shengyi Society, since mid January, the PVC spot market has reversed its decline and rebounded at the bottom of the price. As of the 21st, the average price of SG-5 PVC carbide method in China was 4966 yuan/ton, with a 2.52% increase in this round.

2、 Market analysis

Supply side: Since mid month, the PVC spot market has performed strongly, reversing the previous decline. Recently, with the continuous rise of crude oil and the driving force of PVC futures market, the linkage between the spot market is obvious, and prices continue to rise. The market performance has improved in terms of supply and demand. Recently, the PVC operating rate has remained stable, although some facilities have undergone temporary inspections and some fully operational enterprises have reduced their production. However, the impact on output is not significant, and the increase is mainly driven by the improvement of enterprise shipments. Combined with the improvement of external sentiment and the optimistic market atmosphere, export orders have increased, and traders are testing high reports.

In terms of inventory, the market has seen a temporary increase in transaction volume recently, and the continuous reduction of enterprise inventory is the main reason. This is mainly due to the concentrated inventory reduction and pre holiday light inventory operation strategy of enterprises since January. But the social inventory has slightly increased, and there is still some supply pressure in the market.

Cost side and demand: Since January, the price of calcium carbide in the market has remained stable, and the stabilization has brought certain benefits to downstream PVC. In addition, the residual temperature of downstream procurement before the holiday supported market demand, but the current peak of procurement is gradually coming to an end, and downstream consumers generally have a resistance to high priced goods, which to some extent suppresses the continued rise of PVC prices. As of now, the quotation range for PVC SG5 electric aggregate in China is mostly around 4900-5050 yuan/ton.

3、 Future forecast

The PVC analyst from Shengyi Society believes that as the holiday approaches, the trading volume in the PVC spot market is gradually weakening, and downstream companies are gradually suspending work and holidays. Demand is weakening, and market transactions are expected to decline. Most of the current rise is driven by the futures market and policies. Although traders are helping to speculate on the rise, the weak fundamentals of the spot market have led to a sustained upward trend.

1、 Price trend

According to the commodity analysis system of Shengyi Society, the price of soda ash has been steadily adjusted this week. As of January 19th, the average market price of soda ash was 1494 yuan/ton, which is the same as the price of soda ash on January 13th at 1494 yuan/ton, and a decrease of 2.86% compared to the previous month.

2、 Market analysis

This week, the soda ash market is running weakly and steadily. The market equipment is running smoothly, and the inventory pressure of soda ash manufacturers still exists. They maintain active shipment and the downstream market has slightly increased. However, the main consumption of inventory is limited, and the demand for soda ash is limited. The market trading atmosphere is still acceptable, and there is a game of supply and demand in the market. The soda ash market is stable and wait-and-see.

As of January 19th, the reference price for the soda ash market in East China is around 1380-1500 yuan/ton for light soda ash, with stable prices; The reference price for the soda ash market in Central China is around 1330-1480 yuan/ton for light soda ash, with a stable price.

According to the commodity analysis system of Shengyi Society, the downstream glass market is operating strongly. From January 13th to 19th, the price of glass increased from 16.25 yuan/square meter to 16.48 yuan/square meter, an increase of 1.42%. The operating rate of the glass market did not change much in the latter half of the year, and downstream market entry enthusiasm was good. Manufacturers shipped smoothly, and the market destocking increased, resulting in a strong upward trend in glass prices.

Future forecast: Currently, the inventory level of domestic soda ash market is still high, and spot alkali factories maintain active shipments. Downstream stocking sentiment before the holiday is average, and companies are following up on demand when entering the market. Sales pressure still exists, and the market supply is strong and weak. In the short term, soda ash will continue to operate weakly and steadily. Specific attention should be paid to downstream demand follow-up.

According to the Commodity Market Analysis System of Shengyi Society, from January 12th to 17th (as of 15:00), the average price of methanol in East China ports in the domestic market fell from 2739 yuan/ton to 2695 yuan/ton, with a price drop of 1.58% during the period, a month on month increase of 3.12%, and a year-on-year increase of 11.40%. The domestic methanol market rose and then fell back. At the beginning of the week, driven by the rise in crude oil prices, the domestic methanol market strengthened, but after reaching a high level, the market was generally buying gas. Later, with the increase in shipping costs, production companies offered discounts and shipped, causing the domestic methanol market price to fall.

As of the close on January 17th, the closing price of methanol futures on the Zhengzhou Commodity Exchange has fallen. The main contract 2505 for methanol futures opened at 2621 yuan/ton, with a highest price of 2628 yuan/ton and a lowest price of 2583 yuan/ton. It closed at 2604 yuan/ton in the closing session, a decrease of 35 yuan/ton or 1.33% from the previous trading day’s settlement, with a trading volume of 786645 lots and a holding volume of 739107 lots, with a daily increase of -30649.

On the cost side, although there has been a slight reduction in supply from production areas, the daily consumption of terminal power plants has been slow to rise, and high coal reserves have accumulated. The market’s enthusiasm for coal procurement is poor, which has suppressed the driving force of coal price increases. The cost of methanol is influenced by negative factors.

Demand side, downstream formaldehyde: formaldehyde demand has significantly decreased; Downstream dimethyl ether: Increased demand for dimethyl ether; Downstream MTBE: Increased demand for methanol; Downstream chlorides: Increased demand for methanol; There is currently no plan to shut down or start the acetic acid plant, and there is not much change in demand. The impact of methanol demand is mixed.

On the supply side, the overall recovery exceeds the loss, resulting in an increase in capacity utilization. Negative factors affecting the methanol supply side.

In terms of external markets, as of the close on January 16th, the closing price of CFR Southeast Asia methanol market was 361.00-362.00 US dollars per ton. The closing price of the US Gulf methanol market is between 120.00 and 121.00 cents per gallon; The closing price of FOB Rotterdam methanol market is 417.50-418.50 euros/ton, down 7 euros/ton.

Future forecast: Traditional downstream demand is expected to gradually decline due to the upcoming Spring Festival holiday, and MTO demand may not change significantly. Attention should be paid to fluctuations in freight rates and downstream stocking situation. The methanol analyst from Shengyi Society predicts that the domestic methanol spot market will mainly experience narrow fluctuations.

According to the commodity market analysis system of Shengyi Society, the price of polyester filament has slightly increased this week,. On January 17th, the mainstream polyester filament factories in Jiangsu and Zhejiang quoted POY (150D/48F) at 7100-7300 yuan/ton, polyester DTY (150D/48F low elasticity) at 8300-8500 yuan/ton, and polyester FDY (150D/96F) at 7500-7700 yuan/ton, with a shift in focus.

The extremely cold weather in Europe and America has stimulated fuel demand, and the United States has announced a new round of sanctions against Russia. Market concerns about supply have intensified, and US crude oil inventories have significantly decreased. International oil prices have risen sharply, and the cost side has shown strong performance. Coupled with the increase of filament maintenance and production reduction devices, market supply continues to decline. Enterprises have repeatedly raised prices in line with costs, and the market center of gravity has fluctuated upwards. However, due to downstream enterprises gradually stopping for holidays and having sufficient stock in the early stage, the enthusiasm for entering the market is poor, and the level of filament production and sales data is weak. This week, the average industry operating rate of polyester filament was about 83.42%. Multiple filament devices in the filament market were shut down for maintenance, resulting in a significant decline in market operating rate. As of this Thursday, POY inventory is around 4-6 days, FDY inventory is around 10-13 days, and DTY inventory is around 15-19 days.

The demand side is difficult to sustain, but cost and supply side support still exist. There is no risk of a decline in the filament market price. Next week is the last week before the Spring Festival holiday, when more workers will return home and logistics shutdowns will increase. It is expected that on-site trading will almost come to a standstill, and downstream operating rates will drop to freezing point. The demand side is difficult to sustain, but cost and supply side support still exist, and there is no risk of price decline in the filament market.

Overall, it is expected that the polyester filament market will operate with a strong cost logic next week, with limited fluctuations. The price range for POY150D/48F polyester filament in Zhejiang region is expected to be 7300-7400 yuan/ton.

According to the analysis system of Business Society, the price at the beginning of 2024 was 798 yuan/ton, and the price at the end of 2024 was 827 yuan/ton, with a price increase of 3.63%. The highest point of the annual price occurred on October 25th, at a price of 1041 yuan/ton, and the lowest point of the annual price occurred on January 12th, at a price of 782 yuan/ton, with a maximum amplitude of 33.12% throughout the year.

A brief review of the price trend of caustic soda in 2024 shows that the price of 32 liquid caustic soda did not fluctuate significantly in the first three quarters of 2024, and the price in the fourth quarter was like a roller coaster. From the first quarter to the third quarter of 2024, the price of caustic soda will remain around 750-850 yuan/ton. At this stage, there will be no maintenance of the caustic soda unit, and downstream demand will mostly be purchased on demand, which is more in line with the trend of caustic soda prices.

In the fourth quarter, after entering October, the price of caustic soda began to fluctuate. The price of caustic soda first rose and then fell. At the beginning of October, the average market price of caustic soda was around 833 yuan/ton, and then in mid to late October, the average market price of caustic soda was 937 yuan/ton, with a price increase of 12.48%. Afterwards, caustic soda entered a downward channel, and as of the end of the year, the average market price of caustic soda was around 800 yuan/ton. The specific reasons are as follows: one is due to the maintenance of the caustic soda unit, the supply is tight, but downstream demand has increased to some extent, resulting in an increase in caustic soda prices. However, after entering December, the price of caustic soda has declined mainly due to sufficient supply and weak demand for alumina in the main production areas, which has led to the continuous reduction of prices in Shandong and other regions, resulting in a consolidation of the decline.

From the annual price comparison chart of caustic soda, it can be seen that the highest historical price of caustic soda occurred around mid November 2021, with a price of around 1820 yuan/ton. The highest price in 2024 is around 1041 yuan/ton. The highest point of caustic soda prices this year did not break through historical highs. From the annual price comparison chart of caustic soda, it can be seen that in 2024, the price increased by July and decreased by 5 months. The largest increase was in October, reaching 24.49%, and the largest decrease was in December, reaching 19%.

The trend of caustic soda and soda ash is basically the same. The caustic soda fluctuated within the first three quarters, rising in the fourth quarter and then falling. In the first three quarters, the price fluctuated around 3300-3500 yuan/ton, and in the later four quarters, the price rose and then fell. The main reason for the increase in the fourth quarter is the maintenance of caustic soda manufacturers, which has led to an increase in downstream demand and a rise in caustic soda prices. However, with the increase in supply in the later period, downstream demand has weakened and caustic soda prices have declined.

Market forecast: supply side

In 2024, China’s caustic soda production capacity will be 48.45 million tons, an increase of 3.01% compared to the previous period. Affected by the increase in production capacity, the production of caustic soda from January to November has significantly increased compared to the same period last year. According to data from the National Bureau of Statistics, the domestic production of caustic soda from January to November 2024 was 39.81 million tons, an increase of 6.82% compared to the same period last year at a regular price of 2.54 million tons. The expected production in 2024 is 42 million tons.

The effective production capacity of caustic soda is expected to reach 52.23 million tons by 2025, with an estimated capacity growth rate of 7.16%. Overall, the caustic soda industry is still in a capacity expansion cycle.

The data predicts that the domestic consumption of caustic soda in 2024 will be 38.2332 million tons, an increase of 1.9412 million tons compared to last year. In 2025, downstream production capacity such as alumina, pulp, and new energy will be released, and the demand for caustic soda will still increase. In 2025, the alumina industry is expected to experience a peak in production, with a planned production capacity of 12.8 million tons, equivalent to an increase in demand for caustic soda of approximately 1.92 million tons.

Downstream demand aspect

There are many downstream consumption areas for caustic soda, mainly including alumina, printing and dyeing chemical fibers, chemical industry, light industry, papermaking, petroleum, etc. Among them, alumina is the largest consumption area, accounting for nearly 32%; Printing and dyeing chemical fiber accounts for 17%, while chemical industry accounts for 14%, ranking second and third respectively. The other industries are relatively scattered, accounting for less than 10%. In 2024, the price of alumina will gradually strengthen, supporting the rise in caustic soda prices in the fourth quarter of the year. In 2024, 7.05 million tons of domestic alumina will be put into production, with an increase of 550000 tons in the first quarter, 3.65 million tons in the second quarter, 1.5 million tons in the third quarter, and a planned increase of 1.35 million tons in the fourth quarter. According to data from the National Bureau of Statistics, the cumulative domestic production of alumina from January to November 2024 was 78.09 million tons, an increase of 2.49 million tons or 3.3% compared to the same period last year. The increase in non aluminum demand is limited, and the pulp market will continue to be sluggish in 2024, with 2.3 million tons of new production capacity put into operation, equivalent to approximately 320000 tons of caustic soda demand. In 2025, the demand for pulp converted to caustic soda will increase by about 180000 tons. From the perspective of the textile industry, the operating rate of adhesive short fiber enterprises will be relatively high in 2024, and the new energy industry will also be the main growth point of caustic soda demand in 2024. In 2025, the country will continue to provide strong support for the new energy industry, which will also provide support for caustic soda demand.

Import and export aspects

China is a net exporter of caustic soda, and overall its dependence on imports and exports is not high. For the domestic market, imports and exports are only one of the ways to balance supply and demand. According to data from the National Bureau of Statistics, the import volume of caustic soda from January to November 2024 was 6259 tons, the export volume of caustic soda from January to November 2024 was 2.3 million tons, and the export volume in 2024 was about 3 million tons.

Summary:

On the supply side, production capacity continues to grow, presenting an overall situation of loose supply. On the demand side: According to the 2025 production capacity data of downstream alumina, there is a production capacity of over 12.8 million tons that needs to be put into operation, and there is a certain increase in downstream demand for caustic soda. In terms of import and export, by 2025, there will be new production of overseas alumina (4-5 million tons). It is expected that caustic soda exports will increase by 2025. In 2025, we will usher in a dual growth pattern. The demand is mostly concentrated in the first half of the year, while the supply is concentrated in the second half. Therefore, the price of caustic soda may rise in the first half of the year, and the price in the first half of the year may be better than in the second half. The overall caustic soda concentration in 2025 may be higher than that in 2024.

The domestic phenol market has continued to rise, with major mainstream markets increasing by around 150-250 yuan/ton during the week. Factories have also actively increased their prices, with Yangzhou Shiyou, Blue Star Harbin, Lihua Yiwei Yuan, and Longjiang Chemical raising their quotes.

According to data monitored by Shengyi Society, the domestic phenol market price was 7845 yuan/ton on January 14th, with a 2.89% increase this week.

At present, the high cost and average price of phenol, coupled with tight spot supply, support market growth. Terminal enterprises are slightly cautious in procurement, but there has been a significant increase in on-site inquiries. Some enterprises are also actively preparing for pre holiday stocking. This week, the main demand is still for essential goods, and there may be inventory demand from terminal factories in the second half of the month, with trading volume to be released. As of the 14th, the phenol offers in various mainstream markets across the country are as follows:

Region/ Quotation on the 14th/ Zhou’s ups and downs

East China region/ 7780./ 250

Shandong region/ 7800./ 200

Surrounding areas of Yanshan Mountain/ 7800./ 200

South China region/ 7900./ 250

From the perspective of cost, average price, and supply and demand fundamentals, phenol prices are cautious. Next week, we need to focus on the demand situation and pay attention to the market’s actual order negotiations.

1、 Price trend

According to data monitored by Business Society, as of January 14th, the average quotation price of domestic high-quality DMF enterprises was 4260 yuan/ton. Recently, DMF prices have been mainly strong, with a narrow upward trend, and the overall market supply and demand are balanced.

2、 Market analysis

DMF prices remain stable and are approaching the end of the year. Downstream demand for DMF is average, and the overall market is running slowly, with rigid procurement as the main focus and high inventory levels. The overall market is mainly fluctuating, with a slight shift in focus.

In terms of cost, there is a clear contradiction between methanol supply and demand, with methanol prices operating in a narrow and strong range, resulting in an increase in operating rates. Downstream losses have intensified, and the load of methanol plants has been affected. The decline in international methanol supply has driven up domestic methanol prices, resulting in sluggish downstream consumption of methanol and slow overall market output.

3、 Future forecast

DMF analysts from Shengyi Society believe that the DMF market is expected to operate narrowly and strongly in the short term, with limited upward potential.