[PE Weekly Outlook] PE Prices Expected to Fluctuate and Slightly Decline This Week

1. Focus Points

1 Cost side: The market remains concerned about the supply risks brought by the instability of the Russia-Ukraine situation, combined with the continuation of U.S. sanctions on some oil-producing countries, leading to a rise in international oil prices. NYMEX crude oil futures for the November contract rose by $0.82 per barrel to $62.55, a month-on-month increase of 1.33%; ICE Brent futures for the December contract rose by $0.80 per barrel to $66.25, a month-on-month increase of 1.22%. 。

2 Current parking device: Currently, there are 29 sets of polyethylene facilities related to parking devices, and there are no new facility maintenance activities.

3 Yesterday's market review: Yesterday, the domestic polyethylene market saw a price decline of 1-4 yuan/ton. Following the news of the Federal Reserve's 25 basis point rate cut, market expectations have eased, leading to a significant correction in the market. Additionally, with the National Day holiday approaching, suppliers are actively reducing inventory. However, the downstream demand for purchases remains limited, resulting in suppliers offering discounts to facilitate sales, which in turn has caused prices to fall.

Core Logic: Inventory pressure rises, prices fluctuate and slightly decline.

Section 2: Price List Form

3. Market Outlook

Polyethylene prices are expected to fluctuate slightly downwards this week. Key points to watch: 1. Cost aspect. Oil-based cost support is expected to weaken, while coal-based costs remain largely unchanged; 2. Supply side. Market supply involves planned restarts of facilities such as Lianyungang Petrochemical, Sinochem Quanzhou, and Bora LyondellBasell, with only the addition of Zhenhai Refining and Chemical's planned maintenance facility anticipated to increase. The total production this week is expected to be 678,500 tons, an increase of 35,800 tons compared to last week; 3. Demand side. The overall operating rate of various PE downstream industries is expected to decrease by 3.14% this week. Some downstream factories will have shutdowns and holidays, but according to past patterns, post-holiday agricultural film demand typically enters a concentration period. To ensure continuous production after the holiday, downstream enterprises often have varying degrees of stockpiling demand, thus raising polyethylene demand. Overall, the market's destocking pressure is increasing, and more sellers are likely to offer discounts to move goods, potentially leading to slightly lower prices.

4. Data Calendar