China Morning Snapshot – 01 September 2021

Major contracts for January 2022 delivery opened the first trading day of the month on a weak note but regained some strength by the end of the morning session on speculation of a forced shutdown at a couple of coal-based plants. 

Details on the spot and futures prices are shown in the following table:

Due to the closing for month-end in the previous day, total stocks at Sinopec and CNPC’s warehouses piled up 35,000 tons to 760,000 tons as of 1 September 2021.

The market has been heavily focused on the shutdown at Datang Duolun Coal Chemical’s 460,000 tons/year PP plant in Inner Mongolia as a result of the coal consumption control. However, a source close to the company informed CommoPlast that it has yet to decide on the shutdown date and the plant might have to remain offline for 45 days instead of 30 days as circulated in the market. 

“We have to monitor if the government would force other coal-based plants to stop operations, too. Some of our customers are more active in asking for PP cargoes, which is a good sign,” a trader commented.