[FREE] China Morning Snapshot – 15 September 2021

The Dalian Commodity Exchange surged drastically during the first half of the trading day, ending the morning session with three digits hikes.

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

Compared to the previous day, the stocks at local producers’ warehouses fell just 15,000 tons to 755,000 tons as of 15 September 2021.

Following the sharp hike in the futures market, local suppliers implemented fresh hikes on both PP and PE cargoes, shrugging off the resistance from buyers. The bullish development is a result of the electricity consumption limitation that forces a series of coal-based plants in Yulin to slash operating rates between 50-60%. 

“Everyone is looking at the supply side at the moment. However, we fear that the same situation would happen to downstream manufacturers. In fact, local government in other regions have ordered the manufacturing sector to lower operating rates,” a trader commented. 

Meanwhile, the concerns do not stop arbitrage traders from off-take the cargoes, considering the increases in futures trading.