18 January 2023- Shenhua's coal-based PP and PE Auction Results

Shenhua Baotou Coal Chemical Co has concluded the auction session for its coal-based PP and PE cargoes on 18 January 2023. The following table showed the details of the auction results for prime grade only: 

Trading activities on the Shenhua auction platform remain resilient thanks to the presence of enthusiastic arbitrage traders, who are leveraging the rising futures contracts on the Dalian Commodity Exchange before the long holiday. 

In fact, for the first time since October 2022, PP futures on Dalian Commodity Exchange surged above the CNY8000/ton threshold, creating an eyewatering price gap between the two trading platforms. 

Compared to the previous auction session, deal prices for both PP and LLDPE held largely unchanged, which in addition to the steady auction volume depicts Shenhua’s selling strategy of depleting more cargoes instead of maximizing margins.  

Background: 

Shenhua Baotou Coal Chemical Co is currently the largest coal-based polyolefins producer in China, operates under four subsidiaries, namely: Shenhua Xinjiang Coal-based New Materials Project, Shenhua Yulin Energy Co Ltd, Shenhua Baotou Coal Chemical Co Ltd and Shenhua Ningxia Coal Industry Group (Ningmei).

The company has an annual capacity of 2.65 million tons/year of PP, 750,000 tons/year of HDPE/LLDPE and 570,000 tons/year of LDPE.

Shenhua Baotou Coal Chemical Co is active in spot trading, while also conducting the daily auction for its cargoes daily between 10AM to 12PM on the official online platform that specifically designed for this purpose: https://www.e-chnenergy.com