CommoPlast | Article - 10 October 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 10 October 2023. The following table showed the details of the auction results for prime grade only:

Product	Auction Volume	Deal Volume	Auction Prices		Deal Prices		Deal %
Product	Auction Volume	Deal Volume	CNY/ton	USD/ton	CNY/ton	USD/ton	Deal %
*Combined and reported by CommoPlast*
Homo-PP	1800	486	7450	$904	7450-7610	$904-924	27.0%
PP Fiber	-	-	-	-	-	-	-
PPBC	255	255	7700	$935	7750-7790	$941-946	100.0%
LLDPE	700	90	7900	$959	8150-8180	$989-993	12.9%
LDPE heavy duty	-	-	-	-	-	-	-
HDPE	500	0	7770	$943	-	-	0.0%
Auction and Deal volumes are in tonnage All USD equivalent prices only exclude the 13% value-added tax (VAT). They have not taken into account other costs that might incur in the selling process, i.e. import duty, customs clearances.

Chinese bidders continue to wait on the sideline despite the strong rebound on the energy complex. In order to entice demand, Shenhua further slashed auction prices by CNY130/ton for homo-PP and CNY30/ton for LLDPE. Still, transactions were disappointing.

Market participants become more reluctant to proceed with new purchases on renewed concerns over the macroeconomic outlook.

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