China Morning Snapshot – 29 December 2020

Dalian Commodity Exchange extended the weakening trend this morning, continue to shrug off the positive macro environment including the progressive vaccines, new stimulus package in the US, and Britain-EU trade deal.

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

Compared to the previous trading day, inventories at Sinopec and CNPC’s warehouses have digested 45,000 tons to 605,000 tons as of 29 December 2020. 

The larger reduction in the total inventories signals that customers might be returning to make small purchases as prices soften. However, sources are not having high expectations for the remaining of the week citing the long weekend holidays ahead.

On the positive side, the local government has withdrawn the red alert on the air pollution levels in the Northern China area, which means the manufacturing sector would be able to resume operation after the New Year holiday.