China Morning Snapshot – 23 February 2021

May delivery contracts for both PP and LLDPE trades sluggishly this morning, which players attributed to a technical correction following several days of hitting new high levels.

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

Total inventories at Sinopec and CNPC’s warehouses reduced 20,000 tons day-on-day to 890,000 tons as of 23 February 2021. (Correction: Total stocks were at 910,00 tons on 22 February 2021. The previous snapshot reported at 920,000 tons.)

Local sentiment has yet to see major improvement on the second trading day of the week. Purchasing activities are weak though suppliers continue to implement fresh price hikes to reflect the low inventory pressure.

“We are willing to negotiate with serious buyers, however, deals are very thin this morning. Prices have firmed up too aggressively, which manufacturers are unable to accept at the time businesses haven’t recovered from the holiday,” a trader said. It appears that some minor corrections are necessary to lure customers back to make replenishment.