China Morning Snapshot – 17 May 2021
China Morning Snapshot – 17 May 2021
Both PP and LLDPE contracts on Dalian Commodity Exchange opened the first trading day of the week on a weak note, however, the PP contract managed to regain some strength by the end of the morning session.
Details on the spot and futures prices are shown in the following table:
|
17 May 2021 |
Prices in CNY |
USD Equivalent |
Changes in CNY |
Changes in USD |
|
Combined and reported by CommoPlast |
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|
Dalian Commodity Exchange (Mid-day closing) |
||||
|
PP 2109 |
CNY 8801 |
USD 1209 |
+CNY 11 |
+USD 2 |
|
LLDPE 2109 |
CNY 8115 |
USD 1115 |
-CNY 10 |
-USD 2 |
|
Spot Domestic Prices (EXW China, Cash equivalent) |
||||
|
PPH (East China) |
CNY 8800-8900 |
USD 1209-1223 |
Stable |
Stable |
|
LLDPE (North China) |
CNY 8200-8450 |
USD 1127-1161 |
-CNY 50 |
-USD 8 |
|
**All USD equivalent prices are exclusive of 13% VAT |
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Total inventories at Sinopec and CNPC piled up 55,000 tons from last Friday to 800,000 tons as of 17 May 2021.
Sentiment in the early trading hours of the first trading day of the week is soft with limited transactions observed. Customers prefer to wait on the sideline for clearer market development before making decisions.
One of the most concerning issues in China market is the electricity shortage in Guangzhou as summer electricity usage surges. Market sources reported that the municipal government has advised the manufacturing sector to adjust production plans to operate 5 days a week to avoid overstretching the power grid. On 17 May 2021, all manufacturers would only be allowed to operate from 11PM to 8AM the next day.
The development is expected to affect demand.