China Morning Snapshot – 03 August 2021

The futures market extended the weakening trend following the movement on the energy complex as traders monitor the fast-spreading delta variant in China that threatens demand.

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

Total inventories at Sinopec and CNPC’s warehouses dropped 20,000 tons to 740,000 tons as of 03 August 2021. (Correction: The total stocks were at 760,000 tons on 2 August 2021. The previous Snapshot reported at 790,000 tons.)

Two consecutive days of price reductions seem to satisfy buyers, resulting in a more active trading sentiment on the second day of the week. Sources said that manufacturers, especially in the Eastern China region are running low on stock-on-hand, and tend to secure cargoes at the lower end of the overall price range. 

The flare-up in the number of COVID-19 infection cases in China triggers more stringent control of cross-province logistics, which might cause delays in delivery or higher delivery costs moving forwards.