China Morning Snapshot – 23 August 2021

September delivery contracts on Dalian Commodity Exchange surprisingly rebounded on the first trading day of the week following the steep reductions end of last week.

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

Total inventories at Sinopec and CNPC’s warehouses piled up 75,000 tons throughout the weekend to 775,000 tons as of 23 August 2021.

Although local buyers cautiously return to the market to make small replenishment following the firmer futures market, the general trading sentiment has yet to show major improvement. Traders are willing to negotiate with serious buyers to push for month-end sales, now that the export window is closing.

“Because of the high shipping costs, we need the price gaps to widen by at least another $20/ton in order to offer to the export ground again. We think local buyers understand the situation and tend to press for large discounts,” a trader commented.