Analysis and forecast of the domestic spot plastics market in 2016

Trend review: Since the first quarter to the third quarter of this year, the domestic PVC market has changed its weakness in recent years, and the price has risen sharply, and exceeded the 8,000 yuan / ton mark, becoming a new high in the past five years
.
The increase in PVC prices has greatly eased the operating pressure of upstream enterprises, and the 60 key enterprises in the statistics, from January to October, accumulated profits of 2.
01 billion yuan, changing the loss of the same period last year, while key listed companies such as Sanyou Chemical, Zhongtai Chemical, and Hongda Xingye all saw a year-on-year increase in profits in the third quarter
.
In the fourth quarter, most of the pre-maintenance equipment in the PVC spot market basically resumed work, and it is expected that the market operating rate will rebound, supply will increase, and prices will
recover.
Until mid-December, near the New Year's Day and Spring Festival holidays, prices fell slightly
.

Market analysis: In the first quarter, the state introduced a variety of de-inventory such as reducing deed tax, demolition, etc.
favorable real estate policies, because the downstream of PVC is pipe building materials products, mainly relying on real estate to drive consumption, so the de-inventory policy boosted the price of
PVC.

In the second quarter, the PVC market also expected the UK to remain in Europe, optimism boosted the market, commodities were strongly supported by the upside, and the domestic PVC market rose
sharply.
Domestically, the profit of China's industrial enterprises in May increased by 3.
7% year-on-year, and the efficiency of industrial enterprises continued to show positive changes
.
At present, PVC market prices are supported by rising factors, and PVC fundamentals have risen
slightly.

In the third quarter, the domestic PVC market had a good atmosphere, supported by the continuous surge in futures, the spot PVC market was boosted, the phenomenon of low-price replenishment in the middle and downstream increased, and the trading volume increased
.
Forced by the impact of the new transportation regulations, the arrival of goods in East and South China is limited, and traders continue to increase prices in limited quantities
.

In the fourth quarter, the market demand side is gradually shrinking, especially limited by high-priced PE raw materials, and the price of terminal products lags behind, corporate profits are squeezed, downstream signs of replenishment are not obvious, just need to purchase is still the mainstream, downstream plastic products production growth rate slowed down
for four consecutive months.

On the whole, all PVC manufacturers in the country are expected to achieve profitability this year, and there should be no excess
demand for the current annual output of more than 1,600 tons.
However, the production capacity of more than 2,300 tons corresponds to the excess of downstream demand
.
And downstream customers obviously resist excessive prices, which will affect the healthy development of
the entire industry.
In addition, coal prices are expected to be controlled in 2017, so PVC prices will fall
back in the future.
Therefore, it is necessary to carefully grasp the general trend
of the PVC market next year.