Demand follows slowly, LLDPE main contracts closed in a narrow range

News: 1.
The PE inventory of domestic polyethylene enterprises (oil + coal) in this cycle decreased by 3.
64%
week-on-week.
Among them, the PE inventory of coal enterprises fell by 9.
23%.

The total inventories of PE in the two barrels of oil fell by 1.
31% month-on-month and 3.
3%
year-on-year.
Traders' PE inventories fell in a narrow range, down 1.
75%.

Social inventories continued to fall significantly, forming a certain support
for prices.

2.
The domestic output of PE pipe materials in August decreased by 4.
36%
compared with July.
From January to August 2019, the domestic output of PE pipe materials increased by 25% compared with the same period in 2018 and 34%
over the same period in 2017.
The operating rate of domestic pipe downstream factories in August fell by 8%
compared with July.
In August, some areas were affected by typhoons, downstream demand continued to be sluggish, in September affected by the 70th anniversary of the National Day military parade, factories in some northern areas limited production or stopped, pipe peak season is not strong, although Dushanzi Petrochemical, Yan'an Energy Chemical and other equipment maintenance to reduce supply pressure, but downstream demand restrictions also suppress prices
.
PE strength is not expected to be easy
.

Upstream raw materials market: The price of naphtha in the Japanese market rebounded to $455.
13/ton, +5.
63
.
The ethylene Asian market is quoted in Northeast Asia at $890/ton, 0; in Southeast Asia, it is $830/ton, 0
.

Spot market: Domestic LLDPE spot market prices continue to rise
.
North China market rose 30-80 yuan / ton, the mainstream price was 7250 yuan / ton, +50; East China and South China market prices rose 100 yuan / ton, of which East China mainstream quotation is 7300 yuan / ton, 0; South China mainstream price is 7450 yuan / ton, 0
.

Warehouse receipt inventory: exchange warehouse receipts reported 3171 lots, intraday - 212 lots; In the historical median zone
.

Main position: The top 20 long positions in the main contract are 260584 lots, +3573 lots, short positions are 303499 lots, +6996 lots, and the net position is -42915 lots, with a net increase
in net shorting.

Summary: Supported by Russia's reduction in crude oil production, international oil prices fluctuated at a high level; Naphtha prices stopped falling and rebounded, which formed some support
for costs.
The results of petrochemical enterprises in reducing prices and destocking are gradually obvious; The speed of port destocking is acceptable, and inventory has fallen
significantly.
However, the downward communication of inventory is not smooth, demand follow-up is slow, and merchants maintain just need to purchase
.
The L2001 contract opened high and choppy and closed in a narrow range at the end of the
session.
MACD green column contraction, short-term futures prices are expected to continue the oversold rebound state, but in the case of supply and demand pressure, the long-term rebound may be limited
.
Pay attention to the pressure around 7340 above, and focus on the support around 7200 below, it is recommended to hold more orders in your hands with caution
.