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20 November 2024 - Shenhua's coal-based PP and PE Auction ResultsWith key futures contracts on the Dalian Commodity Exchange extending their upward trajectory—most notably LLDPE contracts reaching their highest levels since July 2024—Chinese buyers displayed increased interest in securing coal-based parcels on the Shenhua Auction Platform. |
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Shenhua Baotou Coal Chemical Co has concluded the auction session for its coal-based PP and PE cargoes on 20 November 2024. The following table showed the details of the auction results for prime grade only:
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Product |
Auction Volume |
Deal Volume |
Auction Prices |
Deal Prices |
Deal % |
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CNY/ton |
USD/ton |
CNY/ton |
USD/ton |
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Combined and reported by CommoPlast |
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Homo-PP |
1380 |
1338 |
7140 |
$873 |
7210-7500 |
$881-917 |
97.0% |
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PPBC |
136.3 |
100 |
7310 |
$894 |
7570-7580 |
$925-927 |
73.4% |
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LLDPE |
350 |
330 |
8450 |
$1033 |
8510-8610 |
$1040-1052 |
94.3% |
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*Auction and Deal volumes are in tonnage *All USD equivalent prices only exclude the 13% value-added tax (VAT). They have not taken into account other costs that might incur in the selling process, i.e. import duty, customs clearances. |
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With key futures contracts on the Dalian Commodity Exchange extending their upward trajectory—most notably LLDPE contracts reaching their highest levels since July 2024—Chinese buyers displayed increased interest in securing coal-based parcels on the Shenhua Auction Platform.
Despite a CNY 100/ton hike in LLDPE auction prices, Shenhua concluded the session with robust results. However, industry speculation suggests that the producer may have intentionally reduced LLDPE auction volumes to prioritize offline sales, which reportedly yield better netbacks.
While the immediate performance appears strong, market participants remain cautious, questioning the sustainability of the current bullish trend. Growing concerns over demand fundamentals and broader macroeconomic challenges are tempering optimism in the market.
Background:
Shenhua Baotou Coal Chemical Co, the largest coal-based polyolefins producer in China, operates through four subsidiaries: Shenhua Xinjiang Coal-based New Materials Project, Shenhua Yulin Energy Co. Ltd., Shenhua Baotou Coal Chemical Co. Ltd., and Shenhua Ningxia Coal Industry Group (Ningmei).
The company boasts an annual production capacity of 2.65 million tons of PP, 750,000 tons of HDPE/LLDPE, and 570,000 tons of LDPE.
Active in spot trading, Shenhua Baotou also conducts daily auctions for its cargoes from 10 AM - 12 PM on its dedicated online platform, available at https://www.e-chnenergy.com.
Written by: Kat Yun Yun
Edited by: Muhammad Hafiz
Country
China
