14 August 2023 - Shenhua's coal-based PP and PE Auction Results
Despite prices for LLDPE being CNY20/ton lower than last Friday, deals were under the 30% mark signalling that customers are choosing to keep away from purchases and monitor the current trend to ascertain if prices may retreat further.
Shenhua Baotou Coal Chemical Co has concluded the auction session for its coal-based PP and PE cargoes on 14 August 2023. The following table showed the details of the auction results for prime grade only:
|
Product |
Auction Volume |
Deal Volume |
Auction Prices |
Deal Prices |
Deal % |
||
|
CNY/ton |
USD/ton |
CNY/ton |
USD/ton |
||||
|
Combined and reported by CommoPlast |
|||||||
|
Homo-PP |
1182 |
770 |
7150 |
$872 |
7300-7470 |
$890-911 |
65.1% |
|
PP Fiber |
- |
- |
- |
- |
- |
- |
- |
|
PPBC |
- |
- |
- |
- |
- |
- |
- |
|
LLDPE |
1000 |
280 |
7930 |
$967 |
8080-8180 |
$985-997 |
28.0% |
|
LDPE heavy duty |
- |
- |
- |
- |
- |
- |
- |
|
HDPE |
- |
- |
- |
- |
- |
- |
- |
|
*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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Trading activity on the Shenhua auction platform at the start of the week plunged significantly as deals were plagued by the retreating futures market. Despite prices for LLDPE being CNY20/ton lower than last Friday, deals were under the 30% mark signalling that customers are choosing to keep away from purchases and monitor the current trend to ascertain if prices may retreat further.
It is worth noting that if the futures contracts continue to retreat further, prices may be revised down but traders speculate the discounts may be on the softer side as local producers are still free from inventory pressure. However, it is possible that with the added factor of the diminished end-product market, producers may be inclined to entertain larger discounts.
Background:
Shenhua Baotou Coal Chemical Co is currently the largest coal-based polyolefins producer in China, operates under four subsidiaries, namely: 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 has an annual capacity of 2.65 million tons/year of PP, 750,000 tons/year of HDPE/LLDPE and 570,000 tons/year of LDPE.
Shenhua Baotou Coal Chemical Co is active in spot trading, while also conducting the daily auction for its cargoes daily between 10AM to 12PM on the official online platform that specifically designed for this purpose: https://www.e-chnenergy.com