30 July 2024 - Shenhua's coal-based PP and PE Auction Results
While the number of transactions for LLDPE on the Shenhua Auction Platform showed a slight improvement compared to the previous day, the overall deals for all grades have deteriorated significantly. This decline is a direct consequence of the continued fall in futures contracts on the Dalian Commodity Exchange.
Shenhua Baotou Coal Chemical Co has concluded the auction session for its coal-based PP and PE cargoes on 30 July 2024. 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 |
1357 |
385 |
7570 |
$923 |
7570-7640 |
$923-931 |
28.4% |
|
PP Thinwall |
- |
- |
- |
- |
- |
- |
- |
|
PPBC |
478 |
77 |
7450 |
$908 |
7850 |
$957 |
16.1% |
|
LLDPE |
1050 |
620 |
8050 |
$981 |
8150-8230 |
$993-1003 |
59.0% |
|
LDPE heavy duty |
- |
- |
- |
- |
- |
- |
- |
|
HDPE |
100 |
0 |
8050 |
$981 |
- |
- |
0.0% |
|
*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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While the number of transactions for LLDPE on the Shenhua Auction Platform showed a slight improvement compared to the previous day, the overall deals for all grades have deteriorated significantly. This decline is a direct consequence of the continued fall in futures contracts on the Dalian Commodity Exchange.
Shenhua's attempt to entice demand by lowering the auction price for LLDPE by CNY 30/ton appears to have been largely ineffective. The broader market sentiment remains bearish, underscored by the nosedive in transaction results for homo-PP. This sharp decline highlights the increasing buyer resistance to current price levels, despite the limited supply conditions.
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: Rochelle Nguyen