31 July 2024 - Shenhua's coal-based PP and PE Auction Results
Shenhua successfully concluded its final auction session of July, buoyed by the rebound in futures contracts on the Dalian Commodity Exchange. The coal-based producer strategically offered discounts of CNY 30-50/ton on homo-PP and CNY 50/ton on LLDPE to entice customers, resulting in 100% of the auction volume being sold.
Shenhua Baotou Coal Chemical Co has concluded the auction session for its coal-based PP and PE cargoes on 31 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 |
1292 |
1292 |
7540 |
$923 |
7560-7660 |
$924-936 |
100.0% |
|
PP Thinwall |
- |
- |
- |
- |
- |
- |
- |
|
PPBC |
250 |
250 |
7400 |
$905 |
7430-7800 |
$908-953 |
100.0% |
|
LLDPE |
750 |
750 |
8000 |
$978 |
8000-8220 |
$978-1005 |
100.0% |
|
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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Shenhua successfully concluded its final auction session of July, buoyed by the rebound in futures contracts on the Dalian Commodity Exchange. The coal-based producer strategically offered discounts of CNY 30-50/ton on homo-PP and CNY 50/ton on LLDPE to entice customers, resulting in 100% of the auction volume being sold.
A trader commented, "Although the sustainability of this rebound is uncertain, we are seizing the opportunity to replenish some cargoes to average down the costs of the inventory on hand." This approach highlights the cautious optimism within the market, as participants take advantage of current favorable conditions to mitigate potential price risks.
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