11 October 2024 - Shenhua's coal-based PP and PE Auction Results
The modest discount of CNY 30/ton on homo-PP has incentivized market participants to increase their purchasing activity. In contrast, LLDPE has shown stronger transactions than homo-PP, driven by expectations of reduced import arrivals, which are expected to tighten domestic supply.
Shenhua Baotou Coal Chemical Co has concluded the auction session for its coal-based PP and PE cargoes on 11 October 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 |
2460 |
1877 |
7300 |
$914 |
7320-7700 |
$916-964 |
76.3% |
|
PPBC |
170 |
85 |
7750 |
$970 |
7900-8170 |
$989-1023 |
50.0% |
|
LLDPE |
950 |
900 |
8200 |
$1026 |
8200-8480 |
$1026-1061 |
94.7% |
|
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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A consistent rebound has been observed on the Shenhua auction platform, particularly in the trading of homo-PP leading to a higher volume of successful transactions compared to the previous auction. The modest discount of CNY 30/ton on homo-PP has incentivized market participants to increase their purchasing activity. In contrast, LLDPE has shown stronger transactions than homo-PP, driven by expectations of reduced import arrivals, which are expected to tighten domestic supply.
At the same time, market sentiment remains cautious as participants await the outcome of a crucial meeting between the People's Bank of China and the Ministry of Finance, scheduled for tomorrow. The results of this meeting are expected to significantly influence market conditions in the coming week.
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