China Morning Snapshot – 10 July 2020

Dalian Commodity Exchange continues to pare earlier gains on the final trading day of the week as investor asses the new COVID-19 related lockdown.  

Details on the spot and futures prices are shown in the following table:

Compared to the previous trading day, total inventories at Sinopec and CNPC’s warehouses digested only 5,000 tons to approximately 655,000 tons as of 10 July 2020.

Purchasing activities drop significantly on the final trading day of the week, from which traders are complaining about disappointing sales result even after the price reduction. Manufacturers prefer to wait on the sideline with the expectation that spot offers for both PP and PE could soften further in the coming week would COVID-19 cases outside of China continue to increase. 

“However, any potential price reduction would only be in a small range, regardless of the falling upstream costs, because actual supply is still limited,” a trader concurred.