Zinc prices fluctuate and consolidate this week

According to the Commodity Market Analysis System of the Business Society, as of September 22, the zinc price was 22174 yuan/ton, a slight increase of 0.01% compared to the fluctuating zinc price of 22172 yuan/ton on September 15. The fundamentals are mixed, with limited fluctuations in zinc prices. The daily fluctuations in zinc prices have not exceeded 1%, and zinc prices have fluctuated and consolidated in a narrow range this week.

Zinc market fundamentals

The hawkish statement from the Federal Reserve boosted the US dollar index, with 10-year US Treasury yields hitting new highs. According to data from the US Department of Labor, the number of initial jobless claims in the week of September 16th decreased by 20000 after seasonal adjustments. The US labor market remains resilient, and the Federal Reserve has significantly raised its GDP growth forecast for 2023 and its GDP forecast for 2024. Macro positive, zinc market macro positive.

In terms of supply, the supply of zinc concentrate is relatively loose, and with high profits from smelters, the supply of zinc ingots increases. Coupled with the opening of the zinc ingot import window, the supply of zinc in the market increases; In terms of demand, the renovation of urban villages and the preparation of goods before the Double Festival have stimulated demand in the zinc market, and the consumption of infrastructure and home appliances has strengthened. However, real estate has dragged down consumption in the zinc market, and the actual effect of policy incentives has not been obvious. The accumulation of finished product warehouses has forced the operating rate of galvanized pipe enterprises to decline, and the growth rate of demand in the zinc market lags behind supply, making it difficult to reverse the trend of overcapacity. The overall zinc market is oversupplied, and there are still bearish prospects in the zinc market.

Future Market Forecast

According to data analysts from Business Society, the macroeconomic expectations of the international market have rebounded, and the positive support for the zinc market has increased. The domestic supply and demand expectations have both increased, but the supply growth rate is expected to be faster than the demand growth rate, resulting in an oversupply of zinc in the domestic market. Overall, the macro outlook is positive for both supply and demand, but the zinc market is oversupplied, making it difficult to determine the rise or fall of zinc prices. It is expected that zinc prices will consolidate in a narrow range in the future.

1、 Price trend

According to the monitoring of the Commodity Market Analysis System of the Business Society, the spot price of PVC carbide SG5 has decreased this week. On Thursday, September 14th, the average domestic PVC price was 6310 yuan/ton, and on Thursday, September 14th, the average price was 6214 yuan/ton, with a price drop of 1.52% during the week.

2、 Market analysis

This week, the domestic spot market price of PVC fell. The upstream calcium carbide market prices have significantly declined, and the futures market has weakened slightly, leading to a lack of confidence in the PVC spot market and a decrease in prices. The demand in the downstream market is poor, and the trading atmosphere on the market is weak. Many people are cautious and wait, and the overall transaction situation is weak, with pre holiday restocking being the main focus. As of now, the quotation range for PVC5 carbide materials in China is mostly around 6050-6450 yuan/ton.

In terms of crude oil, international crude oil futures closed lower on September 20th. The settlement price of the main contract for WTI crude oil futures in the United States was $89.66 per barrel, a decrease of $0.82 or 1.0%. The settlement price of the main contract for Brent crude oil futures was $93.53 per barrel, a decrease of $0.81 or 0.9. The Federal Reserve has decided to maintain interest rates unchanged as expected by the market, but its attitude is hawkish. It is expected that there will still be a possibility of interest rate hikes within the year, and energy demand expectations will be suppressed, leading to a downward pressure on oil prices.

In terms of calcium carbide, according to data monitored by Business Society, the prices of calcium carbide manufacturers have significantly decreased this week. Last Thursday, September 14th, the average price of domestic calcium carbide was 3350 yuan/ton. This Thursday, September 14th, the average price was 2950 yuan/ton, and the price fell by 11.94% during the week. Upstream orchid charcoal prices are stable and relatively strong, with acceptable cost support. The downstream PVC market has recently slightly declined, and downstream customers’ enthusiasm for calcium carbide procurement has weakened. As the National Day approaches, manufacturers are lowering prices to attract orders. In the future, it is expected that the factory price of calcium carbide in the northwest region may slightly decrease as a supplement, with consolidation being the main focus.

3、 Future Market Forecast

PVC analysts from Business Society believe that the trading atmosphere in the PVC spot market this week is not good. Upstream calcium carbide prices have significantly declined, with weak support. In addition, futures prices have been declining this week, which has dampened confidence in the spot market and shifted the focus of the PVC spot market downward. It is expected that the PVC market will continue to fluctuate within the range in the short term, and we will closely monitor changes in the news.

Product name: Titanium dioxide powder

Latest price on September 20th: 17100 yuan/ton

Key analysis points: On September 20th, the domestic titanium dioxide market price rose. On the 18th, Longqi took the lead in promoting price increases, and other manufacturers followed suit one after another. Overall, the price of domestic titanium dioxide has increased by around 700 to 1000 yuan/ton, while the sales price for foreign trade has increased by around 100 to 150 dollars/ton. At present, some domestic manufacturers are waiting and sealing orders, and some manufacturers are implementing new order quotations. The focus of the new order transaction price has shifted upwards.

Prediction: It is expected that the trend of titanium dioxide powder will be strong in the short term, and the actual transaction price will be negotiated separately.

Commodity Market: According to the Commodity Market Analysis System of Business Society, in mid September, the mainstream market of polyacrylamide (CPAM, cationic, molecular weight 12 million, 10-30 ionic degree) in China’s domestic market slightly declined. On the 10th, the market reported around 13971 yuan/ton, and on the 19th, it reported around 13860 yuan/ton, with a decline of only 0.8%. The recent rise in crude oil has had an impact, leading to an increase in the prices of various raw materials. The market for raw materials acrylonitrile and acrylic acid has risen, the cost of polyacrylamide has increased, and enterprises in the main production areas are operating normally. The market supply is abundant, downstream demand is weak, and commodity circulation is slow. The mainstream market for polyacrylamide is slightly weak.

Raw material acrylonitrile: According to the commodity market analysis system of the Business Society, the acrylonitrile market was on the rise in mid September. On the 10th, the mainstream market quotation was 9238 yuan/ton, and on the 19th, the main market quotation was 9413 yuan/ton, an increase of 1.89%. At present, the self pickup price of acrylonitrile in the market is between 9300 to 9500 yuan/ton. The slight increase in raw material prices has supported the cost of acrylonitrile; Downstream construction slightly rebounded; The operation of the acrylonitrile unit has been basically stable, and the price of acrylonitrile has slightly increased.

Raw Material Acrylic Acid: According to the Commodity Market Analysis System of Business Society, the acrylic acid market rose in mid September. As of the 19th of this month, the average price of acrylic acid in East China was 7075 yuan/ton, a slight increase of 0.71% compared to the price of 7025 yuan/ton on the 10th. Recently, the raw material propylene market has seen an increase, with increased cost support and fluctuations in some enterprise installations. The capacity utilization rate of the acrylic acid industry has decreased, and spot supply has shrunk. Downstream inquiries and purchases continue to be in demand, and the market trading atmosphere is still good. The focus of negotiations in the acrylic acid market is mainly on stability, with some enterprise prices slightly increasing.

Liquefied natural gas for production. According to the Commodity Market Analysis System of Business Society, the price of liquefied natural gas in China decreased in mid September: on September 10th, the average price of liquefied natural gas in China was 4412 yuan/ton, while on September 19th, the price was 4274 yuan/ton, a decrease of 3.14%. Recently, the price of liquefied natural gas in China has first decreased and then increased. On the 11th, domestic liquefied natural gas prices began to decrease. The market is dominated by oversupply, with a large number of heavy vehicles and limited downstream delivery capacity, resulting in a continuous decline in liquid prices. On the 14th, liquefied natural gas prices began to rebound and rise. After continuous price reductions, inventory has been alleviated, and liquid prices have increased in most regions of China, resulting in a strong market trend.

Future forecast: In mid September, the focus of raw material prices will shift upwards, the overall fuel market will decline, and the cost of polyacrylamide will slightly increase. On the supply side, enterprises in the main production area have normal production and sufficient market supply; On the demand side, downstream procurement and supply remain flat, with little change in market transactions. The polyacrylamide market remained stable and slightly weakened. It is expected that the demand side situation will continue to determine the market trend, and the probability will remain stable.

1、 Price trend

According to the Commodity Market Analysis System of Business Society, the average market price of liquid caprolactam in China was 13375 yuan/ton on September 11, and 14066 yuan/ton on September 18. The price of caprolactam increased by 5.17% this week.

2、 Market analysis

The market price of caprolactam has risen this week. The price of raw material pure benzene has significantly increased, providing positive cost support. Follow up on downstream demand with caution and prioritize on-demand procurement. The local supply of caprolactam in the market has decreased, and the supply side has performed well.

The price of raw material pure benzene has significantly increased this week. On September 11th, the price of pure benzene was 8045 yuan/ton, and on September 18th, the price of pure benzene was 8717 yuan/ton, an increase of 8.35%. This week, the price of Sinopec pure benzene was 8800 yuan/ton.

The downstream PA6 market saw a significant increase this week. The cost side support of PA6 is strengthening. The domestic polymerization plant has stable load, abundant supply, and inventory has been digested. In terms of demand, it is average, but downstream stocking enthusiasm is constrained by high prices. As of September 18th, the domestic PA6 mixed benchmark price is 14900 yuan/ton.

3、 Future Market Forecast

Business Society Caprolactam analysts believe that the caprolactam market has been relatively strong recently. Although the raw material pure benzene has slightly declined after the rise, there is still support on the supply side. It is expected that the price of caprolactam will continue to remain high and firm in the short term.