Review and Forecast of Polyethylene Market in the First Half of 2017

Since the first half of 2017, the international crude oil 45-55 US dollars / barrel range of shocks, the downstream unit unit down, the market to inventory more obvious, the polyethylene market in the low demand for high supply under pressure, showing the trend of shock down, the current demand Did not give the market a strong support, the second half of the polyethylene market may have to look forward to?

2017 has been half past, look back on the performance of the crude oil market: desolate tragic. International oil prices overall range of shocks to run, OPEC cut and the US shale oil production is the dominant factor in the market and oil prices. In the first quarter, OPEC cut production rate far more than expected, to provide strong support for oil prices, the international oil prices in a relatively high level of smooth operation. However, the second quarter, the US crude oil production continues to grow, the global oil inventories remain high, Libya and Nigeria, a substantial recovery in production and other factors intensified the market for oil-producing countries to cut production doubts, the international oil price shocks down.

On the trend of ethylene monomer point of view, January-February by the strong regional demand, part of the equipment overhaul, tight supply boost, ethylene prices soared, then into the March, ethylene market demand is slow, especially in Northeast Asia market pressure , The supply pressure is obvious, leading to ethylene prices into the downstream channel.

As can be seen from the figure, the US dollar market turmoil down, in the second half of 2016, especially in the fourth quarter, low inventory, brokers, sets of insurance to take the initiative to make up inventory, resulting in inventory hidden, the pressure behind rather than the real elimination The Obviously after the Spring Festival, the high growth of raw material supply, mainly from the fourth quarter of strong reinforcement, and the actual demand is weak, with the price decline, the market opened a long way to inventory. From the product point of view, the largest decline in its LDPE, from the market point of view, the Southeast Asian market is better than the Northeast Asian market.

2016 domestic prices rose significantly, especially in the second half, futures continue to pull up the spot, both inside and outside the spread after a large number of traders linked to imports of ocean cargo, this part of the incremental impact in the 2017 January to April has been revealed; 2017 domestic prices Fell more than foreign, inside and outside the spread again to upside down, and even produce re-export, export demand, but the actual operation is limited.

Review of foreign equipment maintenance point of view, the first half of 2017, foreign equipment maintenance mainly concentrated in March to May, mostly concentrated in Taiwan, Thailand, South Korea and other near foreign sources, the relative capacity is not, the market influence is small, into the third quarter , Part of the device to resume production, supply pressure increased.

In summary: Looking back at the first half of the market, look forward to the second half of the opportunity, we obviously found that long and short game, comparable, coupled with the external market, the external fund participation is not strong, the market is in shock, then the current support is: , The upstream petrochemical stocks without pressure, brokers and downstream inventory is low, followed by the back of the demand gradually to the good, bad factors suppress is: the supply is about to return, environmental policy + cash flow effects, downstream demand to follow up, the import volume is not To determine, so the second half of the year, polyethylene in the supply of no growth rate, some tight supply situation, the “gold nine silver ten” is expected to continue to increase, the overall probability of polyethylene market, the greater the probability of shock, the market price change ultimately depends on Market inventory accumulation and capital participation.