The domestic ABS market rose in early December, with spot prices of various grades increasing. According to the Commodity Market Analysis System of Shengyi Society, as of December 11th, the average price of ABS sample products was 11750 yuan/ton, with a price level increase or decrease of+2.29 compared to the beginning of the month.

Fundamental analysis

Supply level: In early December, the operating rate of the domestic ABS industry remained stable with small fluctuations, and the industry load level had limited changes compared to the end of November. The resumption of maintenance and work within ten days has been mutually observed, with the overall industry operating rate decreasing by 2% to around 69%, and the weekly average production of 117000 tons slightly declining. Inventory has also been digested, with a decrease of nearly 20000 tons to around 160000 tons, but the overall pattern of abundant supply remains unchanged. Overall, the supply side provided average support for ABS spot prices in early December.

Cost factor: Since December, the trend of ABS upstream three materials has either consolidated or increased, and overall support for ABS cost side performance is still acceptable. The domestic acrylonitrile market remains at a high level with an upward trend, while the supply in the East and South China regions remains tight and unchanged, making it difficult to achieve significant growth in the short term. With low inventory support, suppliers continue to raise prices, and the market continues to rise, with prices remaining firm and upward.

The domestic butadiene market has steadily rebounded slightly within the range. In the early stage, the arrival of cargo in the East China region was poor, and the supply expectation in the spot market was tight. In addition, the ex factory prices of suppliers have risen recently, and spot market offers have generally increased. Downstream demand remains weak, procurement intentions are poor, and insufficient demand support may make it difficult to maintain upward momentum in the future market. Overall, the price increase of butadiene may be limited.

In early December, the styrene market fluctuated and consolidated. The upstream crude oil in the far end has slightly loosened, and the price of pure benzene, the direct raw material, has fallen after rising. The cost support of styrene is struggling. The operating rate of domestic industries has limited changes, and the tight supply situation continues. Combined with the decline in imports expected at the end of the previous month, the current bullish trend dominates the market, but the expectation of weakened supply and demand in the future has led to cautious operations by businesses.

On the demand side: Although the downstream wait-and-see sentiment remained strong in December, the terminal side of home appliances products made efforts. Due to the continuous stimulus of the national subsidy policy for household appliances, sales of some end products have increased, and demand has slightly risen. Due to the concerns of home appliance exporters about the remote market, some export demand has been pushed forward, the overall load position of factories has rebounded, terminal stocking willingness has strengthened, and procurement operations have increased synchronously. Merchants continue to digest inventory, try to increase their offers, and increase the activity of source circulation. Overall, the demand side is helping to heat up the market.

Future forecast

The domestic ABS market strengthened in early December. The performance of the upstream three materials is still acceptable, providing strong comprehensive support for the cost side of ABS. The load of ABS polymerization plant has slightly decreased, and finished product inventory continues to be digested. The demand side is becoming stronger, and the market is stable and strong under the guidance of consumption. However, the supply contraction within the venue is limited, and coupled with the fear of overdrawn demand for household appliances, future consumption may be affected. Industry players are concerned about the future market, and analysts from Business Society believe that the uncertainty of ABS’s forward trend may constrain short-term gains. In the near future, the ABS market may return to a narrow range consolidation trend.

1、 Price trend

According to data monitored by Shengyi Society, as of December 10th, the average price of industrial grade high-quality cyclohexane in China was 7700 yuan/ton. Currently, the domestic cyclohexane market is operating steadily, with transaction prices remaining at around 7700 yuan/ton. The cyclohexane market supply is sufficient, and follow-up is cautious, with a strong atmosphere of cautious observation downstream.

2、 Market analysis

In terms of cost: Currently, the upstream pure benzene has rebounded after a decline, while the downstream rigid demand procurement is active, with contracts for procurement within the month supported by favorable macro policies. The downstream buying potential is still acceptable, and it is expected that prices will be strong in the short term.

Downstream: Currently, the low prices of cyclohexanone in the South China market have decreased, and downstream purchases are being made on demand. The supply of spot goods in the market has also decreased, resulting in frequent high prices. In the short term, prices are expected to remain strong.

3、 Future forecast

The cyclohexane analyst from Shengyi Society believes that there is currently price support in the upstream and a positive purchasing atmosphere in the downstream. It is expected that the cyclohexane market will maintain its current trend in the short term.

Market Overview: The domestic acrylonitrile market continues to operate at a high level, with tight supply in the East and South China regions, and it is difficult to see significant growth in the short term. Under the support of low inventory, suppliers continue to raise prices, and the market continues to rise, with prices remaining firm and exploring upward.

On the supply side: During the week, major factories in East China were operating at low loads, and there was no significant increase in supply in the short term. Anqing Petrochemical resumed operation of two lines, but the 130000 ton acrylonitrile plant in Jihua (Jieyang) will be shut down for maintenance starting from December 3, and is expected to last for about 10 days. Therefore, the overall supply is still limited; Zhejiang Petrochemical will continue to operate a 260000 ton acrylonitrile plant this month, with a capacity utilization rate of 50%; The 200000 ton acrylonitrile plant of CNOOC Fudao Chemical will undergo maintenance on a production line starting from November 20th, and the start of work is also around 50%. The supply in the East China region continues to be tight, while the northern market is operating at full capacity. As of December 5th, the domestic acrylonitrile industry’s capacity utilization rate reached 71.14%, an increase of 1.36% compared to the same period last week. The inventory of acrylonitrile enterprises was 28300 tons, a decrease of 2400 tons from last week.

In terms of cost, domestic propylene prices have risen narrowly this week, with mainstream transactions in the Shandong propylene market referring to 6950-7050 yuan/ton. Although the Weiyuan PDH plant restarted this week, there is a shortage of propylene resources from North China and the west coast of the Yellow Sea in the Shandong region, which supports the price trend. However, the downstream profit space is narrow, coupled with an increase in plant load reduction and weak demand side follow-up, which still suppresses the price trend. It is expected that propylene may remain weak in the short term.

In terms of demand, downstream demand is basically stable. In mid to late November, the main downstream industry ABS stopped for maintenance at the first line of Zhejiang Petrochemical Phase II. In addition, Jilin Petrochemical’s operating load has further decreased, and the capacity utilization rate has not changed much this week. As of December 6th, it was 68.90%, an increase of 0.08% compared to last week.

Market expectation: Currently, the supply in East China is still limited in the short term, with major factories operating at low loads, and there is a possibility of further decline in the operating load of the Sirbond plant. Although the resources in the north are relatively abundant, factory inventory is not high, and spot prices are also firm and high. It is expected that the domestic acrylonitrile market will remain strong in the short term.

This week (12.1-12.6), the nickel price market is running weakly. According to the monitoring of nickel prices by Shengyi Society, as of December 6th, spot nickel was reported at 12730 yuan/ton, with a weekly decline of 0.78% and a year-on-year decline of 1.59%.

Macroscopically, although there are signs of recovery in China’s manufacturing activities, the selling pressure caused by the strengthening of the US dollar has dragged down nickel prices. Additionally, concerns about China’s economic growth and the prospect of US tariffs have been offset by the weakness of the US dollar, resulting in a rise in nickel prices. Affects price range fluctuations in the domestic market.

On the supply side, Shanghai nickel has strong destocking and more inventory has been stored, while London nickel has weak destocking and overall inventory is under pressure. As of December 6th, the inventory of Shanghai nickel warehouse receipts was 29579 tons, an increase of 2406 tons during the week; On December 6th, LME nickel inventory was 165264 tons, an increase of 5298 tons for the week.

On the demand side, the reduction in stainless steel production did not meet expectations or continued to operate weakly. As of December 6th, the reference price for stainless steel in Shengyi Society was 13267.50 yuan/ton, a decrease of 0.66% from the beginning of the week. Steel mills still maintain high production capacity, social inventory remains relatively high, and there is no significant improvement on the demand side.

Market forecast: Demand for essential goods is expected to be replenished at low prices, inventory is under pressure, and price increases are hindered. Attention should be paid to macroeconomic fluctuations, and it is expected that nickel prices will fluctuate in the short term.

According to the Commodity Market Analysis System of Shengyi Society, from November 28th to December 5th, MTBE prices rose from 5425 yuan/ton to 5475 yuan/ton, with a price increase of 0.92% during the period, a month on month increase of 3.79%, and a year-on-year decrease of 16.09%. The domestic MTBE market is stable and consolidating. After entering December, there are some pending delivery orders for gasoline, and there is a high enthusiasm for purchasing gasoline raw materials. At the same time, there are also many new gasoline vehicle and ship orders, which provide positive support for the relevant gasoline raw material market, and the market remains firmly consolidated.

On the cost side, in terms of crude oil: International oil prices have fallen, and the main negative factors are: the tense atmosphere in the Middle East has eased again, the increase in US refined oil inventories has exceeded expectations, and the market is still concerned about weak demand prospects. As of December 4th, the Brent price was $72.31 per barrel.

From the perspective of demand and downstream gasoline terminal demand, gasoline transactions are still relatively active, and there are some orders waiting to be delivered, which provides some support. Short term MTBE demand is influenced by favorable factors.

Supply side: Narrow fluctuations and consolidation of resource supply side. Short term domestic MTBE supply is affected by bearish factors.

As of December 4th, the closing price of the Asian MTBE market has increased by $20.4/ton compared to the previous trading day, and FOB Singapore closed at $723.69-725.69/ton. The closing price of the European MTBE market increased by 0.25 US dollars/ton compared to the previous trading day, and FOB ARA closed at 825.99-826.49 US dollars/ton. The closing price of the MTBE market in the United States increased by $47.35/ton compared to the previous trading day, and the FOB Gulf offshore price closed at $807.88-808.23/ton (228.11-228.21 cents/gallon).

According to the forecast of supply and demand game in the future, MTBE analysts from Shengyi Society believe that the domestic MTBE market will experience a narrow consolidation in the short term.