Since this year, the main futures price of PVC has mostly oscillated in the range of 6300-6600 yuan/ton. At present, the multi-empty factors in the market continue to play a game, and it is expected that short-term PVC will be difficult to get out of the trend.

According to the recently released economic data, the world’s major economies are facing downward pressure. The Federal Reserve’s Brown Paper shows that the U.S. economy grew in January and February, but half of the country was affected by 35 days of partial government closures, so the economy cooled in the first two months of 2019. Employment and inflation data also performed poorly. Data from the U.S. Department of Labor show that the number of non-farm workers in the United States increased by 20,000 in February, significantly lower than expected and the previous value, hitting a 17-month low. The U.S. unemployment rate is 3.8% in February and is expected to be 3.9%. The data are still good, but there is little room for the unemployment rate to continue to decline. CPI in February increased by 1.5% year-on-year, the smallest increase in two and a half years. PPI in February rose by 1.9% year-on-year, the lowest level since June 2017. In addition, the manufacturing PMI in the euro area was 49.3 in February, a 68-month low. ECB President Draghi said the outlook for recent economic growth was weaker than expected. The domestic economy is also weak, including the official manufacturing industry PMI continued to fall below the boom and bust line in February, the import and export data declined sharply in February, the industrial added value and the total retail sales growth of social consumer goods continued to decline in January-February, and so on. The global economic downturn has depressed market confidence.

However, in the context of such economic pressures, the global monetary market has a slightly relaxed trend in recent years. The European Central Bank said it expected to keep interest rates unchanged at least until the end of 2019 and announced the launch of a third round of targeted long-term refinancing operations in September. The Federal Reserve took a biased stance in January’s interest rate meeting and signalled the end of the scale to the market. Recent weak employment and moderate inflation data may further support the Fed’s patience in raising interest rates. Because the Fed’s attitude toward monetary policy has changed, it also gives China’s money market some room for relaxation. The shift of global monetary policy from neutral tightening to marginal relaxation may have a boosting effect on commodities.

Fundamentals are mixed, and upstream cost support is enhanced. At present, OPEC continues to reduce production. Venezuela National Petroleum Corporation’s exports are interrupted due to power outages, the U.S. crude oil stocks are unexpectedly reduced, and the recent US dollar pressure has brought a positive boost to oil prices. It is expected that the short-term trend of crude oil is strong, which will form a supporting role for chemical products. Crude oil has continued to rise since its inception, and domestic calcium carbide prices have continued to rise slowly since mid-January. Wind data show that as of March 13, the mid-arrival price of calcium carbide in East China is 3350 yuan/ton, and the profit of PVC production by calcium carbide method is about 316 yuan/ton, which is about 434 yuan/ton lower than that in mid-January. Recently, due to the arrival of spring overhaul and environmental protection inspection in some areas, it is expected that the price of electrochemical industry will still rise. As costs continue to rise, profits are gradually compressed, and the production enthusiasm of PVC enterprises may be suppressed. In fact, in recent years, Tianjin Dagu, Qingdao Haijing and other devices are being overhauled. Ningxia Jinyuyuan New Factory, Taizhou Liancheng and Yibin Tianyuan plan to start the overhaul in mid or late March. Therefore, the probability of short-term PVC start-up will continue to improve is relatively small.

Cost side and supply side are favorable, and the pressure of PVC mainly comes from high inventory and weak purchasing enthusiasm downstream. According to Wind data, as of March 8, the upstream inventory of PVC was about 614,000 tons, which was significantly lower than the high level after the Spring Festival, but still in the same period of nearly three years. Warehouses, traders and downstream stocks showed no significant signs of digestion. Total social inventory has been accumulating continuously since mid-January. As of March 8, social inventory has increased by nearly 20% compared with that after the Spring Festival. Strong inventory pressure limits the upward trend of PVC futures price. On the demand side, although downstream start-up rate continues to increase, and with the coming of the peak season, downstream start-up rate still has some room to improve. However, in the face of high social inventory and uncertainty of the future market, the enthusiasm of factory procurement is still low, just need to purchase. When downstream demand fully recovers, if inventory can be quickly digested, PVC may have a wave of rising market, but at present, the digestion of inventory pressure remains to be observed.

Generally speaking, the weak operation of the global economy has depressed commodities, but in the context of economic downward pressure, the capital has relaxed, which may give a boost to commodity markets. Fundamentally, PVC is expected to be supported by rising costs and demand, and is facing high inventory pressure above. Macroscopic and basic aspects are interwoven, and short-term PVC is expected to remain in a dilemma.

On March 12, the phthalic anhydride commodity index was 66.50, down 0.33 points from yesterday, down 44.64% from the peak of 120.13 points in the cycle (2012-02-28), up 37.34% from the low of 48.42 points on January 21, 2016. (Note: Period refers to 2011-09-01 to date).

Recently, the domestic market price trend of phthalic anhydride is temporarily stable, the market of phthalic anhydride in eastern China is weak and consolidated, downstream factories are just in need of purchasing, the inventory pressure of factories is persistent, high-end transactions are blocked, the mainstream of on-site neighbouring method source negotiation is 6600-6900 yuan/ton, and the mainstream of naphthalene method source negotiation is 6500-6600 yuan/ton; the mainstream quotation of phthalic anhydride market in northern China is 6500-6800 yuan/ton, and the Main, the quotation trend of enterprises has slightly declined, downstream construction is not high, purchase on demand is the main, wait-and-see mentality is strong, domestic phthalic anhydride plant operation is stable, phthalic anhydride spot supply is normal, the market is not good, phthalic anhydride price trend remains weak.

Recently, the executive price of the upstream product of phthalic anhydride, Sinopec o-phthalic anhydride, is 6800 yuan/ton. The actual market transaction price is 7100 yuan/ton. The quotation is stable and the port is out of stock. Upstream raw materials mixed xylene price shocks maintain stability, phthalic turnover is general, port phthalic inventory is low, phthalic external quotation rises, import phthalic cost rises, the actual transaction price talks in detail, upstream price trend is stable, phthalic anhydride market prices remain volatile. DOP price downstream shocks. Recently, in Zhejiang DOP market, merchants’quotations are maintained at 8650-8700 yuan/ton, while downstream prices are at a low level. Demand for upstream phthalic anhydride is limited, and the market price of phthalic anhydride is slightly lower. It is expected that the market price of phthalic anhydride will be around 6800 yuan/ton in the later period.

On March 11, the PX Commodity Index was 72.00, unchanged from yesterday, down 29.69% from its peak of 102.40 points in the cycle (2013-02-28), and up 58.07% from its low of 45.55 points on February 15, 2016. (Note: Period refers to 2013-02-01 to date).

Recently, the domestic market price trend of p-xylene has been temporarily stable. Pengzhou Petrochemical Plant has been running steadily. Urumqi Petrochemical Plant has started 50% of its operation. Fuhaichuang Aromatic Hydrocarbon Plant has started a line. CNOOC Huizhou Refinery and Chemical Plant has been overhauled. Other units have been running steadily for the time being. The domestic market supply of p-xylene is normal. The market price trend of p-xylene is temporarily stable. The opening rate of PX plant in Asia is about 80%. On March 11, the closing price of p-xylene in Asia increased by 3 US dollars/ton. The closing price is US$109-1101/ton FOB Korea and US$118-1120/ton CFR in China. More than 50% of the domestic units need to be imported. The decline of foreign prices has a positive and negative impact on the domestic market price of p-xylene, and the price of p-xylene in the market fluctuates.

On March 11, the price of WTI crude oil in April rose to 56.79 U.S. dollars per barrel, an increase of 0.72 U.S. dollars. The price of Brent crude oil in May rose to 66.58 U.S. dollars per barrel, an increase of 0.84 U.S. dollars. Crude oil price rose slightly, which had little impact on the price of downstream petrochemical products, while the price of paraxylene market was temporarily stable. Recent textile industry volatility, PTA prices declined on the 12th, the average price of East China bid in the vicinity of 6600-6700 yuan/ton, up to 11 domestic PTA start-up rate is about 80%, polyester industry start-up rate is about 80%, downstream production and sales rate has risen, but PTA market prices are lower, it is expected that PX market prices will remain volatile in the later period.

On March 10, the ammonium nitrate commodity index was 107.02, which was the same as yesterday. It was 9.63% lower than the cyclical peak of 118.42 points (2019-01-15), and 38.32% higher than the lowest point of 77.37 on October 31, 2016. (Note: Period refers to 2013-02-01 to date)

Recently, the price trend of domestic ammonium nitrate Market has maintained a low level. Affected by environmental protection control, domestic ammonium nitrate plants shut down more, and domestic ammonium nitrate plants started less. However, with the warming of the weather recently, the influence of northern air limitation disappeared. In addition, due to the complete shutdown of domestic downstream civil explosion industry, domestic ammonium nitrate manufacturers have more stockpiles and the price trend in the field has declined. By the end of the weekend, the domestic ammonium nitrate market price negotiations in 1900-2100 yuan/ton, affected by environmental protection, so now many manufacturers in many areas are forced to limit production or stop production and maintenance to accept environmental protection inspection, the price trend of ammonium nitrate in the field is weak.

Recently, the domestic nitric acid price trend is temporarily stable, the market price is 1550 yuan/ton on the 11th day. The stable trend of nitric acid price has little effect on the ammonium nitrate market, and the price trend of ammonium nitrate has slightly declined. The price trend of upstream raw material liquid ammonia has risen slightly, and the market price of liquid ammonia on the 11th day is 3016.67 yuan/ton. The rising trend of upstream raw material price has a certain positive impact on the ammonium nitrate market. Ammonium nitrate market price trend slightly lower. At the end of the peak season of the downstream civil explosion industry recently, the demand for ammonium nitrate has weakened and the stocks of ammonium nitrate manufacturers have increased, but the liquid ammonia market is on the rise again. The ammonium nitrate Market has slightly declined due to the bad market. Ammonium nitrate analysts believe that the price of raw materials in the upstream market has risen slightly in the near future, but the demand in the downstream market is not good. They expect that the market price of ammonium nitrate in the later period will decrease slightly.

According to the preliminary statistics of the Chinese Customs, in February 2019, China exported 1.342 million tons of mineral fertilizers and chemical fertilizers (excluding ammonium chloride, potassium nitrate and organic fertilizers for animals and plants, the same below), an increase of 53.4% over the same period of last year, and an increase of 69.0% over the same period of last year, amounting to US$379 million.

From January to February, China exported 3.524 million tons of mineral fertilizers and chemical fertilizers, an increase of 59.6% over the same period last year, and the cumulative export amount was $992 million, an increase of 84.9% over the same period last year.

In terms of fertilizer imports, China imported 11.9 million tons of minerals and chemical fertilizers in February 2019, amounting to US$370 million. The main imported fertilizers in China are potassium chloride and nitrogen, phosphorus and potassium ternary compound fertilizers.

From January to February, China imported 2.471 million tons of minerals and chemical fertilizers, an increase of 6.0% over the same period last year, and the total import amount was $773 million, an increase of 26.5% over the same period last year.

According to data released by the General Administration of Customs on March 8, China exported 688,000 tons of coke in February, an increase of 41,000 tons, an increase of 6.3%, and a decrease of 28,000 tons, a decrease of 3.9%.

Coke exports in February were $225.4 million, up 14.2% year-on-year and 9.9% year-on-year. Based on this, the unit export price is estimated to be 327.6 US dollars per ton, up 41.2 US dollars per ton annually and 22.5 US dollars per ton annually.

From January to February 2019, China exported 1.44 million tons of coke, an increase of 5.3% over the same period last year; the cumulative export amount was US$430.3 million, an increase of 8.8% over the same period last year.

The Baltic Shipping Exchange’s dry bulk index fell Tuesday, offsetting strong demand for small vessels as cape-type freight hovered near a three-year low.

The overall dry bulk index fell 6 points, or 0.9%, to 663.

The Cape index fell 56 points, or 15.8%, to 299, its lowest level since the end of March 2016. Average daily profit decreased by $362 to $4,535. The normal carrying capacity of this type of ship is between 170,000 tons and 180,000 tons, carrying cargo such as iron ore and coal.

The Panamanian Ship Price Index rose 24 points, or 2.7%, to 924, the highest level in six weeks. Average daily profit climbed $187 to $7,436. The normal carrying capacity of this type of ship is between 60,000 and 70,000 tons, and the cargo is usually coal or grain.

The super-handy index rose 9 points, or 1.2%, to 776.

In March, the release of domestic agricultural demand is expected, and fertilizer manufacturers are also closely watching the slight changes in the market. So far, the “strong” rebound of nitrogen fertilizer urea market, such as Shandong, Hebei and other places, has led to a marked rise in prices, leading to the downstream measures are not as good as, but the wholesale prices of urea in Anhui, Ningxia, Yunnan and other basic layers are falling, the terminal for the next trend of urea there is greater concern. Is the desire of ammonium chloride, a small nitrogen fertilizer, to pull back the game with the momentum of urea slim? At present, the ammonium chloride market is in a dilemma of “three high and one low”: high start-up, high inventory, high terminal wait-and-see mood, low price of ammonium chloride.

At present, the domestic ammonium chloride market is weak, enterprises can generally guarantee the bottom of the pre-collection, buy-out prices are also intermittently lowered. The mainstream wet ammonium factory quotation in East China is about 500-520 yuan/ton, some 480-490 yuan/ton, and the mainstream dry ammonium factory price in Central China is about 680-710 yuan/ton, some can guarantee the bottom or single negotiation. The inventory of enterprises is increasing constantly, with a small amount of 10,000 tons and a large number of about 2.3 million tons. At present, the most difficult problem for enterprises is how to digest the inventory as soon as possible. Looking at March when the spring Market starts, whether the ammonium chloride factory can clear the inventory and whether the price can survive or not needs to consider the changes of various factors comprehensively.

Firstly, the difficulty of start-up of joint alkali enterprises has been significantly reduced. According to statistics, the overall industry start-up rate of domestic joint alkali enterprises is 77%. The ammonium chloride plant in North China is basically full-load production; in East China, except for individual plant overhaul, more than 80% of the other plants are started, but one of them has overhaul plan in March; in Central China, the ammonium chloride plant is basically full-load production; in addition, in the overhaul of a new plant, the ammonium chloride plant in Southwest China will operate normally in the later period without accident; Work normally, a gas head ammonium chloride enterprise plans to resume full load after March 15, all of which means that the start of ammonium chloride enterprises will maintain a high level and have a rebound trend. However, we need to consider whether the environmental inspection will reduce the start of ammonium chloride, and the planned maintenance of individual enterprises in some areas will temporarily ease the pressure of shipment, but the effect is very little.

Second, demand is moving slowly. First, compound fertilizer enterprises start low-level operation, even if the spring market is imminent, but the recovery progress is slow, coupled with a small number of small and medium-sized compound fertilizer enterprises or plans to resume production after March 15, the inventory pressure of large and medium-sized compound fertilizer enterprises has not decreased, downstream traders and terminal grassroots pre-reserve supply is more sufficient, the replenishment progress is slow, which directly affects the production progress of compound fertilizer enterprises, raw materials. Fertilizer procurement enthusiasm is not high, with the majority of picking. Secondly, the demand of extruded granular ammonium chloride enterprises is limited, and some extruded granular ammonium chloride enterprises in Northeast China have not resumed production. Some extruded granular ammonium chloride enterprises in Henan Province have quoted only 700-730 yuan/ton in the early period. Although there are new granular ammonium chloride plants in Ningxia, Inner Mongolia, after all, the demand for raw powder ammonium is small, and at the same time, compound fertilizer is distributed to a certain extent. Third, the low price of agricultural products at the grass-roots level, high sales pressure, farmers’enthusiasm for planting land is not good, local planting structure may face adjustment, fertilizer habits may also change, the use of raw materials or reduce risks.

Thirdly, urea market fluctuates frequently, which has a great influence on ammonium chloride. This wave of urea warming is due to the appropriate purchasing in local agricultural market and environmental inspection. Some enterprises shift their production focus to liquid ammonia or parking maintenance. The supply of urea decreases. However, with the resumption of construction, the production of a small number of gas enterprises has been completed and the market is weakening, so the support for ammonium chloride has been reduced.

Finally, in general, even if demand starts after mid-March, the stock of ammonium chloride enterprises should be digested for a period of time, while the compound fertilizer enterprises own more stocks, slow production progress, and ammonium chloride enterprises themselves to maintain a high start, then inventory emptying is difficult.

On March 4, methanol futures continued to rise 4% in the afternoon.

Superimposed production restriction for spring inspection, methanol supply or tightening

Due to the early shutdown of the Southwest Gas Head Unit, including Jiuyuan in Sichuan, Kabera in Chongqing and Lutianhua in Sichuan, which restarted in early February, the upstream start-up rate has risen to around 70%, reaching a historical high in recent years. After March, with the end of the northern heating season, some heavy-duty devices will be restarted one after another. The Datang Duolun device, which stopped in early February, is expected to restart in early March, the Boyuan device in Inner Mongolia is scheduled to restart in mid-March, and the Qinghai Guilu and Qinghai Zhonghao gas head devices are also scheduled to restart in March, and then the Southwest gas head capacity will be restarted one after another for some time in the future. Restart capacity is expected to exceed 4 million tons.

However, according to the situation over the years, after March, the spring inspection of methanol will begin soon. The peak of the inspection is from March to May. Due to the specific production arrangements, the maintenance of some enterprises will be delayed to 4-6 months. According to the current announced maintenance plan, some coal head devices in Northwest China will take the lead in overhaul, including Rongxin 900,000-ton plant in Inner Mongolia, Jiutai 1 million-ton plant and Shanxi Tongfa 600,000-ton plant. The overhaul capacity will exceed 6 million tons in March-May. In addition, due to the recent impact of Linfen in Shanxi on the production restriction of coking enterprises, including Shanxi Coking, Shanxi Hongyuan, Shanxi Guangda and Shanxi Wanxinda coke oven gas methanol plants will be shut down for about one month in the near future, with an estimated capacity of about 800,000 tons. Considering that the two sessions will be held in March, it is not excluded that the northern environmental protection and production restrictions may be increased, and the overall supply may be tightened.

Foreign Power Feb. 27, OPEC Secretary-General Balkin said Wednesday that he agreed to hold an additional meeting in April to assess market reaction.

He said April would be a good time to assess the market and OPEC would make decisions based on market conditions.

Balkin also said that the implementation of previous production cuts was impressive and believed that it would continue in 2019.

He also said he was concerned about the situation of OPEC’s two major founders and the impact of sanctions, which complicate efforts to achieve and maintain market rebalancing.