Price trend

Recently, the domestic ABS market has been relatively strong, with spot prices rising. According to the Commodity Market Analysis System of Business Society, as of August 25th, the average price of ABS sample products was 10725 yuan/ton, a+1.66% increase or decrease from the average price level at the beginning of the month.

Cause analysis

In terms of supply: The ABS industry has recently experienced a high load, with a total operating rate of over 94%, which has increased compared to the previous period. The on-site supply of goods is abundant. Inventory continues to rise, overall at over 170000 tons. The supply side has weak support for the spot market.

In terms of raw materials, the overall performance of the upstream three materials of ABS has been relatively good recently. The market situation of raw material acrylonitrile has remained stable with little movement. Although there has been a pressure on the market due to the increase in initial equipment starts, the price of propylene has been strong this week. In addition, the willingness of enterprises to rise after the price drop has increased, and the price of acrylonitrile may have a narrow upward trend.

This week, butadiene prices were at a high level. Driven by the rise in external market prices and the trend of downstream synthetic rubber futures, and supported by high quotations from production enterprises, it is difficult to find low-cost sources of goods in the market. However, the market has abundant spot resources, and short-term trading follow-up is relatively cautious.

From the figure below, it can be seen that the market price of styrene has continued to rise recently. Although downstream demand continued to be weak in the early stage this week, pure benzene remained strong in terms of cost. At the same time, the industry load has decreased, and the shutdown and maintenance devices have diverted some pressure from the supply side. Confidence in the market has increased, and it is expected that the short-term styrene spot market may maintain a strong consolidation operation.

In terms of demand: Currently, downstream factories, including the main terminal home appliance industry, have average enthusiasm for stocking. In addition, the downstream operating rate is still at a low level due to factors such as season and power restrictions. After the price increase of ABS, the manufacturer’s acceptance declined, and the procurement operation was cautious, resulting in overall poor trading performance.

Future Market Forecast

Recently, the upstream three materials of ABS have been steadily consolidated and have shown strong support for the cost side of ABS. The start of petrochemical plants saw a narrow increase compared to the previous period, and market inventory continued to accumulate. On the demand side, support is weak, and the overall pattern of weak and rigid demand is maintained. It is expected that the ABS market may enter a stalemate.