Price trend

In early August, the domestic ABS market was positive, with spot prices rising. According to the Commodity Market Analysis System of the Business Society, as of August 7th, the average price of ABS sample products was 10575 yuan/ton, an increase or decrease of+0.71% compared to 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 around 88%, which is basically flat compared to the end of last month. The on-site supply of goods is relatively abundant. At the beginning of the month, there was a slight decrease in inventory, with an overall inventory of around 145000 tons. The supply side has strong support for the spot market.

In terms of raw materials: At the beginning of this month, the overall performance of ABS upstream three materials was relatively strong. The market for raw material acrylonitrile continues to rise. The strengthening of raw material prices has provided good support for acrylonitrile; Downstream operating positions fluctuate, resulting in average demand for acrylonitrile; Although the industry has seen some improvement in recent construction, there is also a trend of stronger demand. It is expected that the price of acrylonitrile may continue to be biased towards consolidation.

At the beginning of this month, domestic butadiene prices were at a high level. The rising prices of crude oil and naphtha have brought a certain boost to the cost side, while some downstream product prices have risen, providing some support to the market demand side. Merchants’ expectations for demand have strengthened, coupled with the strong offer for distant cargo in the outer market, and the market atmosphere has risen.

From the figure below, it can be seen that the recent high price consolidation in the styrene market has occurred. In the early stage, styrene rose due to fluctuations in crude oil prices, leading to an increase in the pure benzene market and following the trend upstream. Another enterprise has delayed resumption of work, and there has been a slight increase in downstream construction in the early stage. There are many supporting factors for styrene, resulting in a high consolidation of the market.

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 acceptance level of manufacturers decreased, and the procurement operation was cautious, resulting in poor overall demand.

Future Market Forecast

At the beginning of this month, the overall high level consolidation of ABS upstream three materials provided reasonable support for the cost side of ABS. The petrochemical plant started relatively horizontally in the early stage, and market inventory has been partially digested. 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 narrow consolidation market.