Polyolefins generally out of V market in 2017, the first half of the expected demand bubble burst, the price pressure drops, prices bottomed out in the second half rebound, but the off-season is not short, the peak season. In 2018, the apparent growth of demand for polyolefin in the polyolefin market declined slightly from the same period of last year as compared with the same period of last year, and remained relatively high as a whole. However, the ban on import of materials and the normalization of domestic environmental inspectors can not be neglected. With the demand of downstream suppliers, The growth rate is broadly stable. We expect the price center of 2018 to move slightly up from 2017. In the meantime, the change in the ratio of PE and PP production is expected to result in the prices of both of them returning to the same level in 2013.
On the supply side, the apparent consumption of PE is expected to reach 29.27 million tons in 2018, a year-on-year growth rate of 9.50%, a slight decrease from the growth rate of last year but still exceeding the CAGR of 8.02% for 4 years and PP apparent consumption Volume is expected to reach 29.44 million tons, an increase of 7.92% over the previous year, down from last year and lower than the compound growth rate of 8.41% for the last 4 years. Although the growth rate of new material supply in 2018 has declined from 2017, it is still relatively abundant, However, the proportion of PE and PP production changes greatly, compared to PP, PE supply more abundant. Back to the material, the impact of the 2018 ban after the entry into force of the current assessment is more difficult, mainly the source of industrial and household sources of waste plastic imports accounted for the situation is unknown, the other ban the real implementation of the force remains to be seen. It is conservatively estimated that the rate of decline in the volume of imported materials in 2018 is likely to slow down in the second half of 2017. The annual import of PE materials will be reduced by about 750,000 tons and the import of PP materials will be reduced by about 580,000 tons. At the same time the domestic environmental remediation will be normalized, the operating rate of domestically produced feed back will continue to hover at a low level, and the continuous shrinkage of the entire feed back market is beyond doubt. This part of the feed back will inevitably be replaced by new feed materials and will have a greater impact on the overall supply side. The focus of the late market game lies in the end is to reduce the return of more material or more new material increases.
Demand side, downstream polyolefin to fast consumer goods, consumer goods, the product involves a wide area, the use of short cycle, non-durable goods accounted for the main proportion of these characteristics make polyolefin downstream from other industrial products, the demand is relatively rigid, by Macroeconomic impact is small. The macroeconomy only affects the changes in the inventory of the industrial chain, thereby affecting the apparent demand and has little effect on the actual demand. According to PetroChina’s statistics, after the polyolefin downstream ends its rapid growth in 2012, the average growth rate of domestic polyolefin demand in 2016-2021 will still be around 6%, maintaining a relatively stable condition. In 2018, the lower reaches of polyolefins will lead to the consolidation and upgrading of industries in environmental remediation, doubling the minimum nominal thickness of the national standard membrane and rapid growth of the express delivery industry. Conservatively estimated demand growth will be at least unchanged from 2017 and remain stable as a whole .
Unilateral strategy, a large number of domestic and foreign production capacity expected to put into operation in the first quarter, the supply pressure is large, and warehouse receipts in March are facing cancellation, the market has some selling pressure, with the Spring Festival holiday factors, downstream demand in the off-season, the price is low May appear in the first quarter of the Spring Festival eve. In the second and third quarters, the overhaul was relatively well-managed, the downstream season of plastic mulch started to start, and the over-pessimistic repair of the first quarter will bring the price to a bottom. In the fourth quarter, the supply base of new foreign countries will be basically stable supply of domestic, with the pre-repair equipment to resume operation, the supply once again abundant, but the downstream is still in the demand season, the price may be high turmoil, a slight fall.
Arbitrage strategy, short-term recommendation PP15 anti-sleeve and L-PP anti-sleeve, PP15 anti-sleeve logic: MTO unit profits have dropped to historic lows, this loss can not be long-term continuation of the market will gradually MTO device parking or down , Far PP is expected to be harder to further worsen, PP will generally appear in recent months, the pattern of monthly premium; L-PP anti-set logic: market speculation in 2018 a large number of new PE equipment expected to put into operation, and PP imports less dependent on foreign The change in output has not much impact on the production, and PP also has the marginal cost support function of MTO and MTP devices. Mid-term recommendation PP-3MA positive and L-PP is a set of, PP-3MA is a set of logic: the current PP and MA spread has shrunk to a historically low level, MTP, MTO plant a serious loss, this loss can not long-term continuation of the part of The device has been parking or down load, such as Xingxing Energy, Ningbo Fude and so on. With 2018 methanol production capacity is put on the market generally agreed that in the first half of 2018 Iran will also put into operation two sets of equipment, imports will rise significantly, while there is no big incentive to PP supply; L-PP is a set of logic: in 2018 February will be the new capacity of foreign PE started to re-evaluate the situation, if not started than expected, it may usher in a retaliatory rebound, pessimistic expectations of the previous repair. Long-term recommendation L-PP anti-set, the main logic: the domestic PP production capacity has been put on the peak, in recent years, production capacity growth continued to decline, is expected in 2018 capacity growth rate reached 7.2%, well below the 9-year compound annual growth rate of 11.3 %, While the PE side, both at home and abroad have entered the expansion of production capacity is expected in 2018 the global PE production capacity reached 108.7 million tons in 2020 will reach 125.3 million tons, PE supply pressure was significantly higher than the PP. In addition, the domestic PP industry product transformation is urgent, it is estimated that in 2018 there will be a large number of general-purpose material (homopolymer PP) is replaced by specialty materials (copolymerization PP), homopolymer PP will be in a state of bizarre goods, PP drawing prices provide good Support
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