In terms of demand, last week (Oct 21st-28th) the market situation for petrochemicals was in a better position than the past, which could be a sign of growth in downstream industries. As far as the conventional commodities are concerned, altogether, nearly 90% of the products were purchased by the applicants, at the same time, 80% of all supplies were purchased last week. In the meantime, 39 offered grades out of the 75 grades sold with the competitive prices were something between 1 to 23%.
According the the reports of PIMI Economical Analysts, last week, the Polymer Market experienced favorable conditions for the stock market to grow 13% and to more than 60,000 and 500 tonnes. The importance of this volume of trading can be checked on this point, which is the highest since late April of this year.
While supply volumes in the Commodity Exchange Polymer Group grew to 4.5 percent, this growth was expected to boost the volume of trading, assuming some of its attractiveness. Increasing supply in groups such as linear or heavy extrusion can be evaluated in this framework as it contributed to the growth of trading volumes but still did not cover the demand on the market in full. Market demand appears to be in a favorable position, which can lead to increased trading volumes and also increase the volume of production in the downstream industries of petrochemicals.
According to the report, the demand situation in the market for chemical products is the same as the volume of demand in this market has been at the highest level since November this year, but the volume of trading is relatively balanced. These conditions still reflect the attractiveness of buying and the growth of prices in this market, indicating that, given the growth of supply, the volume of trading will be favorable. Of course, the increase in demand can be seen as a signal of global oil price growth, but in general, the petrochemical market is showing a boom in the last few weeks.
An important point of the past week should be the elimination of the price caps on commodity exchanges for different grades of polypropylene, which has been approved by the competition council. While the expectation to increase the supply volumes in this market can be considered as the main reason for lifting the allowed ceiling, that is, assuming growth in supply, this decision has been made.
In the first week of November, according to this approach, we witnessed a relative relaxation in the textile polypropylene market, but the chemical market (CHP) has become more inflammatory than before, as supplies are still not responsive to demand. Of course, one can not take a decisive stance on the prospect of that decision, as the volume of future deliveries will determine the market share.
Given the experience of previous years and if this new approach fails, the 10% price caps can be quickly implemented, so if the inflammation increases in this market, it will not be difficult or time to return to the previous situation. It seems that the attention of the petrochemical companies to supplying the stock exchange and the potential for the removal of the price ceiling can lead to better conditions for all sectors of the market so that both the supplier delivers the economic benefits and the consumption It can provide the basic material with ease. In the event of a failure of this scheme, the operating body will definitely favor the import of more raw materials, which will not be a positive signal for domestic supplier units.
The following table shows all polymers that have been purchased via the IME hall under the category of polymers. You can also download the file for the long list of all polymer deals during last week here:
Polymers ODTv Index for 21-28 Oct
