For several weeks, the experts of the Plastics Industry Media Group (the owner of this portal) have repeatedly warned about the pseudo-false methods of the PDID Office of NPC for polymers’ base price definitions at the group’s Persian website (http://pimw.ir), but given the pitfalls of this week’s PDID office, and contrary to the expectations of the pricing commission, this week the polymer trades market was once again in a state of recession, so that the industry owners turned the issue into problems with the newspaper. The following analysis is a summary of expert reviews.
On the stock exchange the trade market of polymers are still calm and the purchasing appeal has fallen sharply. In the last few days, less than half of the offers were traded, indicating that the tough trading situation is still ongoing. This situation has to be taken seriously, because its continuation means a loss to the converting industries, and it can, of course, indicate a breakthrough in the stagnant step in this important industrial sector. Meanwhile, the weekly trading statistics provide more transparent data for review.
Of course, what is currently being investigated is the relative weakness of demands that does not allow the booming of the markets. This data is visible both in commodity trading of the stock exchange and in the domestic free market. Whereas, no one can see any general improvement in demand and market conditions for polymers after the end of Ramadan. Perhaps the weakness of demand in the converting industry could be the best reason for this overall weakness, although the prices for final products and raw materials could be one of the other reasons for weaknesses in demands and trade volumes.
In general, the US$ value as one of the factors of price definitions, is relatively high for stock quotes, and there is no guarantee that the rate will not increase again. Surprisingly, At this situation of the weak demand, we do not see the drop in commodity prices on the stock exchange, and only the weakness of demand can be tracked in this regard. From now on, it will be more possible to intercept the footprint of the recession in different markets, although in the coming days it would be better to comment.
The weakness of trading on stock exchange should be taken seriously as the cost of this incident affects the various sectors of the industry, in the face of the unconsciousness of the difficulty of exporting raw materials, and if, for any reason, the domestic market is weakened, this weakness will lead to the majority of production losses. The upside of the US$ value has already been the main reason behind the rise in stock exchange rates over the past few weeks, and if this trend is not corrected in any way, the market may be restrained and the situation will be even more difficult than before.
The other day (Tuesday June 18th), more than 63,000 tons of polymers were supplied to the IME market, which is a significant figure. In the face of this volume of supply, less than 32,000 tons of trading were recorded; that is, the actual demand figure was nearly half of the supply, which is a strange and insignificant data in the Iranian polymer market. Eventually, nearly 26,000 tons of polymers were traded on stock exchange, which is not a significant figure for this market. This situation reflects the hard days of the polymer market, and if the trading mechanisms and demand growth do not change, today’s hard days will continue to be harder and even worsen.
The market for petrochemical products is on its recovery path. This means that part of the demand for a suppressed purchase is activated in the free market, and as demand grows, we are seeing an increase in the volume of trades, which, of course, is taking place in the stock market and in the same way. Though, the general trend of prices is declining, which is somewhat justifiable considering the base prices of some grades in stock exchanges, but the total overall conditions of the market is somehow completely different.
So far and during recent weeks, the fluctuation trend of prices has been on the downside for domestic market, and the downtrend has continued until yesterday. The same decline, although experienced along with falling base prices and falling global prices, should also take into account the serious weakness of demands. This overall situation means that with the fall in commodity prices at stock exchange, the market has experienced a bigger retreat to eventually keep the prices low.
Of course, the market situation is such that even these prices are also expensive for buyers, so that they do not support the overall willingness to buy. Simply put, although the current prices in the market are relatively balanced, we still do not see higher purchases, although some data unconsciously reflects the potential for improved demand and expectations for market prosperity.
