Supply Factor Expected To Provide Cushion For China PS Prices Amid Seasonal Slowdown
- Local PS prices moved in a different direction
- PS demand is slowing down
- Local PS prices predicted to fluctuate between CNY100-200/ton ($14-28/ton)
As China PS market is on the brink of seasonal slowdown, sources contacted by SSESSMENTS.COM expect the relatively tight domestic supply will be able to provide cushion for prices. For the week commencing May 25, local PS offers in China market captured moving in a different direction. In comparison to a week earlier, a local producer decided to trim the offers for GPPS Injection and HIPS Injection by CNY100/ton ($14/ton) as the hype from a new safety regulation “one head, one helmet” has cooled down. While another producer decided to keep the offers for GPPS Injection and HIPS Injection stable on a weekly comparison. However, some traders decided to increase the offers between CNY100-200/ton ($14-28/ton) from last week considering the relatively tight local supply. From the import market, offers for GPPS Injection of South Korea origin maintained stable, while HIPS Injection offers of the same origin increased by $20/ton compared to a fortnight ago. The South Korean producer’s source revealed that the sales for both GPPS and HIPS cargoes this week were satisfactory and done deals were concluded at the initial offer levels.
As the hype from the new safety regulations has cooled down, sources stated to SSESSMENTS.COM that the demand for PS in China is slowing down. Although the supply is relatively tight, the traditional low season which takes place from June to July has started to affect buying sentiment. Sources added that downstream converters still keep the procurement on an as-needed basis while traders remain cautious in making procurements. On the supply side, SM inventory in coastal China recorded at 288,100 tons as of May 28, increased by 10,800 tons from last week. While from the traders’ end, the inventory increased by 6,800 tons from a week earlier, stood at 189,100 tons.
For the outlook, market sources expect local PS prices to fluctuate within a limited range of between CNY100-200/ton ($14-28/ton). Although the demand is predicted to slow down coming into the traditional season, the relatively tight supply stemming from the ongoing maintenance shutdown at some local producers’ plants is expected to provide cushion for prices. Hence, there would not be any significant changes in local offers in the near term, SSESSMENTS.COM was told.
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