Recently, the procurement of waste EPS is lower and lower as the oil price is declining. So this price decline have influenced the whole plastic industry, especially the plastic recycling industry.
Crude oil continued to drop by the impact, plastic future prices rebound pattern all the way down to 8000 yuan appear after recent retaliatory move up market. From the main driving force of the impact of price and long-term trend, the plastics market prices has not ended.
This rally was partly due to improved demand stage. But from the late situation, we believe the market phased replenishment of unsustainable: on the one hand, the current downstream has gradually started to decline, after entering into January, with the advent of the Spring Festival holiday, lower operating rates continue to decline; on the other hand, before the end of the enterprise funds face relatively tight, businesses replenishment amount basically to maintain normal production operation can be , but the probability is very small stockpile. Therefore, we think the replenishment of the stock market will not last too long.
From the early situation, warehouse receipts, due to the impact of the premium , the number of warrants remain at double-digit levels. From the current situation, due to the slowdown in downstream demand, limited procurement will, adequate cash supply. Spot prices continue to rise, lack of motivation, boost for future market has been relatively limited.
Due to the slowdown in global demand for crude oil, crude oil supplies continue to grow resulting in a surplus in the last two months in oil prices, which for the price of the entire petrochemical industry chain sharp drag. From the company’s production costs, although lower oil prices dragged down the plastic spot prices, but the cost and therefore a sharp fall, which did not have much impact on corporate profits. Decline in demand in the market, increasing pressure on the stock of the situation, there are still large plastic price cut.