Returning from the Chinese New Year holiday, PE market has entered a new phase of game-playing. During the holiday, crude oil prices remained relatively strong, directly driving up futures trends on the first working day after the holiday. Petrochemical plants followed suit by slightly raising ex-works prices for some varieties. Has the market thus ushered in a good start? However, feedback from the market indicates that due to limited resumption of operations downstream, although prices for some varieties in certain regions have increased, some other regions are experiencing price fluctuations and a wait-and-see attitude. Additionally, considering the accumulation of domestic petrochemical inventories and changes in plant operating rates, whether the good start can be sustained remains uncertain. This article mainly compiles statistics and summaries of some data after the Spring Festival.

1. Crude oil and futures

During the Spring Festival holiday, crude oil, along with precious metals such as gold and silver, led the gains in the commodity market. Geopolitical risks remained the core driver behind the upward trend in oil prices. Compared to pre-holiday levels, WTI oil closed at $66.31/barrel after the holiday, an increase of 5.44%; Brent oil closed at $71.49/barrel, up by 5.52%. Supported by strong crude oil prices, most domestic chemical futures markets saw gains. Among them, LLDPE futures opened at 6730yuan/mt on Feb 24th and closed at 6820 yuan/mt, rising by 139 yuan/mt, an increase of 2.08%.

2. The ex-works price of petrochemical plants

On Feb 24th, some petrochemical plants adjusted their ex-works prices, with the majority implementing increases.

3. Petrochemical Inventory

Currently, petrochemical inventories stand at 940kt, an increase of 480kt compared to before the holiday. The extent of inventory accumulation is relatively unchanged from last year and is also largely in line with the forecast.

4. Plant operating rate

During the Spring Festival holiday, some units shut for maintenance and some restarted. Overall operating rates have increased significantly, with the comprehensive operating rate standing at 89.12% on Feb 24th.

5. Resumption of operations

Based on the information gathered so far, petrochemical sales departments and traders have basically resumed full operations. Individual companies that are still on holiday are also able to offer remote quotations and sales. Regarding downstream factories, apart from some large plants that have resumed normal production, most small and medium-sized factories are initially planning to gradually return starting in March.