SunSirs: Cost Surface Savings Good but Downstream Demand Weak ABS Price Adjustment

　　1.Price Trend

　　According to the data of the Sunsirs, the domestic ABS market was in a narrow fluctuation in August, and the price was stable temporarily. As of August 29, the mainstream offer price of general-purpose ABS was about RMB 1290.00/ton, up 0.78% from the beginning of the month.

　　2.Cause analysis

　　Industry chain: ABS upstream, in early August by international oil prices, pure benzene continued to fall, styrene market prices continued to fall, a larger decline. In addition, the external news continued to be negative, domestic enterprises stepped up inventory, most enterprises reduced prices and promotions, merchants have a higher intention to deliver goods, let profits go single. In the middle of the year, the news of the easing of Sino-US trade affected the on-site environment temporarily. The price of most domestic enterprises has been revised back, and the demand of the downstream main body remains at a low level, so the purchasing strategy of just-in-demand has been adopted. At the end of the month, the international crude oil market continued to improve, the overall oil price shocks up, the US dollar rose, giving styrene cost support. After the whole Styrene Market rebounded, it maintained a high level, while the profit margin of the production enterprises decreased slightly, because the prices of pure styrene and ethylene began to rise. At present, the domestic production plant is relatively stable, the production and marketing of enterprises are stable, and the spot supply is still tight. It is expected that the price of styrene will rise slightly with the cost rising in the near future.

　　This month, the domestic butadiene market rose, the external market was high, the domestic manufacturers had no obvious inventory pressure, and the state-owned synthetic rubber plant operated steadily. In the downstream of East China's new output supply contract, there is no spot inflow into the trade link for the time being, and Sinopec's internal supply is relatively tight, butadiene market performance is relatively strong.

　　In August, the spot supply of acrylonitrile-related products was slightly tighter, downstream demand maintained just demand, and supply and demand in the field basically balanced. Downstream rubber market is weak, some private enterprises parking. However, the acrylonitrile inventory has been reduced to a low level, and the mindset of the operators is stable. In recent years, domestic acrylonitrile quotation is relatively stable, the market is flat and tidy; ABS upstream support is still acceptable, downstream household appliances industry demand is weak, the market as a whole is short of gas. Domestic ABS shock adjustment in August.

　　3.Future Market Forecast

　　Sunsirs analysts believe that: August domestic ABS offer narrow shock adjustment. Upstream three materials on the cost side support the cost side is still acceptable, and the mid-term Sino-US talks to ease the release of news are positive. However, in the context of imbalance between supply and demand, downstream purchasing is negative, and the mindset of the traders is more wait-and-see. Bad market trading drags down ABS market, and bearish bulls pull each other. It is expected that the recent ABS offer trend will continue to shake the whole market.