In 2019, China's rubber and plastics industry market continues to be sluggish. Although there have been occasional improvements, the overall ups and downs remain unchanged.

According to price database from SunSirs, in the 2019 commodity price list, there were 2 types of products that rose from the previous month, of which there was a type that increased by more than 5%, accounting for 6.3% of the number of monitored products in the sector. The Top 2 products are natural rubber (13.90%) and PVC (4.94%).

There were a total of 14 types of products that fell month-on-month. 12 out of 14 have a decline of more than 5%, which accounted for 75% of the monitored products in this sector. The top 3 products were PC (-38.74%), PA66 (-36.16%) and PA6 (-22.76%). The average decrease this year was -13.77%.

RUBBER INDUSTRY

Natural Rubber: In the first half of the year, “disasters and hardships” in 2019. Nature rubber industry experienced droughts that were not encountered for many years. Meanwhile, it experienced strict inspections of the “mixed rubber” by the customs. And it also encountered export reductions in three Southeast Asian countries and other rubber boosting measures. Those result in rubber price rushing high first and then falling back to shocks.

In the second half of the year, the traditional consumption season of "Golden September and Silver October" has boosted rubber prices. Due to the impact of tight production in Southeast Asia resulting from heavy rains and fungal diseases, the natural rubber market has improved somewhat. In November, China domestic production areas stopped cutting in November, which stimulus the price. Prices stopped falling and rose strongly, pulling up strongly. After pulling up again in December, the price fluctuated and the price rose by about 12% throughout the year.

Synthetic Rubber: In 2019, the domestic general synthetic rubber market fluctuated in the whole range, which was stronger in the second half than in the first half. From January to July, butadiene fell all the way. The cost of raw materials fell sharply. General synthetic rubber production companies have a high operating rate driven by profit. Market has sufficient supply, and downstream procurement continued to be weak, which weighed on prices.

From the beginning of August to the end of December, the price of domestic general synthetic rubber fluctuated steadily. The impact of the fluctuations in the prices of crude oil and raw material butadiene increased in the second half of the year. The operating rate of tire factories was relatively good.

PLASTICS INDUSTRY

2019 can be said to be a bumpier year for plastics. In addition to the slight increase in PVC throughout the year, plastic products were mainly green. Regardless of the turbulent changes in the external environment, the market is always in a downward trend. The reason is due to the further deepening of the imbalance between supply and demand. The competition in the industry is becoming increasingly fierce, and profits are squeezed.

In addition, the intensity of environmental protection inspections has continued, and since the "blue sky defense war" was proposed in 2017, it has always had a significant impact on the market. The intensity of environmental protection has increased year by year, which has led to the obstruction of production by terminal enterprises.

All major varieties in the plastic market ushered in favorable conditions in September, but the rally was fleeting. In October, the whole plastic market was in dilemma again. At present, it is difficult to reverse the tight pattern between supply and demand in 2020. In addition to the large fluctuations that may occur during the maintenance season and downstream traditional procurement season, the overall trend may remain weak.

Key ups and downs: natural rubber, butadiene rubber, styrene butadiene rubber, PC, PA66 and PA6

Natural Rubber (+ 13.90%): Compared with the price of more than 40,000 a ton, the price of natural rubber has fallen by three-quarters, and the low price range is around 2,000 RMB / ton from 10,000 RMB / ton to 12,200 RMB / ton. And it has been in shock for more than half a year.

In 2019, the price of natural rubber as a whole surged three times: 12,070 RMB / ton on March 4 was the first price high, 12,020 on June 11 was the second price high, and 12,290 RMB / ton on December 6 was the three times is also the highest price of the year so far.

Two downward troughs: 10,700 RMB / ton at the end of April and early May is the first trough price, and 10,260 RMB / ton at the end of July and early August is the lowest price this year. Throughout 2019, the average price of the natural rubber whole milk (Treasure Island) market monitored by the business agency in East China rose 14.55% throughout the year. In 2020, the natural rubber market, as the suppression of low prices for many years, is unlikely to fall in price. The short-term holiday effect is obvious. More Focus on sudden price changes caused by news stimulus and policy impact.

Butadiene Rubber (-3.63%): In 2019, butadiene rubber showed a volatile trend. Taking August as a watershed, before August, the price fluctuated in a narrow range. After August, butadiene rubber formed a trend of roller coaster after rising first and then falling.

The annual high price of butadiene rubber appeared at 12,900 RMB / ton on September 27, and the low price appeared at 10,450 RMB / ton on July 18. The annual increase or decrease was -3.63%.

Styrene Butadiene Rubber (-5.17%): The styrene butadiene rubber market in 2019 showed a downward trend and then an upward trend. In the first 7 months, the domestic styrene-butadiene rubber price has been on a downward trend, from 12,000 RMB / ton at the beginning of the year to the lowest point of 10,112 RMB / ton in July.

The domestic styrene-butadiene rubber price fluctuated from early August to the end of December, from 10,400 RMB / ton in early August to around 11,700 RMB / ton at the end of the year. At the end of the year, it was down 5.17% from the beginning of the year.

PC (-38.74%): The price of PC in 2019 shows a downward trend. Up to December 30, the average domestic PC price was 12,966.67 RMB / ton, and the price fell 38.74% from the beginning of the year. The contradiction between supply and demand is the most important factor in lower prices.

Due to the long-term decline in the market, the profit margin has been compressed, coupled with the historically low bid prices. Merchants continue to allow profit shipments, and there is no pressure on inventory. In 2020, the PC market still has room to rise.

PA66 (-36.16%): The PA66 market price in 2019 is quite different from the rapid advance in 2018. In 2019, the spot price of PA66 fell weakly. The imbalance between supply and demand is the main feature of the domestic PA66 market in 2019.

Up to December 30, the average price of mainstream PA66 bids was around 23,087 RMB / ton, a decrease of 36.16% from the beginning of the year.

PA6 (-22.76%): The overall ABS market in 2019 has fallen, and the spot price in the domestic market has shrunk to a certain extent. Affected by the unsatisfactory trend of upstream caprolactam throughout the year, and the lack of upward momentum for PA6 itself, the downstream demand growth rate did not match the increase in production capacity, and PA6 fell 22.76% throughout the year.

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