SunSirs: No Pressure on Inventory, POM Market continues to Rise

In mid July, the domestic POM market continued to be actively shipped, with spot prices rising. According to the Commodity Market Analysis System of SunSirs, as of July 14th, the average factory price of domestic POM was 11,675 RMB/ton, a +5.18% increase or decrease from the price level at the beginning of the month.

Last week, the price of formaldehyde in the Shandong region increased. The situation of raw material methanol has also increased, and the cost side has strengthened. However, the expected increase in supply and inventory, as well as the poor operating rate of downstream sheet metal factories due to high temperature weather. It is expected that the recent price of formaldehyde may be strongly related to the rise and fall of raw materials.

In terms of supply: The operating rate of domestic POM enterprises has remained high recently, and the maintenance plan for enterprises will be announced in the morning in the future. Currently, the industry's load is about 94% close to full capacity. The high load situation continues, but after recent destocking, most enterprises have no inventory pressure and have a negative inventory situation, leading to a tightening of supply.

In terms of demand: Currently, there is a decrease in POM supply on the site, and the enthusiasm of terminal enterprises to stock up has been strengthened. However, later restrictions on electricity and other factors may continue to affect downstream enterprises' operating rates, and the release of consumption will be affected, limiting the driving effect on spot prices. Traders have decent confidence.

The POM market rose last week. The operating rate of domestic polymerization plants remains high, and there is a tight supply of goods on site. There is currently no industry inventory pressure, and suppliers have strong support for spot goods. On the demand side, downstream enterprises have started construction on a low level and the order situation is average. There is currently some bullish sentiment on the market, and it is expected that the bullish sentiment in the POM market may weaken in the short term due to the impact of off-season demand.

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