SunSirs: Supply Contraction Support, China POM Speculation Atmosphere remains High

Recently, the domestic POM market has continued to show a positive trend, with spot prices continuing to rise. According to the Commodity Market Analysis System of SunSirs, as of August 14th, the mixed price of domestic POM was 13,550 RMB/ton, a decrease of +5.45% compared to the price level at the beginning of the month.

On the supply side:

Domestic POM companies have recently experienced a high operating rate correction, but due to factors such as unplanned maintenance, the industry load decreased by nearly 3% to about 81% last week. Although the high load situation in the early stage continued, the current inventory is low, and most enterprises have no inventory pressure, and even have negative inventory oversold situations. The tight supply of goods combined with supply contraction has led to sustained strong support for POM supply.

In terms of demand:

At present, the operating level of downstream POM enterprises in China is not high, but due to the stimulation of tight supply, the atmosphere of speculation on the market remains high. The enthusiasm for stocking is acceptable, and the transaction position of the order is high. Overall, the level of spot price support for POM on the demand side is acceptable.

Entering mid August, the POM market continued to rise. The high operating rate of domestic polymerization plants has declined, and the shortage of goods on site has worsened. There is currently no industry inventory pressure, and suppliers have strong support for spot goods. On the demand side, the impact of high temperatures, power restrictions, and other factors may lead to a decrease in the operating rate of terminal enterprises. At the same time, after the rise of POM prices, downstream users' resistance begins to spread. However, the short-term consumption release was boosted by the tightening of POM supply last week. Traders' confidence remains strong, and the sentiment of speculation on the market remains strong. It is expected that the POM market will continue to strengthen in a narrow range in the future.

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