BOPP is still the main tone

In 2012, the BOPP (biaxially oriented polypropylene) market started steadily. Although the upstream raw materials rose slightly and faced with favorable influences such as the growth in annual demand, market prices rose slightly, but there were negative factors such as difficulties in liquidity in the production companies. Under the influence of the market, the road to a better market has not yet been unimpeded, and the prices in January remain flat.

There are two favorable factors in the current BOPP market: one is that raw material prices are slightly higher. Due to the significant loss in the previous period, polypropylene has recently reduced its import supply, which is good for the domestic market. At the same time, domestic inventories have fallen, and the current low and medium warehouses have been maintained. Coupled with the high crude oil prices, petrochemical enterprises have taken advantage of the increase in polypropylene prices. The price increase per ton last week was about 200 yuan, which boosted the BOPP market and the price of ton also followed up slightly. yuan. Polypropylene is expected to be dominated by the consolidation before the Spring Festival, and the ton price is between 10250 and 10350 yuan.

The other is the increase in downstream demand. The Spring Festival is approaching, it is the packaging and printing season. Membrane plant orders significantly improved, demand increased, more orders, operating conditions and the status of orders have greatly improved over the previous period. Most membrane plant installations are in normal operation, and the operating rate is around 70%. The production capacity is about 30,000 tons. From the perspective of the company, Fushun Petrochemical delayed repairs to the after-spring of the Spring Festival due to equipment maintenance; Jiangyin Kangde new plan to drive in March; Baoding Fubao plans to transform the equipment to produce heat sealing film and matting film during the Spring Festival. These news support the market. At present, all kinds of costs have been eliminated. Film makers still have certain profits and their willingness to start construction has increased.

However, the current negative factors in the market also constrained the BOPP market price to rise further.

One is that the Spring Festival holiday is approaching, and there will be no more trading days for January, and most downstream companies will reduce their stocking needs. At present, most of the membrane plants mainly take production orders. With the arrival of the Spring Festival, the willingness to receive goods will also drop.

Second, the increase in repayment pressure on membrane makers in the past year, especially due to poor long-term shipments and high operating costs, has made it difficult for manufacturers to continue their operations. Downstream companies also have financial difficulties, and the operating rate has not been effectively improved. The status of production and operation has not improved and there is no intention of stocking. It is difficult to form a large-scale demand.

Third, the membrane plant inventory is high. Affected by the continuous observation and purchase of the lower reaches of the previous period, the inventory of membrane plants was generally high. The contradiction of oversupply has always been a stumbling block to the BOPP market. At present, the market is mainly based on destocking, and there is a strong willingness to clear positions.

Fourth, the economic situation at home and abroad combats market confidence. The European debt crisis is difficult to reach an effective solution, and the international market economic environment remains weak. The tightening momentum of the domestic monetary tightening policy is limited, and the economic outlook in 2012 is complicated and ambiguous. “Below and high” has become the consensus of experts. In this case, confidence in the market at the beginning of the year is clearly insufficient, and the majority of bears are short sellers.

In summary, the BOPP market is intertwined with short- and long-term factors. Although upstream raw materials have been boosted, but before the Spring Festival, there are not many market trading days. The willingness of the membrane plant to clear the market is relatively strong. The downstream plant will start the Spring Festival holiday and form a large single year ago. The chance is small, so the BOPP market will continue to be stable and remain flat.