The domestic CPE (chlorinated polyethylene) market has experienced a period of relative stability in recent times, influenced by a combination of factors. However, the trading atmosphere has remained somewhat sluggish. Although raw material supplies are still constrained, the end of the downstream consumer season has led to a less optimistic outlook for the CPE market, with a continued trend of price consolidation.
In September, the CPE raw material market remained in short supply. Most manufacturers struggled to secure raw materials, and some even had to halt production. At the beginning of the month, downstream demand was relatively strong, allowing smooth shipments. Despite high cost pressures, most manufacturers maintained a high operating rate. However, as the second half of September approached, the downstream market began to show signs of weakness, prompting domestic producers to reduce their output. Many companies now hold inventory, but there was no significant stockpiling expected before the National Day holiday.
Despite the cold climate in the broader plastics market, upstream raw materials remained tight, yet manufacturers were hesitant to adjust prices. Currently, the price range for 135A is between 12,000 to 13,800 yuan per ton, while 135B is priced between 13,000 to 14,000 yuan per ton.
Several factors contributed to the supply and demand dynamics in the domestic CPE market during September. First, China's CPE industry chain remains underdeveloped, with heavy reliance on imported raw materials. This issue became more evident when Liaohua's dedicated HDPE production line was under maintenance. While stronger domestic manufacturers managed to maintain operations by using expensive imported materials, smaller firms had to cut production or shut down.
Second, rising raw material costs have placed additional pressure on domestic CPE producers. The global crude oil price surged, with WTI reaching over $83 per barrel in September. Since each ton of CPE requires approximately 0.65 tons of HDPE, the increase in crude oil prices directly impacted HDPE costs. With tight supply and rising prices, market speculation increased. This year, the price of HDPE special materials has risen sharply compared to previous years, with an increase of nearly 1,000 yuan per ton. As a result, domestic CPE producers are facing intense cost challenges and significant sales pressure.
Third, the market performance was abnormal this year. The summer and autumn seasons saw weaker demand for PVC products than usual, which in turn affected the plastic modifier market—the main consumer of CPE products. The overall demand did not meet expectations.
Additionally, China’s CPE market has its own unique characteristics. Weifang Yaxing Chemical, the world's largest CPE producer, has an annual capacity of 110,000 tons and holds nearly 60% of the domestic market share, along with 40% of the global market. Shandong Province is home to many CPE producers with capacities exceeding 10,000 tons. As a result, the domestic market is heavily concentrated in Shandong, making it highly regionally sensitive. Small-scale producers typically follow market trends closely, with only minor price adjustments made locally. Overall, the market remains stable, with little significant impact from individual players.
Looking ahead, demand from the downstream market in early October is expected to remain flat. The tight supply of CPE raw materials is unlikely to improve significantly. By late October, Liaohua's HDPE production line is expected to resume operations, and with the end of the PVC consumption season, the CPE market will face greater sales pressure. As a result, the market outlook is likely to show a gradual downward trend.
Injection Mould Tray,Hardware Wheelbarrow Tray,Stainless Steel Meat Tray,Wheelbarrow Heavy Duty
Weifang Yida Mould Co.,Ltd , https://www.wfyidamold.com