Downstream demand is too sluggish

In terms of downstream demand, the overall demand of the PE CFR China market remains depressed in 2022. In the first half of 2022, due to the influence of high-priced crude oil, the cost remains high. The price spread between RMB market and PE CFR China market has been too large, and downstream demand is weak to follow up. Most traders preferred to purchase yuan-denominated materials, thus further reducing the demand for USD-denominated goods. Since the third quarter, since its own demand is weak (especially mulching film) and the epidemic continues to occur in various places, the overall demand has always been weak. In July-August, due to the hot weather, under the power rationing policy in Jiangsu and Zhejiang, the operating rate is low, and the demand has been further reduced.