Shenhua Auction: Firmer futures lift PP and LLDPE buying interest despite seasonal caution
The positive correlation between the Exchange-led sentiment and the physical auction floor prompted a successful 97.8% deal rate for homo-PP yarn, while PP block copolymer achieved its third consecutive full sell-through.
Shenhua Baotou Coal Chemical Co., China’s largest coal-based petrochemical producer, concluded its auction on 07 January 2026 with a notable improvement in deal momentum across both PP and linear LLDPE segments. The session was underpinned by a sustained rebound in futures markets, allowing the producer to implement modest price hikes while maintaining healthy sell-through rates.
|
Product |
Auction Volume |
Deal Volume |
Auction Prices |
Deal Prices |
Deal % |
||
|
CNY/ton |
USD/ton |
CNY/ton |
USD/ton |
||||
|
Combined and reported by CommoPlast |
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|
PPH Yarn |
1600 |
1564 |
5950 |
$753 |
5950-6350 |
$753-804 |
97.8% |
|
PPBC Inj |
60 |
60 |
6000 |
$760 |
6060-6070 |
$767-768 |
100.0% |
|
LL Film |
800 |
650 |
6150 |
$779 |
6250-6430 |
$791-814 |
81.3% |
|
*Auction and Deal volumes are in tonnage *All USD equivalent prices only exclude the 13% value-added tax (VAT). They have not taken into account other costs that might incur in the selling process, i.e. import duty, customs clearances. |
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Auction platform: https://www.e-chnenergy.com
Auction time: Monday – Friday, 10 AM – 12 PM
Key takeaways
A firmer rebound in May 2026 futures on the Dalian Commodity Exchange (DCE) provided the necessary support for Shenhua to raise auction prices by CNY 50/ton compared to the previous session. The positive correlation between the Exchange-led sentiment and the physical auction floor prompted a successful 97.8% deal rate for homo-PP yarn, while PP block copolymer achieved its third consecutive full sell-through.
Despite the upward adjustment in asking prices, buyer engagement remained resilient. LLDPE film recorded a significant recovery, with the deal rate climbing to 81.3% from Tuesday’s 62.5%. Market participants noted that the calm tone that characterised the initial post-holiday sessions has gradually shifted toward active replenishment, as converters move to shore up inventories against a backdrop of rising cost-push pressures.
However, industry observers maintain that the current uptick is predominantly tactical. While some converters are purchasing larger volumes on expectations of further price appreciation, the broader consensus remains anchored in hand-to-mouth procurement. A local player described the current atmosphere as one of "measured participation," citing a visible reluctance to chase aggressive hikes as the market approaches the Lunar New Year holiday.
Looking ahead, the sustainability of this rebound hinges on the durability of the DCE futures rally. Participants remain wary of potential inventory accumulation at both producer and distributor levels as industrial activity traditionally decelerates ahead of next month's festivities. While current replenishments provide a short-term floor, the looming seasonal slowdown is expected to cap sustained upside momentum in the immediate post-holiday period.
Written by: Kat Yun Yun
Edited by: Aiman Haikal