Wed 4 Sep 2019 11:37 0 206

A report on Petrochemical products market, 4th week of August 2019

New hopes for further rise in demands

New hopes for further rise in demands
The weekly average governmental exchange rate has fallen to 113,000 IRR and if the current circumstances continue, the exchange rate will keep falling further.

According to Wikiplast, the amount of demands has experienced a slight increase and this resulted in limited growth in market and the amount of trades. These signs are promising for the next week.

The growth witnessed in the amount of demand and trades can be considered good signs for the market, but we still have to wait and see.

We had a 5% growth in the amount of trades, but these numbers are still considered weak.
Maybe the holidays of this week and last week have a part to play in the situation of the market. It is, therefore, not possible to make stable assumptions.

The market is still weak and it can only recover by means of a considerable rise in the amount of trades. If this amount is stabilized somewhere above 50,000 tons per week, we will be able to say that the market has recovered.

The market is not so busy and there is no news for the press to cover. The only news is the tendency to drop the prices in the global market as well as the fluctuation of governmental and free exchange rate. The free rate is not falling as quickly, but the current atmosphere supports the declining trend.

The weekly average governmental exchange rate has fallen to 113,000 IRR and if the current circumstances continue, the exchange rate will keep falling further.

This will probably result in lower prices in the next week. The decreasing trend is not certain, though highly probable.
The price will be generated by the price generator, and the price generator will not tend to move against the flow of the market, even if that means accepting high levels of fluctuations.

The unusual activity of this week was the increasing trend witnessed on Wednesday, which took place in spite of the dropping exchange rate and base prices.

In the last hours of trading, the market showed little tendency to buy and the increasing prices picked up a slower pace.

The key here might be the decreasing trade rate which results in lower amount of offers while the demands have been stable.

This can be concluded to increase the prices and we can tell that the market is on the road to improvement.

However, this can only be proven when we have a trade rate above 45,000 tons per week.

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