Off-Season Pattern Hard To Break, Agricultural Film Prices Stable With A Weak Outlook

[Lead] During the traditional off-season for agricultural films, amid weakening raw material prices and sluggish demand for agricultural films, prices have remained stable. Industry operating rates, orders, and inventory data have all weakened simultaneously. Profits have shown divergent trends, with greenhouse films strengthening while mulch films remain loss-making. In the short term, the market is unlikely to see a significant recovery.

During the traditional off-season for agricultural film, overall market prices for agricultural film have seen limited fluctuations. In North China, quotes for double-anti film are in the range of RMB 10,100-10,700/ton, while quotes for mulch film are in the range of RMB 8,500-8,900/ton. The slight decline in spot raw material prices has become the key factor influencing agricultural film production costs. Prices of LDPE and Mlldpe have fallen more sharply, with LDPE film dropping by RMB 501/ton in a single week. As a result, greenhouse film production costs have decreased, and the theoretical profit of greenhouse film has risen in the short term. For mulch film, the raw material LLDPE fluctuated narrowly during the week and prices rose at the beginning of the week, leading to higher mulch film costs and lower theoretical profit.

Affected by frequent fluctuations in raw material prices, agricultural film enterprises have generally reduced advance stockpiling and maintained low raw material inventories. Among them, greenhouse film producers have slightly replenished stocks due to phased concentrated production, leading to a modest increase in raw material inventories. Mulch film production has continued to decline, with enterprises relying on existing inventories to maintain production, accelerating the pace of raw material destocking.

Recently, some enterprises have received sporadic supplementary orders for greenhouse film from parts of southern China, but most are short-term small orders with limited room for growth. A small number of short-term orders have enabled greenhouse film producers to concentrate production in phases, leading to a slight uptick in operating rates. Mulch film, affected by a continued decline in demand, has seen enterprises successively reduce operating loads or even halt production for maintenance, directly dragging down the operating rate of mulch film production.

Market pessimism toward the raw material outlook has intensified, with nearly 30% of enterprises believing that polyethylene prices will decline in the later period. Weak demand in the off-season is constraining raw material procurement, and the subsequent accumulation of petrochemical inventories may drive raw material prices downward.crude oilGiven the current off-season conditions at downstream terminals and the market outlook, polyethylene raw material prices are likely to remain range-bound next week. Agricultural film lacks support from concentrated order intake, making it difficult for operating rates, orders, and raw material inventories to improve significantly. Overall, the supply-demand situation in the agricultural film market is unlikely to change in the short term. Agricultural film prices are expected to remain stable with a weaker tone and fluctuate within a narrow range. Mainstream agricultural film quotations in North China are likely to continue moving within the current range, with mainstream prices for double-protection film in North China expected to be around RMB 10,100–10,700/ton. (Personal view, for reference only.)