Manufacturing Purchasing Managers' Index (PMI)

India

In September, although the Indian manufacturing industry continued to expand, the PMI rate decrease to 55.1%, down by1.1%. Delimah, chief economist for India at S&P Global, pointed out that although India's manufacturing expansion has slowed down, due to inflation, raw material prices goes up and bad weather, Indian manufacturing has had to raise terminal prices to some extent. hit demand.

China

In September, manufacturing PMI of China increased to 50.1%, up by 0.7% compared to August. Driven by the traditional peak season, the supply and demand of the manufacturing industry has recovered but the magnitude is not as good as in previous years. The PMI of the construction industry rose at a high level in September, while the service industry was suppressed by the epidemic and declined. It is expected that there will be greater downward pressure on exports and social zero in September, infrastructure investment will maintain a high growth, and the decline in real estate investment growth will narrow. Looking ahead, the economy will improve after the policy of stabilizing growth is implemented. Considering that there is not much room for short-term improvement on the supply side, and the demand side is suppressed by repeated epidemics and weakened external demand, the market needs further stimulus to enhance the endogenous driving force for economic recovery.

Figure 1 Southeast Asia, India & China Manufacturing Purchasing Managers' Index (PMI) Comparison in 2021-2022 (%)

Notes: If PMI above 50 percent, it reflects the overall economy is expanding; if less than 50 percent, it reflects the overall economy is in recession.

Source: S&P Global, National Bureau of Statistics of People's Republic of China.

Spot Market Analysis

Market Overview

India：TDI market prices in India rose slightly this week. October is the traditional peak season in the Indian market, the demand of the downstream industry is better, and because the Chinese market price is rising rapidly, exporters are waiting for new quotations, China, Japan and South Korea have recently exported only a small amount of TDI, which further drives the TDI price in the Indian market.

China：China TDI market rose at an accelerated pace this week. During China National Day holiday, the market was still active. After the holiday, TDI prices jumped sharply under the firm support from the supply side. Major suppliers successively raised guide prices by a wide margin. Covestro's facility failure and Wanhua Chemical's routine maintenance made the overall industrial operating rate drop to around 30%. Besides, the logistics in Xinjiang was hindered due to the local epidemic, and spot goods continued to be short. Goods in the secondary market was also rare, and downstream manufacturers had limited inventories. So TDI quotations kept rising sharply. Traders controlled the supply and chose to deliver high-priced orders. Negotiated prices moved upward strongly.

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