The impact of RMB depreciation on the import and export trade of the plastics industry

The depreciation of the renminbi, the most direct impact on the plastics industry is import and export trade. In recent years, with the introduction of new domestic production capacity, the import dependence of the plastics industry has declined, but for some high value-added materials, imports are still the mainstay, and in the commodity circle, the import dependence is still high. a part of it. The depreciation of the renminbi will increase the procurement costs of importing enterprises, but it will also stimulate the export of downstream products.

In recent years, the contradiction of oversupply in the plastics market has become more and more obvious. Coupled with the recent weak market conditions, the purchasing power of imported raw materials will decline correspondingly in the case of RMB depreciation. Because of the depreciation of the renminbi, it has a significant impact on the recent arrival of imported goods, the increase in import costs and the increased risk of merchants' late orders, which will reduce the psychological expectations of traders to order future products. Moreover, due to the increase in the cost of imported goods, the competitiveness in the domestic market will be weakened, which will cause downstream users to reduce the demand for imported raw materials, and turn to find domestic raw materials that can be replaced, thereby strengthening the price competitiveness of domestic plastic raw materials. This is a good performance for the domestic plastics market.

Finally, for export-oriented enterprises, the depreciation of the renminbi is the driving force. Despite the small amount of domestic plastic raw materials exported, it is currently not affected by the depreciation of the RMB. But in general, it also brings good results that increase economic returns. On the other hand, it also stimulates the export of downstream plastic products, which in turn increases the demand for raw materials.

Reinventing the commodity market

Prior to the rapid growth of China's economy, the demand for bulk commodities such as crude oil and precious metals was quite strong, triggering a long bull market for commodities. But now China’s economic downturn has increased, and commodities are clearly under pressure. The trend of the renminbi is often in sync with commodities, and the depreciation has made the already weak commodity market even worse. For the crude oil market, the depreciation of the renminbi means that China's import of crude oil is more expensive, thus curbing oil consumption, and the market supply and demand conflicts are once again intensified. In general, the rapid depreciation of the renminbi has made oil prices worse, and the weak pattern continued in the later period.