【Analysis of market conditions】：
First of all, on the one hand, the upstream double control and production reduction, while the Jiangsu, Zhejiang, Shanghai and Guangdong regions also have downstream power and production restrictions. The current market has become a pattern of both supply and demand tightening. In terms of monthly difference, it is still in a strong upward pattern. But the market is no longer suitable for bearishness. The worst is also a volatile market, and the medium-term may continue to be strong, because the expected supply contraction has greatly changed the market's established expectations of overcapacity.
Second, in the context of skyrocketing ocean freight and shortage of containers, there will always be a gap at the PE import side, which offsets the pressure of its capacity expansion, and the shortage of goods in the market results in a strong PE spread. At the same time, the supply-side inventory is low. According to our actual research, although the downstream demand is slightly under pressure, it has been stocking at a low level. Therefore, after experiencing supply expansion expectations in the third quarter, the market is still low in inventory, which means that the difficulty of falling has become a market consensus. This will further promote the enthusiasm for low-price stocking in the downstream. The subsequent expansion of transactions and other factors will be the spark that ignites the market.
Third, fiscal easing, monetary easing, and inflation are major trends, and there should not be too much hesitation. We need to see that the epidemic is there, and fiscal easing and monetary easing are there. The fiscal contraction in the first half of the year was affected by the previous strong inflation expectations. With the re-emergence of deflation expectations, fiscal easing in the fourth quarter will continue in order to prevent economic stalls, resulting in a sharp increase in commodity prices in the fourth quarter.