August 29th China PP Market Update

Domestic petrochemical inventories: Polyolefin inventories of both crude and crude oil products reached 645,000 tons, down 25,000 tons from yesterday.

Futures Analysis: The PP2601 contract price fluctuated narrowly in the evening session on August 29th, with the price center of gravity gradually shifting downward. The price continued its volatile trend in the morning session, weakening slightly, and fluctuated downward in the afternoon session. Opening price of the 01 contract increased by 31,778 lots.

The opening price was 7020, the high was 7025, the low was 6967, with a spread of 58. Open interest was 528,243, and the settlement price was 6992. Yesterday's settlement price was 7013, a decrease of 21. Daily trading volume was 217,926 lots, with deposited funds of 2.579 billion yuan and inflows of 139 million yuan.

Mainstream market quotes for wire drawing:

Domestic spot market analysis: Today, the domestic PP market showed an overall stable but slightly weak trend. Market prices in North China and Northwest China have declined, with price reductions ranging from 20 to 30 yuan/ton. Market prices in East China, South China, and Southwest China have remained stable. Regarding prices, the mainstream domestic polypropylene price ranges from 6,820 to 7,090 yuan/ton.

The current PP market is characterized by a weak supply-demand balance and suppressed market sentiment due to futures prices. On the upstream production side, mainstream quotations from companies remain stable, with only a few companies lowering their ex-factory prices by 20 to 150 yuan/ton based on their inventory levels and planning.

The overall supply-side price structure remains stable. In the midstream trading sector, traders are generally adopting a proactive, profit-sharing pricing strategy to accelerate inventory liquidation and boost actual transaction volume, significantly increasing price elasticity at the market circulation level. On the downstream side, due to the industry's off-season, end-user demand remains weak.

Companies are mostly maintaining a "buy on demand, control inventory" approach, with little willingness to proactively replenish inventory. Coupled with the impact of volatile declines in futures prices, market participants are cautious about the outlook, resulting in a relatively subdued trading atmosphere.

Market Forecast: The current crude oil market is experiencing a mix of positive and negative factors. The positive factors primarily stem from the continued US sanctions on oil-producing countries and the ongoing uncertainty surrounding the Russia-Ukraine situation.

These factors are supporting international oil prices and indirectly providing some support for PP costs. On the negative side, the easing of the Israeli-Palestinian tensions has weakened the safe-haven premium, OPEC+ has maintained its production increases, and the sluggish global economic recovery has weighed on end-user demand expectations, all of which are constraining the PP market's momentum.

The domestic PP US dollar market, supported by cost factors and the pace of import supply, has maintained overall price stability. In the domestic market, prices have been weak due to lower-than-expected demand during the "Golden September" holiday and relatively ample domestic supply. To facilitate transactions, traders have generally maintained a stable quote tone, leaving ample room for negotiation in actual transactions. Overall, the polypropylene market is expected to continue its "weak and stable consolidation" pattern in the short term.

Domestic PP Index: According to Tuduoduo data, the domestic PP spot index was 6955.00 on August 29, down 7 points, or 0.10%.

Guoneng auction statistics: Guoneng Coal Chemical's auction volume today was 1,334 tons, down 48.91% from yesterday; the transaction volume was 571 tons, down 55.84% from yesterday; the transaction rate was 42.8%, down 6.72% from yesterday.

Our platform connects hundreds of verified Chinese chemical suppliers with buyers worldwide, promoting transparent transactions, better business opportunities, and high-value partnerships. Whether you are looking for bulk commodities, specialty chemicals, or customized procurement services, TDD-Global is trustworthy to be your fist choice.