China's PP Market Weak Trend Oct 11th
Domestic petrochemical inventories: Polyolefin inventories from both oil and petroleum products reached 820,000 tons, down 25,000 tons from yesterday.
Mainstream Wire Drawing Market Quotes:
Domestic Spot Market Analysis: The domestic PP market continued its weak trend today. Market prices in South China and Southwest China remained stable, while prices in North China, East China, and Northwest China all declined compared to yesterday, with price reductions ranging from 20 to 30 yuan/ton.
Regarding prices: The mainstream domestic polypropylene price ranged from 6,590 to 6,770 yuan/ton. The current PP market performance is characterized by "stable and declining upstream prices, profit concessions in the midstream to boost sales, and strong demand in the downstream."
The overall market is under pressure due to the combined effects of various links. Specifically, PP manufacturers' ex-factory prices remained largely stable, with only a few adjusting prices by 10-200 yuan/ton based on their own circumstances, providing relatively stable cost support for the market. Following the National Day holiday, traders generally adopted a profit-sharing strategy to stimulate transactions and alleviate inventory pressures.
However, downstream companies, influenced by demand expectations, strictly limited their inventory replenishment to essential needs, and their enthusiasm for purchasing remained low. Under this supply-demand dynamic, market prices lacked upward momentum and gradually came under downward pressure, further reducing on-site trading activity and maintaining a subdued overall atmosphere.
Market Forecast: The current PP market is characterized by a mix of bullish and bearish factors, with bearish forces dominating overall. This, coupled with weak supply and demand conditions and bearish market sentiment, is suppressing market performance.
From the perspective of the crude oil market, the only positive factor is the continuation of US sanctions on oil-producing countries, while geopolitical factors have significantly weakened. Previous geopolitical uncertainty has dissipated due to the continued easing of the Israeli-Palestinian situation, and OPEC+ has maintained its stance on increasing production, further weakening support for PP costs.
Furthermore, expectations of US tariff increases on some countries, coupled with a weak global economy, have combined to weigh on downstream PP demand, creating a significant bearish outlook.
From an industry perspective, while the supply side benefits from the expected shutdown of Yuntianhua's PP plant today, significant post-holiday inventory accumulation in the market has offset the impact of some supply reductions.
Demand remains weak, with downstream companies showing limited buying enthusiasm and generally adopting a wait-and-see approach, with little interest in restocking, further exacerbating the supply-demand imbalance. Overall, the polypropylene market is expected to remain weak in the short term and may continue its narrow downward trend.
Domestic PP Index: According to Tuduoduo data, the domestic PP spot index was 6689.00 on October 11, down 8 points, or 0.12%.
Guoneng auction statistics: Guoneng Coal Chemical's auction volume today was 1,937 tons, down 22.59% from yesterday; the transaction volume was 591 tons, down 65.01% from yesterday; the transaction rate was 30.51%, down 36.99% from yesterday.
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