Polypropylene Market Weak Consolidation
Domestic petrochemical inventories: Polyolefin inventories of both crude and crude oil products reached 630,000 tons, down 5,000 tons from yesterday.
Futures Analysis: The PP2601 contract price fluctuated narrowly in the evening session on September 19th, with the center of gravity shifting slightly downward. Prices consolidated in the morning session, and continued their volatile downward trend in the afternoon session. Opening price: 6930, high: 6937, low: 6904, with a spread of 33. Open interest: 609,908, settlement price: 6917, yesterday's settlement price: 6955, a decrease of 38. Daily trading volume: 609,908 lots, deposited funds: 2.952 billion yuan, inflow: 165 million yuan.
Mainstream Market Quotes for Wire Drawing:
Domestic Spot Market Analysis: The overall domestic PP market showed a weak and stable trend today. Prices declined only in South China, while prices in North China, East China, Southwest China, and Northwest China all remained stable. In terms of price: The mainstream domestic polypropylene price ranges from 6,710 to 7,060 yuan/ton.
The overall PP market is currently operating with a "stable but weak" outlook. On the supply side, most PP companies maintain stable ex-factory prices, with only a few reducing prices by 20-100 yuan/ton based on their own circumstances. This lack of effective cost support makes it difficult to effectively support the market. Demand is weak, with downstream consumption recovering slowly.
End-users are cautious in purchasing, with little actual purchasing intention, resulting in a subdued market environment. Against this backdrop, spot market prices have declined slightly in some regions. To facilitate transactions, traders are offering some margin in spot quotes, limiting the overall market's boost.
Market Forecast: Currently, the international crude oil market is facing a mix of bullish and bearish factors. The continued US sanctions on oil-producing countries, coupled with geopolitical uncertainty, are providing some support to the market.
However, OPEC+'s continued production increases and the weakening global economy are weighing on the market, making the cost support for the polypropylene market uncertain. On the supply side, the 200,000-ton PP production plant at Sanyuan in Shaoxing is scheduled to restart today, leading to a marginal increase in market supply.
Coupled with the current high level of industry inventory and the slowing pace of destocking, market concerns are growing about further oversupply pressure. While demand has entered its traditional peak season, the seasonal effect has significantly fallen short of expectations, with downstream companies struggling to take on new orders, and overall demand is weak.
However, the approaching Mid-Autumn Festival and National Day are providing temporary positive momentum. In the end-use market, orders for holiday gift packaging, such as mooncakes, have increased significantly, and this unleashing of rigid demand is providing some support for PP packaging products. In the short term, the polypropylene market is expected to remain volatile and weak.
Domestic PP Index: According to Tuduoduo data, the domestic PP spot index was 6839.00 on September 19, down 5 points, or 0.07%.
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