Polypropylene Weekly Report: Spot market fluctuated and consolidated during the week, and the supply side was slightly under pressure(December 26, 2024)
Chapter 1 Review of the polypropylene market this week
1. Analysis of the trend of the domestic polypropylene market
This week, the domestic polypropylene market as a whole showed a trend of fluctuating and consolidating. Compared with the same period last week, the prices of various regional markets fell slightly across the board, with an adjustment range of 20-50 yuan/ton. As of Thursday this week, the domestic drawing price ranged from 7345 to 7790 yuan/ton.
The main factors affecting price fluctuations during the week are: 1. On the cost side, international oil prices showed a trend of falling first and then rising during the week. In the early part of the week, international oil prices fell due to concerns about crude oil demand and the US commitment to lift energy restrictions. In the late part of the week, oil prices rebounded due to factors such as the unexpected decline in US API crude oil inventories, and the cost support for the PP market was strengthened. 2. On the supply side, Donghua Energy's Maoming PP unit with a production capacity of about 400,000 tons resumed operation during the week. In addition, Sino-Korea Petrochemical postponed the planned start-up time, and the impact of the PP unit shutdown remained at about 15%. In addition, the fifth line of Yulong Petrochemical and the first line of Inner Mongolia Baofeng were put into production, and the supply side was slightly under pressure. 3. On the demand side, terminal demand has not improved, and the consumption of raw material PP is limited. Most downstream industries have entered the off-season for orders. In addition, the risk aversion of enterprises at the end of the year has increased, which has limited the purchase of raw material PP to a certain extent. The overall purchase intention is mediocre.
2. Analysis of the trend of the polypropylene US dollar market
Chapter 2 Polypropylene trend forecast
In terms of raw materials, Sevens Report Research said that geopolitical concerns are the main reason why WTI oil prices can be maintained at US$65 per barrel in the second half of this year. The light trading during holidays may cause crude oil prices to rebound. On the supply side, with the cooperation of futures at the end of the month, the inventory of polyolefins from the two oils accelerated, and the current inventory level is at a low level this year. In addition, the Ningbo Fude PP unit is scheduled to be shut down for maintenance next week, but the three units of Sino-Korean Petrochemical that were shut down earlier are scheduled to resume work, and the supply of goods may continue to increase slightly next week. On the demand side, the downstream industries at the end of the year mainly maintain year-end orders, and some factories replenish their positions in small quantities to maintain short-term production. In addition, due to the return of funds at the end of the year and the impact of risk aversion, terminal demand may continue to be dominated by rigid demand. Under the combined influence, it is expected that the polypropylene market may fluctuate and weaken next week.
