PP Market Nov 19 Analysis
Domestic petrochemical inventory: Sinopec and PetroChina's polyolefin inventory totaled 700,000 tons, a decrease of 10,000 tons from yesterday.
Futures Analysis: On November 19th, the PP2601 contract price fluctuated upwards in the night session, showing an overall strong trend. After reaching a relatively high intraday level, it began to fall back. The morning session continued the oscillating pattern of the night session, briefly rising before falling back, but quickly recovering its losses and returning to high levels.
In the afternoon session, the price broke through the previous trading range, rising to the intraday high before fluctuating downwards. The 01 contract saw a decrease of 18,039 lots in open interest. Opening price: 6403, highest price: 6444, lowest price: 6394, price difference: 50, open interest: 620,333, settlement price: 6422, previous settlement price: 6427, decrease: 5, daily trading volume: 312,085 lots, idle funds: 2.794 billion, capital outflow: 62.48 million.
Mainstream Price Quotes for PP Fiber Grade:
Domestic Spot Market Analysis: Today, the domestic PP market showed a generally weak trend. Only the lowest market price in East China saw a slight increase, while market prices in North China, South China, Southwest China, and Northwest China all fell compared to yesterday.
The overall price fluctuation range was 10-50 yuan/ton. In terms of price, the mainstream domestic polypropylene price ranged from 6200-6560 yuan/ton. Currently, the domestic PP market presents a weak supply-demand balance. Producers' ex-factory prices remained generally stable, with only a few grades experiencing slight reductions of 10-30 yuan/ton due to inventory digestion demand.
The mainstream price system did not fluctuate significantly. From the demand side, downstream industry demand was insufficient, and end-user companies showed weak purchasing intentions. Replenishment activities were only focused on rigid production needs, with no proactive inventory increases.
Affected by the lack of strong support on both the supply and demand sides, the overall trading atmosphere was weak. Traders and downstream companies were generally cautious, and the pace of transactions slowed down due to price negotiation, resulting in a poor market trading atmosphere.
Against this backdrop, spot market prices are consolidating weakly, with a moderate battle between bulls and bears and no clear directional breakout. The overall market remains stable to slightly weak.
Market Outlook: The current PP market is caught in a complex web of bullish and bearish factors. Positive factors mainly rely on the continuation of US sanctions against oil-producing countries, coupled with geopolitical uncertainties, providing some support to the market.
However, negative factors are more prominent. OPEC+'s continued stance on increasing production, coupled with weak global economic recovery leading to overall poor end-user demand, is significantly suppressing the market. Simultaneously, the industry is in its traditional off-season, lacking effective support on the demand side. Downstream enterprises are generally not very active in purchasing, with most only maintaining rigid procurement volumes.
Furthermore, the limited operation of some downstream factories due to environmental protection and energy consumption factors during winter further weakens the supportive effect of demand. On the supply side, domestic PP plants are operating smoothly overall, with no large-scale maintenance or production reduction plans.
The spot market supply remains ample, while weak demand has led to a continued slowdown in the industry's destocking pace, gradually accumulating inventory pressure. In summary, the tug-of-war between bulls and bears will continue in the polypropylene market in the short term.
Positive factors are unlikely to generate a significant breakthrough, while weak demand and inventory pressure will dominate market trends. The market is expected to maintain a weak consolidation trend with no clear upward momentum. Continued attention needs to be paid to changes in the geopolitical situation and the recovery of downstream demand.
Domestic PP Index: According to data from TuDuoDuo, the domestic PP spot index was 6388.00 on November 19th, down 21 points, a decrease of 0.33%.
Guoneng Auction Statistics: Guoneng Coal Chemical's auction volume today was 2336 tons, an increase of 11.24% compared to yesterday; the transaction volume was 2136 tons, an increase of 15.09% compared to yesterday, with a transaction rate of 91.44%, an increase of 3.06% compared to yesterday.
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