PP Price Fluctuation Today
Domestic petrochemical inventory: Sinopec and PetroChina's polyolefin inventory totaled 735,000 tons, a decrease of 35,000 tons from yesterday.
Futures Analysis: On December 2nd, the PP2601 contract price fluctuated upwards in the night session. The price initially dipped in the morning before entering a range-bound trading pattern. In the afternoon session, the price initially declined before rising again, with the fluctuation range narrowing. The 01 contract saw a decrease of 19,931 lots in open interest. Open price: 6397, highest price: 6426, lowest price: 6391, price difference: 35, open interest: 469,013, settlement price: 6407, previous settlement price: 6405, increase: 2, daily trading volume: 257,907 lots, idle funds: 2.104 billion, capital outflow: 84.98 million.
Mainstream market prices for PP (rough-grain) grade:
Domestic spot market analysis: Today, the domestic PP market showed an overall trend of slightly stronger consolidation. Prices in East China remained stable, while prices in Southwest China declined. Prices in North China, South China, and Northwest China rose, fluctuating by 20-50 yuan/ton. Domestic polypropylene mainstream prices ranged from 6150-6480 yuan/ton.
The current domestic PP market exhibits a narrow range of adjustments driven by supply and demand dynamics. Producers are generally maintaining stable ex-factory prices, accompanied by structural fluctuations.
Most companies are keeping their original quotations stable, while some are lowering ex-factory prices by 50-200 yuan/ton due to inventory and cost pressures. A few companies are slightly raising prices by 30-100 yuan/ton due to tight local supply or cost support. Overall, price fluctuations are within a reasonable range.
The core constraint on market operation lies in weak downstream demand. Orders for major application areas such as woven plastic products and pipes are insufficient, leading to low operating rates and cautious purchasing intentions. Many companies are adopting a "just-in-time" purchasing strategy to control inventory risk. Weak demand led to a subdued trading atmosphere in the market, with insufficient follow-up momentum in the spot market and a continued weak trading pattern.
To promote actual transactions, traders and manufacturers generally adopted promotional measures, offering discounts and flexibly adjusting price spreads to attract downstream purchases. Overall, the market is in a weak supply-demand balance due to ample supply capacity and insufficient demand. This fundamental situation determines that the current PP market price will mainly remain stable, unlikely to form a trend in the short term. Price movements will depend more on marginal changes in local supply and demand structures and short-term cost support.
Market Outlook: The current domestic PP market exhibits a pattern of "futures-driven, spot-market speculation." With mixed bullish and bearish factors, the futures market has strengthened first, but the spot market has not yet shown a synchronized response due to fundamental constraints. On the positive side, the continued US sanctions against oil-producing countries, coupled with geopolitical uncertainties, provide potential support for costs.
At the same time, the upward sentiment in the futures market has boosted market expectations, leading some traders to make small, tentative price increases. However, negative pressures have not eased substantially. OPEC+'s continued stance of increasing production means expectations of ample crude oil supply remain unchanged. The sluggish global economic recovery is dragging down end-user demand, with insufficient order support in major downstream sectors such as plastic weaving and pipe manufacturing.
Enterprises are still primarily focused on rigid demand, with weak willingness to actively replenish inventory, making it difficult to effectively absorb supply in the spot market. On the supply side, spot supply remains ample, and overall market supply pressure has not decreased, further limiting the upside potential of spot prices. In summary, while futures price increases have improved market sentiment in the short term, the core contradiction of ample supply and demand in the spot market remains unchanged.
Cost-side support is limited and lacks sustainability. It is expected that the polypropylene market will exhibit a narrow range of weak fluctuations in the short term. Although futures have risen, spot prices have struggled to follow suit. Spot prices may fluctuate slightly with futures, but the overall increase is limited. Actual transactions will still rely on flexible price concessions. Only a substantial improvement in downstream demand can drive an effective upward trend in the spot market.
Domestic PP Index: According to data from TuDuoDuo, the domestic PP spot index was 6286.00 on December 2nd, up 5, or 0.08%.
Guoneng Auction Statistics: Guoneng Coal Chemical's auction volume today was 1700 tons, an increase of 13.33% compared to yesterday; 1605 tons were traded, an increase of 11.23% compared to yesterday, with a transaction rate of 94.41%, a decrease of 1.79% compared to yesterday.
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