Sept 10 China PP Market Update
Domestic petrochemical inventories: Polyolefin inventories of both crude and crude oil products reached 675,000 tons, down 15,000 tons from yesterday.
Futures Analysis: The PP2601 contract price fluctuated upward in the night session on September 10th, with a small increase. The price continued its upward trend in the morning session, but then rebounded in the afternoon session, reversing some of the morning gains.
Opening price: 6943, high: 6967, low: 6936, with a spread of 31. Opening volume: 614,906, settlement price: 6951, yesterday's settlement price: 6945, an increase of 6. Daily trading volume: 172,820 lots, deposited funds: 2.991 billion yuan, and inflows: 20.16 million yuan.
Mainstream market quotes for wire drawing:
Domestic spot market analysis: Today, the domestic PP market showed a mixed trend of gains and losses. Market prices in East China saw a slight increase, while those in South and Southwest China saw declines, fluctuating between 30 and 50 yuan/ton.
Prices in North and Northwest China remained stable compared to yesterday. Regarding prices, the mainstream domestic polypropylene price ranged from 6,720 to 7,090 yuan/ton. Ex-factory prices at major manufacturers remained stable, with some companies lowering prices by 50 to 100 yuan/ton to boost shipments.
Meanwhile, a few companies raised their offers for specific grades, resulting in a divergent price performance. Traders showed little willingness to ship, lacking the motivation to push for price increases or proactively promote sales, and generally operating in line with market trends. Furthermore, weak demand support, sluggish purchasing interest from downstream companies, and insufficient actual demand follow-up, lacked effective support for market prices.
Affected by weak demand, PP manufacturers are generally facing the pressure of high inventories, with some opting to accelerate destocking by offering discounts. Against this backdrop, the overall market trading atmosphere has become cautious, with actual transaction activity low and a strong wait-and-see attitude prevailing.
Market Forecast: It's the traditional "Golden September" period, and the market is experiencing a mix of bullish and bearish factors. On the positive side, the continued US sanctions on oil-producing countries and ongoing geopolitical uncertainty are providing supply-side support.
On the negative side, OPEC+'s continued production increases and the weak global economic performance are directly constraining downstream demand, resulting in limited support. Currently, no new units are shut down for maintenance, and the resumption date for already shut down units remains uncertain. Under these circumstances, traders are offering discounts to facilitate transactions, leaving room for negotiation on spot prices.
Overall, weak demand remains the core driver of the market, and coupled with the expectation of easing supply due to OPEC+'s production increases, it is difficult for the market to generate effective upward momentum. The polypropylene market is expected to experience a volatile and weak trend in the short term, with market negotiations likely to continue to dominate.
Domestic PP Index: According to Tuduoduo data, the domestic PP spot index was 6885.00 on September 10, down 11 points, or 0.16%.
Guoneng auction statistics: Guoneng Coal Chemical's auction volume today was 1,730 tons, up 6.4% from yesterday; the transaction volume was 780 tons, down 10.96% from yesterday; the transaction rate was 45.09%, down 8.79% from yesterday.
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