September 26 Domestic PP Market Update

Domestic petrochemical inventories: Polyolefin inventories of both crude and crude oil products reached 585,000 tons, down 30,000 tons from yesterday.

Futures Analysis: The PP2601 contract price fluctuated upward in the evening session on September 26th. The upward trend continued in the morning session, with prices initially surging in the afternoon session before falling slightly. Opening price: 6890, high: 6930, low: 6868, with a spread of 62.

Opening volume: 609,770, settlement price: 6900, compared to yesterday's settlement price: 6893, a 7% increase. Daily trading volume: 229,349 lots, deposited funds: 2.942 billion yuan, and capital outflow: 90.34 million yuan.

Mainstream Market Quotes for Wire Drawing:

Domestic Spot Market Analysis: The domestic PP market remained generally stable today. Market prices in North China, East China, South China, Southwest China, and Northwest China remained unchanged from yesterday. In terms of price: The mainstream domestic polypropylene price ranges from 6,670 to 6,870 yuan/ton.

The current PP market is characterized by a supply-demand dynamic and price volatility. Ex-factory prices remain generally stable, with only some grades experiencing price reductions of 30-150 yuan/ton, representing limited price adjustments. 

Downstream demand is driven by rigid demand, with cautious restocking and no large-scale stockpiling. This has led to slow follow-up transactions in the spot market. With no clear drivers on either the supply or demand side, spot prices have remained range-bound. In the futures market, market sentiment remains cautious, with insufficient upward momentum and only tentative upward movement. Overall, the current market trading atmosphere is subdued, maintaining an overall consolidation pattern.

Market Forecast: The polypropylene market currently faces a mix of bullish and bearish factors. Positive factors primarily stem from the continued US sanctions on oil-producing countries and geopolitical uncertainty, providing some support. Negative factors are being suppressed by OPEC+'s continued production increases and the weak global economic performance.

Regarding supply and inventory, Levima New Materials' 200,000-ton PP unit is expected to resume production today. Meanwhile, inventories of polyolefins from oil and gas companies have continued to decline, reaching 95,000 tons this week, easing inventory pressure. On the demand side, downstream restocking is limited, and the spot market is sluggish.

While downstream demand remains strong, restocking enthusiasm is insufficient, making it difficult to effectively drive prices higher. Factories are only engaged in moderate pre-holiday stockpiling, and the overall market strategy is cautiously cutting corners and reducing inventory. Overall, the PP market is likely to remain range-bound in the short term.

Domestic PP Index: According to Tuduoduo data, the domestic PP spot index was 6781.00 on September 26, down 0.00%.

GuoNeng Auction Statistics: GuoNeng Coal Chemical's auction volume today was 1,242 tons, a decrease of 15.75% from yesterday; 1,138 tons were sold, a decrease of 11.38% from yesterday, with a sell-through rate of 91.63%, an increase of 4.52% from yesterday.

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