SunSirs: Balancing Long and Short Positions, China PP Price is Sorting Out

https://www.chemnet.com   Oct 30,2024 SunSirs

According to the Commodity Market Analysis System of SunSirs, the PP market situation remained stagnant and consolidated at the end of October, with prices of various brand products fluctuating. As of October 29th, the mainstream offer price for wire drawing by domestic manufacturers and traders is around 7,592.86 RMB/ton, and the price level has basically returned to the beginning of the month.

In terms of raw materials: In terms of international crude oil, the current geopolitical situation is showing a tense trend, while some consumption has slightly improved, to some extent boosting the market. But on October 28th, international crude oil futures fell sharply, so the market turned weak and came under pressure. At the same time, the contraction of propylene supply is favorable for the market, but with the gradual caution in chasing high consumption, there will be a slowdown in the increase at the end of the month accompanied by a narrow correction. The domestic supply of methanol has recovered in the early stage, but there is a lack of strong support on the supply and demand side, and prices are running at a stalemate. Previously, the price of propane was relatively stable due to internal low and external high pulling each other. Overall, at the end of October, PP raw materials experienced more declines and less increases, with average support on the cost side.

In terms of supply: At the end of October, the load level of domestic PP enterprises was reduced due to the implementation of some enterprise equipment maintenance plans. In the latter half of the year, companies such as Jinergy Chemical and Zhongjing Petrochemical will have their equipment undergoing maintenance. The maintenance production lines will be concentrated in the southern region of China, and the overall industry load will be around 76.5%. At present, the inventory of two barrels of PP oil in China is stable at around 765000 tons, which has decreased compared to mid month. But the supply is still at a sufficient level. Overall, the supply side provides sufficient support for PP spot prices.

In terms of demand: At the end of October, there was a certain increase in demand for PP, and the load on end enterprises has risen. The consumption of woven bags such as fertilizers, cement, and rice continues to increase, and the warehousing of plastic weaving enterprises has generally decreased, with an increase in willingness to build warehouses. On the other hand, due to the cooling weather, downstream consumption of PP non-woven fabrics has also rebounded, which has to some extent boosted the demand for fiber PP materials. The demand side has seen a narrow increase in support for PP spot goods.

At the end of October, the price of PP in the domestic Chinese market remained stagnant and consolidated. Fundamentally speaking, the comprehensive support of upstream raw materials for PP is average, while the demand side is expected to heat up in the short term due to the increase in e-commerce consumption. However, the previous increase has to some extent suppressed domestic trading, coupled with the weakened impact of loose funding policies and the negative impact of industry expansion in the fourth quarter. In the short term, it is expected that PP prices will continue to operate in a consolidation manner.

If you have any enquiries or purchasing needs, please feel free to contact SunSirs with support@sunsirs.com.

 Print  |    add to Favorites  |    Close