According to the Commodity Market Analysis System of Shengyi Society, the domestic PP market has been fluctuating recently, with prices of some brand products fluctuating. As of July 23rd, the mainstream offer price for wire drawing by domestic producers and traders is around 7303.33 yuan/ton, a decrease of -2.06% compared to the price level at the beginning of July.
| Gamma-PGA (gamma polyglutamic acid) |
price trend
In terms of raw materials:
Since the beginning of July, the easing of geopolitical tensions in the Middle East and Eastern Europe, as well as the announcement of OPEC+production plans, have put some pressure on international oil prices. At present, the market’s concerns about the risk of crude oil supply interruption have eased, and price fluctuations are mainly being consolidated. At the same time, the consumption of propane is sluggish, and it has followed the previous decline of crude oil. The current price position is not high, and the cost support for PDH manufacturing enterprises has fallen. In the early stage, propylene production and resumption of work were common, and the market was under pressure to decline. Recently, it has rebounded at a low level, but the increase is limited. Overall, the prices of PP raw materials at the end of July showed weak support for costs.
Supply side:
In July, there was a mutual occurrence of maintenance and resumption of work in domestic PP enterprises, as well as the release of production capacity. Overall, the industry’s overall load level has slightly decreased by 1% to 76% recently, with an average weekly total output of nearly 780000 tons. The supply of goods remains abundant, with inventory levels hovering around 780000 tons and average digestion. Overall, the improvement in support for spot prices from the PP supply side is very limited.
In terms of demand:
July is the traditional off-season for polypropylene consumption, and the demand for PP continues to be weak, resulting in a quiet trading atmosphere on the market. Merchants have hardly seen any advance stocking operations, and the on-site situation remains in a state of urgent need, with a focus on on-demand use. In terms of plastic weaving, the consumption level of terminal enterprises is already at the off-season level, and downstream PP enterprises in China are struggling to start production. Materials used in construction, agriculture and other fields are also at a low level and flat. On site new orders tend to be scattered small orders and contract deliveries, with flat liquidity of supply and slow release of PP demand. In the context of weak export and domestic demand, the demand side of PP has not provided strong support for spot prices.
Future forecast
Recently, the domestic PP market prices have fluctuated and consolidated. Fundamentally speaking, the overall strength of upstream raw materials is weak, and their overall support for PP is poor. The industry load is stable with small fluctuations, and there is an expectation of abundant supply in the future. Consumption is at a low season level. The contradiction between supply and demand and the decrease in cost value are combined, and the mentality of operators is bearish. It is expected that the PP market will continue to be stagnant in the short term.
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