According to the Commodity Market Analysis System of Business Society, the domestic PP market remained weak in October, with prices of various grades mostly declining. As of October 16, the quoted price of PP filament benchmark was 6,790 yuan/ton, showing a 1.88% decrease compared to the early October price level.
Price trends
| Gamma-PGA (gamma polyglutamic acid) |
In terms of raw materials:
Since October, the geopolitical tensions in Eastern Europe have persisted, while the Federal Reserve’s rate cuts have boosted the crude oil market. On the other hand, OPEC+ has initiated a new round of production increases totaling 1.65 million barrels per day, yet concerns over long-term supply glut remain. The easing of tensions in the Middle East, coupled with weakening U.S. demand and trade barriers, has dragged down global economic growth and demand expectations, leading to a sharp decline in international oil prices. In the case of propylene, recent demand absorption has been insufficient, resulting in a rapid decline. Fortunately, inventories remain relatively manageable, and prices have stabilized with a slight rebound near mid-month. After a rebound in propane prices post the holiday season, supply tightening and weak overseas trading dragged prices lower by mid-month. Overall, the price movements of various PP raw materials have been mixed, providing only modest cost support.
Supply side:
In the first half of October, the operating rate of domestic PP enterprises fluctuated with limited overall changes. As of the time of writing, the industry’s average operating rate stood at 77%, comparable to the level at the end of September. The weekly average total output exceeded 770,000 tons. The future market shows a clear trend of ample supply, severely limiting the support from the supply side. Currently, the market maintains sufficient supply, with inventory levels accumulating to over 820,000 tons. Overall, the PP supply side provides weak support for spot prices.
Demand side:
In the first half of October, the polypropylene market remained in the traditional peak season, with some degree of improvement in demand from sectors such as plastic weaving and agriculture. Although new orders in the packaging film sector also increased, the upward momentum in market activity was limited. Moreover, the positive impact of improved trading sentiment was offset by numerous negative factors. The announcement of the Federal Reserve’s interest rate cut and the U.S. tariff disputes dampened market expectations. Additionally, low operational capacity among downstream enterprises and slow inventory digestion during the National Day holiday period hindered the anticipated surge in PP consumption during the peak season, while also failing to provide robust support for demand.
Market Outlook
In the first half of October, domestic PP market prices continued to decline weakly. From a fundamental perspective, upstream raw material prices showed mixed performance, providing limited overall support for PP. Industry production remained at high levels with narrow adjustments, and future supply is expected to be ample. On the consumption side, improvements were limited, lacking positive guidance for market trends. Currently, the market does not exhibit clear signs of peak season, and PP’s upward momentum faces significant resistance. It is anticipated that weak adjustment trends may persist.
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