In early June, the domestic PP market remained stable with some gains. The prices of various brand products remain firm. As of June 10th, the benchmark price for PP drawing offered by Shengyi Society was 9656.67 yuan/ton, an increase of 0.87% compared to the beginning of the month.
| Gamma-PGA (gamma polyglutamic acid) |
price trend
In terms of raw materials:
In early June, high-level peace talks between the United States and Iran in the Middle East were deadlocked, with divergent attitudes. The fluctuation of premium within the range has put pressure on the demand side, causing the market to rise first and then fall, which has limited support for the far end cost value of PP. The demand for propylene in the market remains stable, but last month, the restart of enterprise facilities and increased supply suppressed spot prices, resulting in a continuation of the recent correction trend. Overall, the PP raw material market is fluctuating, providing moderate support for PP costs.
Supply side:
In early June, some domestic PP companies still had some maintenance plans implemented, and the overall operating rate decreased at a low level. As of the time of writing, the overall load of the domestic industry is about 65%, and the weekly output is less than 680000 tons. The current inventory position is around 600000 tons, and the overall supply performance remains tight. Overall, the supply side has sufficient support for spot prices.
In terms of demand:
The current consumption of polypropylene is gradually entering the off-season level, and the downstream market of the industry remains resistant to high prices, resulting in a cautious overall trading atmosphere. The buyer camp picks up goods on demand, and the warehouse building operation is average, often with scattered small orders that can be picked up as needed. Meanwhile, due to the high cost pressure, the improvement in operating rates of small and micro end enterprises is limited, while large and medium-sized enterprises continue to stabilize and acquire goods. The demand side is generally in a wait-and-see situation, with average support for PP.
Future forecast
In early June, the domestic PP market prices remained stable with a slight increase. Fundamentally speaking, the industry load remained low in June, with limited changes in port imports and limited availability of spot resources in the market. The cost side is fluctuating, while the demand side is entering the off-season market, making it difficult to increase volume in the short term. Business Society PP analysts believe that the current PP market is weak in both supply and demand, and the upward momentum in the future is hindered. The magnitude of this increase may not be significant.
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