According to the commodity market analysis system of SunSirs, the PP market fluctuated and consolidated in early March, and the price adjustment range of most grades of products was narrow. As of March 11, the mainstream quoted price of wire drawing by domestic manufacturers and traders was around 7,525 RMB/ton, with a rise and fall of +0.11% compared with the price level in early March.

Price trend

In terms of upstream crude oil, as the geopolitical situation between Russia and Ukraine eased in early March, the market's concerns about the shrinking demand for crude oil increased. Combined with the high level of US crude oil inventories in the previous period, the crude oil market was suppressed in many aspects, and the price position loosened. In terms of propylene, the price was at a staged low in early March, and the downstream entered the market to replenish stocks and increase the volume, and the price gradually recovered within ten days. In terms of propane, the overall domestic inventory increased, and there was a lack of active guidance in the market, and the price mainly followed the decline of crude oil. In general, the PP raw material market in early March rose and fell, and the overall support for the cost side of PP was general.

Supply:

In early March, the load of domestic PP enterprises increased slightly, and the market supply was still sufficient. Overall, the overall load level of the industry rebounded to more than 81% compared with 79% at the end of February, and the domestic average weekly output rose to 770,000 tons. The production capacity is still blank in the ten-day period, and the maintenance and resumption of PP units will occur in the future. From the results, it is expected that the shipment volume will change limitedly, and the supply side will still be relatively weak in supporting the spot price of PP.

Demand:

In early March, the demand side of PP improved limitedly, and the trading on the market remained at the rigid demand level. For terminal enterprises, the consumption level of woven bags such as fertilizers, cement, and rice has rebounded. As the temperature warms up, the demand for PP in construction, agriculture and other fields has also risen. However, the new orders in the current market are generally small, and there is no significant increase in volume. Exports are hindered by tariffs. Overall, the demand side is insufficient.

Market forecast

In early March, the domestic PP market price was mainly consolidated. From a fundamental perspective, upstream raw materials have not provided good support for PP, the industry supply has risen slightly from a high level, consumption has slowly recovered, and the market has returned to a supply-demand game. In the short term, PP prices may still be under pressure.

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