SunSirs: Propylene Oxide Hit a New Low This Week (August 26-30)

Price trend

This week, the price of propylene oxide hit a new low. With the recovery of enterprise equipment, the operating rate of some enterprises increased, and the supply had significantly increased. However, due to the impact of low-priced sources, the price center had shifted downwards. As the end of the month approached, there had been a slight rebound in buying activity, but market prices had not shown significant improvement, and prices had hit a new low at the end of the month. According to the Commodity Market Analysis System of SunSirs, as of August 30th, the benchmark price of SunSirs's propylene oxide was 8,615.00 RMB/ton, a decrease of 4.01% compared to the beginning of this month (8,975.00 RMB/ton).

Analysis review

Price influencing factors:

Raw material side: Recently, the price of propylene in the market had slightly increased, and the price of liquid chlorine had also slightly boosted. The supply volume had increased, but the increase in supply had limited its price rise. According to the market analysis system of SunSirs, as of August 30th, the benchmark price of propylene in SunSirs was 6,968.25 RMB/ton, a decrease of 1.62% compared to the beginning of this month (7,083.25 RMB/ton). The fluctuation of raw materials had little impact on the propylene oxide market, and the overall propylene oxide market was still in a downward trend. The main focus should still be on the market supply and demand relationship.

Downstream demand side: Downstream mainly focused on essential procurement, with a cold trading atmosphere and insufficient order volume. Downstream wait-and-see sentiment was strong, market atmosphere was weak, and the market was declining. More attention should be paid to whether the downstream supporting equipment of Lihuayi Weiyuan propylene oxide and the capacity expansion of Longhua polyether can be smoothly put into operation in September.

Market outlook

The propylene oxide analyst from SunSirs believes that the follow-up of new orders for propylene oxide downstream was average, with a focus on essential needs for transactions. Although the supply increased, the impact of low-priced sources had shifted the price center downward. It is expected that the market price of propylene oxide will fluctuate in the short term, and more attention still needs to be paid to market supply and demand as well as changes in raw materials.

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