According to the data monitored by the business club, the PP market continued to decline this week, and the spot price of wire drawing brand fell. As of July 15, the mainstream offer price of T30S (wire drawing) from domestic manufacturers and traders was about 8316.67 yuan / ton, up or down -3.39% compared with the average price at the beginning of the month.

Cause analysis

Industrial chain: upstream, the domestic propylene (Shandong) market price rose this week. Recently, due to the good digestion of propylene inventory in the field, the supply has narrowed, and enterprises and merchants have increased their sales. However, the current downstream rigid demand is not strong, and it is more resistant to high price supply. In addition, the weakness of raw material end and the gradual cooling of trading have hindered the rise of propylene price. The market stabilized after rising this week, and it is expected that the propylene market may turn into a weak operation in the near future.

Propylene prices rose, but crude oil fell sharply in the early stage due to the impact of the Federal Reserve’s interest rate hike, and PP cost side support was weak this week. In terms of industry load, the operating rate of PP polymerization enterprises was adjusted this week, and the real-time loss capacity was expanded, but the current supply pressure is still large. The inventory digestion of enterprises and midstream is not as good as last week, and the inventory position continues to rise, and is at the high position over the years. In terms of demand, the downstream factories of wire drawing materials purchase and follow-up are biased towards just need to maintain production. In terms of operation, they buy on bargain hunting and have a strong resistance to high price sources. Traders’ shipments are in line with the market, and the operating rate of terminal enterprises has decreased by a narrow margin. It is expected that the spot market of PP wire drawing materials may continue to be weak and adjusted.

In terms of fiber materials, according to the data monitored by the business society, as of July 15, the spot price of domestic fiber PP gradually fell. The mainstream offer price of Z30S (fiber) from domestic producers and traders was about 8216.67 yuan / ton, up or down -4.27% compared with the average price at the beginning of the month, with a year-on-year decrease of -4.09%. This week, the load of downstream non-woven enterprises, the main force of PP fiber, continued to drop, and the demand and operation of end enterprises continued on the whole. Large enterprises just needed to take goods to maintain production, while the load of small and medium-sized enterprises decreased or even stopped production. The consumption of products maintains the off-season mode, and the replenishment operation tends to maintain production. The demand for medical fiber products has also cooled, and the rigid support is weakened. The supply side is abundant, and the market momentum is reduced. It is expected that the fiber material may remain weak in the off-season market in the short term.

In terms of melt blown materials, the melt blown PP market fell this week. As of July 15, the average quotation of domestic melt blown material sample enterprises monitored by the business agency was about 9566.67 yuan / ton, up or down -0.35% compared with the average price at the beginning of the month. In terms of international health events, the current situation in various countries is still not optimistic. Recently, the number of confirmed cases in China has increased, and the epidemic prevention pressure continues to fluctuate. However, medical meltblown cloth materials have entered the off-season of consumption, and the demand has decreased, which does not significantly support the spot price. The supply of melt blown materials in the market is sufficient, and the saturation of domestic melt blown materials and cloth enterprises is high. Together with the shipping resistance, it is expected that the recent market of melt blown PP will maintain a weak operation along with other PP varieties.

Aftermarket forecast

PP analysts of business news agency believe that the domestic polypropylene market fell this week, the rise of raw material propylene market was blocked, the decline of international crude oil intensified, and the cost side support of PP weakened. The demand of terminal enterprises expands slowly, the mentality of merchants is general, and the offer is subject to the market. It is expected that the PP market may continue to be weak in the near future.