According to the commodity market analysis system of Business Society, the PP market has continued to decline recently, with prices of various wire drawing brands decreasing. As of January 12th, the mainstream quoted price for T30S (wire drawing) by domestic producers and traders is around 7578.57 yuan/ton, with a decrease of -0.93% compared to the average price level at the beginning of the month.

Cause analysis

Industry chain: In terms of PP raw materials, news of international crude oil OPEC production reduction and other factors have supported the market, coupled with the recent sustained tension in shipping, prices have been supported and rising. The inventory of propylene remains low, with prices strengthening narrowly. The demand for propane in PDH has weakened and prices have loosened. The methanol market is relatively stable. Upstream raw materials fluctuate, and overall support for PP is average.

The raw material flow in all directions is average, and the cost side’s support for PP is temporarily stable. In terms of industry load, due to the return of production and maintenance of some production lines, the average load of the polypropylene industry this week was above 77%, which is higher than the previous period. The supply of goods remains abundant, with a narrow decline in inventory, and no improvement in on-site supply pressure. In terms of demand, the holiday situation of terminal enterprises has increased, and the comprehensive operating rate of downstream PP enterprises such as plastic weaving, film materials, and injection molding is less than 53%. Terminal enterprises maintain cautious operations in purchasing goods, with poor trading activity on the exchange and an overall weak market for wire drawing materials.

In terms of fiber materials, according to the commodity market analysis system of Business Society, as of January 12th, the spot price of domestic fiber PP has also increased. The mainstream quoted price for domestic producers and traders of Z30S (fiber) is around 7500 yuan/ton, with an increase or decrease of -2.28% compared to the average price at the beginning of the month, and a decrease of 4.46% compared to the same period last year. Recently, the main downstream non-woven fabric enterprises of PP fiber materials have seen significant and stable loads, with operating rates at around 39%. The digestion speed of end products is sideways, and the demand for fiber materials in the market is average, which lacks support for the price of non-woven fabrics. It is expected that downstream procurement efforts will not improve, and fibers may continue to be weakly sorted.

In terms of melt blown materials, the melt blown PP market has seen a narrow increase this week. As of January 12th, the average quotation of domestic melt blown material sample enterprises monitored by the Commodity Market Analysis System of Shengyishe is about 7987.50 yuan/ton. Compared with the average price level at the beginning of the month, the price has increased or decreased by 1.08%, with a year-on-year decrease of 23.45%. At present, the demand for facial protection in China is generally high, and the impact of winter climate on the consumption of medical melt blown fabric materials is not significant. There is also no significant boost in domestic and foreign demand. In addition, there are not many new orders from downstream factories, resulting in a decrease in overall operating rates. It is expected that the melt blown material market will continue to be weak and stable.

Future Market Forecast

PP analysts from Business Society believe that the polypropylene market continues to decline narrowly this week. The trend of upstream raw materials is average, and the support for the market from the cost side is average. The production of terminal enterprises is relatively low, and the purchasing operation maintains weak and rigid demand. The PP plant load is once again rising, and it is feared that the supply pressure in the future will not improve. Coupled with factors of insufficient market buying, it is expected that the PP market may continue to operate weakly in the short term.