PP prices fell in December (12.1-12.31)

1、 Price trend

 

According to the data monitored by the business agency, the domestic PP market in December was in a weak downward trend. As of December 31, some spot prices were lower than the beginning of the month. The main offer price of T30S from domestic producers and traders is about 7833.33 yuan / ton, down 6.56% from the beginning of the week.

 

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2、 Cause analysis

 

Upstream: according to the data in the business club’s bulk list, the price of propylene in the upstream of PP began to decline at the beginning of December under the influence of the international crude oil “Black Friday” market, and the price has declined all the way, about 400 yuan / ton. After that, the price has remained stable and fluctuated in a narrow range. At the end of the month, the price of the enterprise began to decline again from December 25, about 200 yuan / ton in two days, and the price began to rise at the end of the month. On the upstream side, OPEC’s production reduction policy was extended, and the international crude oil market was consolidated at a high level, but the increase was not large, which had a certain effect on propylene. In the downstream, the start-up of downstream manufacturers gradually recovered, the delivery situation improved, the profit margin was fair, and it also had a certain positive impact on propylene. In general, propylene market fell twice in December, with a total decline of nearly 10%. At the end of the month, it recovered slightly from the annual low price. The downstream operating rate is good and the profit margin is fair.

 

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Products: the cost support is weak, some domestic petrochemical prices are down, the high spot price transaction resistance is obvious, the purchase intention of merchants is low, the continuation just needs to make up the position, and the terminal trading atmosphere is light. The price of PP market fell this month, and the contradiction between supply and demand in the market increased. Close to new year’s day, two oil actively go to storage, inventory to maintain a low level. Under the current situation of spot weakness, the lower reaches make up for the low price, and the merchants maintain the low inventory operation. It is estimated that there are 580000-620000 tons in the first warehouse at the beginning of January. At the end of the month, the average operating rate of domestic polypropylene enterprises is 96.24%. It is expected that the operating rate of domestic polypropylene enterprises will rise in early January.

 

3、 Future forecast

 

PP analyst of business club thinks: PP analyst of business club thinks: domestic PP price fell in December in general. The upstream propylene market is weak and the cost side support is poor. Downstream factories buy at low price and continue the strategy of rigid demand. The price of petrochemical plant has been lowered, the confidence of the operators is insufficient, the quotation keeps falling, and the operation is cautious. It is expected that PP market will continue to adjust at a low level in the near future. It is suggested to pay close attention to the change of propylene market at the cost end in the near future.

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