SunSirs: Demand Weakening Businessmen Let Profit Fall in August PP Shocks

　　1.Price Trend

　　According to the data monitored by SunSirs, the PP market in August was in a turbulent downward trend and prices were lower. As of August 30, the mainstream offer price of T30S by domestic producers and traders was around RMB 8566.67/ton, a drop of 2.65% compared with the beginning of the month.

　　2.Cause analysis

　　Upstream: As for propylene, the international crude oil market fluctuated sharply this month, with several sharp downturns, and then steadily rebounded, which had a phased impact on propylene. At present, there are some shortcomings. The profit margin of downstream factories is still acceptable, and purchasing enthusiasm is good. Acrylic acid prices have increased this month, but the overall downstream demand is general, more wait-and-see mentality, is expected to maintain stable operation in the near future or will have less impact on propylene; while propylene oxide prices have fallen after this month's rise, which has little impact on propylene; n-butanol prices have increased continuously, rising as high as 4.69% in seven days. Good propylene market; at present, on-site inventory is tight, manufacturers have pressure on sales in the middle of the month, to ease at the end of the month, propylene prices are expected to rise in the near future.

　　Products: In August, the overall price of PP market has been lowered and the weakness has been adjusted. This month's overhaul capacity was 348,800 tons, an increase of 37.43% over July's 258,800 tons, and the investment of new equipment was not as good as expected. Cost support from propylene has decreased, downstream demand for PP is flat, the trading atmosphere is general, and the manufacturer has lowered the ex-factory price. However, the stock of raw materials on the demand side is low, and there may be a motive force for replenishment after the price falls. This month PP futures also shocked lower, suppressing the mindset of traders, near the end of the month traders multi-dimensional stable offer. Zhenhai Refinery (Sinopec East China) PP ex-factory price, drawing T30S quoted RMB 8800/ton. Jiujiang Petrochemical (Sinopec East China) PP ex-factory price, drawing T30S offer for RMB 8600/ton. Fushun Petrochemical (CNPC East China) PP ex-factory price, drawing T30S quoted RMB 8300/ton. Daqing Petrochemical (CNPC Northeast) PP ex-factory price, drawing T30S quoted RMB 8550/ton. Dalian Organic PP (CNOOC Northeast) ex-factory price, drawing T30S quoted RMB 8400/ton.