According to the Commodity Market Analysis System of SunSirs, the domestic PP market fluctuated and fell at the end of November, with prices of various brand products falling more and rising less. As of November 26th, the benchmark price for PP wire drawing offered by SunSirs was 6,363.33 RMB/ton, a decrease of -5.35% compared to the price level at the beginning of November.
In terms of raw materials: Entering the end of the month, international crude oil is affected by OPEC+ new round of production increases and the easing of regional tensions, causing concerns among industry players about long-term oversupply. On the other hand, the weakening of US demand and the impact of US tariffs on global economic and demand expectations have led to a decline in international oil prices. In the early stage of propylene inventory digestion, the supply of goods has tightened, and the company's sales are not under pressure, with controlled shipments. Affected by this, the spot price of propylene continues to rise. The external market for propane remains strong, with port cargo leading the increase and prices rising. Overall, the prices of various raw materials for PP have fluctuated, providing moderate support for PP costs.
Supply side: At the end of November, domestic PP enterprises experienced a mutual restart and maintenance. As of the time of writing, the overall load level of the domestic industry is around 77.5%, with little difference compared to the mid month. The current weekly average total production is close to 810,000 tons, and the inventory position is around 870,000 tons. Previously, there were restarts of Zhenhai Refining and Chemical Third Line, Jingbo Petrochemical Second Line, and Luoyang Petrochemical Second Line. Later, there were some equipment failures and maintenance at Shanghai SECCO, as well as short shutdowns at Dushanzi Old Second Line. The loss of production capacity was basically offset, and the on-site supply remained abundant. Overall, the supply side's support for spot prices has flattened.
In terms of demand: The early Double 11 e-commerce festival had limited impact on improving the market trading atmosphere by stimulating consumption in packaging, home appliances, and other areas. The current PP terminal enterprise finished product market is generally hot, and the digestion of raw materials is slow, resulting in a low willingness to build raw material warehouses. Combined with the fact that the results of the China US talks at the beginning of the month did not meet market expectations, it did not provide a strong boost to the mentality of industry players. At the same time, the impact of the Federal Reserve's interest rate cuts and trade protectionism is still present, dragging down the export of end products, and the load position of downstream enterprises is not ideal. At the end of November, following the previous light trading pattern, the industry's supply base was large and did not match the weak demand of terminal factories, making it difficult for market momentum to support PP spot prices.
At the end of November, the domestic PP market prices fluctuated and fell. Fundamentally speaking, the upstream raw material market is fluctuating, and the overall support for PP is average. The industry load remains stable at a high level, with limited improvement in consumption. Under the large base production capacity, the loose supply pattern remains unchanged, and there is a lack of motivation to further digest inventory. It is expected that the PP market will continue to adjust.
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