Trend analysis: From weakness to stalemate
Early January: Continued weakness: Under the dual pressure of high supply and weak demand, the market consolidated weakly within the lowest price range of the past five years.
Mid-January: Cost-driven, difficult upward movement: Driven by the rising price of upstream raw material propylene oxide, factories tentatively increased their quotations. However, downstream acceptance was low, and the market fell into a stalemate of "neither rising nor falling."
According to the business data analysis system of SunSirs, as of January 16th, the average price of propylene glycol in Shandong province was 6,016 RMB/ton, remaining unchanged from the beginning of the month.
Analysis of Key Influencing Factors
The core contradiction in the current market was the double pressure from both "cost push" and "demand pull":
Cost support was strengthening: The price of the main raw material, propylene oxide, was trending upwards, continuously driving up the production cost of propylene glycol, which was the core force supporting market prices and preventing further declines.
Supply and demand pressures persisted:
Ample supply: There were no major plant shutdowns for maintenance in the first half of the month, resulting in overall ample supply.
Weak demand: Demand from major downstream industries (such as unsaturated resins and polyether industries) remained sluggish. Downstream manufacturers mainly focused on depleting existing inventory and purchasing only as needed, showing low acceptance of high-priced raw materials.
Short-term market outlook
Overall, the propylene glycol market is expected to continue its narrow range of fluctuations in the short term.
Upside resistance: If downstream demand does not improve effectively, price increases driven solely by cost factors will be difficult to sustain, and the market will face downward pressure after reaching a peak.
Downward support: As long as the price of the raw material propylene oxide remains high, the cost base of propylene glycol will be very solid, and the room for a significant price drop will be very limited.
Overall, in the first half of January, the propylene glycol market attempted to recover from its slump supported by strong cost factors, but weak demand made its upward movement difficult, resulting in a typical stalemate.
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