SunSirs: Demand Weakened, Propylene Price Was Down 3.7% (December 5-9)

Price trend

According to the data monitoring of SunSirs, the domestic propylene (Shandong) market fell one after another this week. The average price of the Shandong market at the beginning of the week was 7,720 RMB/ton, and the average price at the weekend was 7,434 RMB/ton. The weekly decline was 3.7%, while up 2.62% from 30 days ago.

Analysis review

According to the monitoring of SunSirs, propylene fell back after rising this week, and the price rose like a flash in the pan. The price fell back rapidly due to the lack of real order support. Since the beginning of the week, due to the high price last week, the profit of downstream polypropylene and other products was tightened, the operating rate was reduced, and the procurement was restrained. In order to stabilize the delivery of propylene, the prices of propylene enterprises lowered the prices successively. On the news side, the crude oil price continued to drop, further depressing the mentality of the industry. As of this Friday, Shandong's mainstream quotation was 7,400-7,450 RMB/ton.

Upstream: On the cost side, the crude oil price continued to decline this week. As of the closing of December 9, the WTI fell 0.44 to 71.02 US dollars/barrel in January 2023, down 0.62%; In February 2023, Brent fell 0.05 to 76.10 US dollars/barrel, a decrease of 0.07%. The price of crude oil hit a new low in the year, and the cost of propylene moved downward.

Downstream: The market of some products in the downstream mainly declined. In the past three months, the market showed a small rise and a sharp fall. The decline of some products exceeded 20%. In order to control the profit, the manufacturer reduced the load and the demand for propylene was restrained.

Market outlook

According to the propylene analysts from SunSirs, the expectation of economic recession does not decrease. With the accumulation of upstream inventory and low enthusiasm for downstream procurement, it is expected that propylene will still have room for decline next week.

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