SunSirs: Demand Fell, China PP Market Sorted Out after decline in October

According to the Commodity Market Analysis System of SunSirs, the PP market first fell and then stabilized in October, and the prices of various wire drawing brands were overall reduced. As of October 31st, the mainstream quoted price of T30S (wire drawing) by domestic producers and traders is around 7,742.86 RMB/ton, with a decrease of -2.95% compared to the average price level at the beginning of the month.

Industry chain: In terms of PP raw materials in October, the domestic propylene market rebounded after falling due to the impact of crude oil fluctuations. As of the end of the month, it has not yet recovered to the price level at the beginning of the month. During the month, the European and American economies and geopolitical conflicts caused fluctuations in crude oil prices, resulting in a weak market and a simultaneous decline in PDH. At the end of the month, the trend of propane was poor, with only significant stability and small fluctuations in methanol. The upstream raw materials are generally weak, with poor support for PP.

The raw material flow in all directions is weak, and the cost side's support for PP is weakened. In terms of industry load, the average industry load in October was around 79%, which fluctuated and adjusted during the month, with the position almost unchanged compared to the previous period. The overall supply of goods is stable, but in the second half of the month, some companies experienced unplanned maintenance, resulting in a decrease in on-site supply pressure. In terms of demand, the downstream production of plastic weaving remains at over 45%, while the production rate of film and injection molding enterprises remains around 60%, and the overall position remains stable. Terminal enterprises mainly purchase according to demand, with average trading activity, and the overall market for wire drawing materials is weak.

In terms of fiber materials, according to the commodity market analysis system of SunSirs, as of October 31, the spot price of domestic fiber PP also fell and stabilized. The mainstream quoted price of domestic producers and traders for Z30S (fiber) is around 7,675 RMB/ton, with an increase or decrease of -4.36% compared to the average price at the beginning of the month, and a decrease of 4.46% compared to the same period last year. Within the month, the main downstream non-woven fabric enterprises of PP fiber material were operating with a horizontal load, and the operating rate was around 37%. The demand for fiber materials in the market is orderly, and the prices of non-woven fabrics are in line with the market. The digestion speed of end products is normal. It is expected that in the short term, fiber materials may continue to suffer from cost and supply drag, and the consolidation market will continue.

In terms of melt blown materials, the recent melt blown PP market has experienced narrow fluctuations. As of October 31st, the average quotation of domestic melt blown material sample enterprises monitored by the Commodity Market Analysis System of SunSirs is around 8,350 RMB/ton. Compared with the average price level at the beginning of the month, the price has increased or decreased by 0%, with a year-on-year decrease of 7.39%. At present, the demand for facial protection in China has returned to normal, and the consumption of medical meltblown fabric materials is generally driven. There is also no significant boost in domestic and foreign demand. The main benefits of melt blown materials are concentrated on the cost side, and it is expected that the melt blown material market may maintain a sideways consolidation trend.

PP analysts from SunSirs believe that the polypropylene market stabilized after a decline in October. The overall trend of upstream raw materials is poor, and the cost side's support for the market is weakened. Terminal enterprises maintain their initial level of construction, and their purchasing operations tend to be weak and rigid. The current maintenance of some PP devices is about to begin, and it is expected that the PP market may be dragged down by the positive impact of supply contraction in the short term, leading to a more stable operation.

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