SunSirs:The Market Price of Propylene Oxide First Rose and Then Stabilized Last Week (June 16-20)

Price trend

Last week, the market price of propylene oxide first rose and then stabilized. According to the monitoring system of SunSirs, as of June 20th, the benchmark price of SunSirs' propylene oxide was 7,543.33 RMB/ton, an increase of 2.72% compared to the beginning of the month.

Price influencing factors:

Raw material side: The market price of raw material propylene had risen, with strong support from the cost side. According to the market analysis system of SunSirs, as of June 20th, the benchmark price of propylene in SunSirs was 6,613.25 RMB/ton, an increase of 1.15% compared to the beginning of this month (6,538.25 RMB/ton).

Supply side: The tight supply of propylene oxide market last week provided strong support for the rise in propylene oxide prices. As of the 18th, only the 200,000 tons/year PO/SM unit of Shenghong Petrochemical had resumed normal operation at 70-80% load, while the remaining Wanhua Phase III, Satellite Petrochemical, and Sinopec Changling units were planned to resume gradually from the weekend to the end of the month. The expected increase in volume during the month is limited, and the initial inventory during start-up is expected to be low.

Demand side: The downstream market for propylene oxide purchased based on demand, with limited new inquiries and cold terminal demand. Therefore, it was mainly a wait-and-see approach. Downstream demand for polyether was not fluctuating significantly, with rigid procurement being the main focus and some incremental procurement. The demand for propylene glycol was generally followed up, but some factories may resume production in the later stage, and there may be an increase in demand. Overall, there was still some support from the demand side for the propylene oxide market, and the market may experience narrow consolidation in the later stage.

Market outlook

SunSirs' propylene oxide analyst believes that the supply of propylene oxide was tight, with a slight increase in market prices. Downstream market demand was weak during the off-season, and there was passive follow-up. New inquiries were limited, so it was mainly a wait-and-see approach. It is expected that the propylene oxide market will mainly experience narrow consolidation in the later stage, and more attention should be paid to changes in raw material prices and downstream supply and demand.

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