SunSirs: Monthly Data Release for the Propylene Industry Chain

According to Sina Finance, the average price of the domestic propylene market continued to rise in April 2026. The monthly average price in the mainstream propylene market in Shandong was 9,201.33 RMB/ton, an increase of 1,059.72 RMB/ton compared to the previous month’s average of 8,141.61 RMB/ton, representing a rise of 13.02%; In the East China region, the monthly average price in the mainstream propylene market was 9,408.33 RMB/ton, up 1,051.23 RMB/ton from the previous month’s average of 8,357.10 RMB/ton, representing a rise of 12.58%; The monthly average price in the mainstream market of the Northeast region was 8,940.67 RMB/ton, an increase of 1,158.57 RMB/ton compared to the previous month’s average of 7,782.10 RMB/ton, representing a rise of 14.89%.

I. Review of Macroeconomic and Raw Material Markets

In April, news regarding US-Iran negotiations caused market volatility, leading to a downward trend in international oil prices. The methanol market was frequently affected by macroeconomic developments, whilst the supply-demand balance remained tight, providing strong support for the market and keeping prices at elevated levels. With crude oil prices strengthening and overall domestic propane supply remaining tight, producers showed a strong willingness to maintain prices, resulting in an upward trend in propane market prices; Against the backdrop of high raw material prices, favorable cost-side support was evident, and producers were strongly inclined to maintain prices.

II. Propylene Market Analysis

As of 30 April, the average price of propylene stood at 9,630 RMB/ton, an increase of 880 RMB/ton (10.06%) from the end of last month’s price of 8,750 RMB/ton, with prices generally trending upwards throughout April. At the beginning of the month, some propylene plants in Shandong, East China and Northeast China reduced operating rates or shut down, leading to tight spot supply. The restart of some polypropylene plants, coupled with active downstream demand, drove prices higher; Subsequently, the restart of a PDH unit in North China led to mounting cost pressures for downstream producers. This resulted in reduced operating rates at some polypropylene and cyclopropene units, causing demand to contract and prices to retreat from their highs. Later, amid fluctuating geopolitical tensions, the failure of US-Iran negotiations pushed up oil prices. Coupled with the shutdown of multiple propylene units in North and East China, whilst some cyclopropene units resumed feedstock supply, prices surged once again; Subsequently, as expectations of the restart of previously shut-down propylene units in Shandong emerged, a certain manufacturer resumed spot sales of propylene. Meanwhile, the shutdown of some butadiene and isobutylene units, coupled with a propylonitrile plant announcing maintenance plans, weighed on propylene prices from both the supply and demand sides. In the middle to late part of the month, a Shandong producer reduced its external supply, a PDH unit in East China shut down, and downstream buyers stocked up at lower prices, prompting producers to raise their offers; however, maintenance at an acrylonitrile unit and increased propylene sales from another producer caused the transaction price centre to slide once more. Towards the end of the month, with the shutdown of a few PDH units and pre-holiday restocking by downstream buyers, the market resumed its upward trend. Overall, with poor profit margins for downstream products and frequent reports of fluctuations in propylene and downstream facilities, the propylene market lacked sustained upward momentum and faced significant demand constraints, presenting an overall trend of “volatile fluctuations with high prices under pressure”.

III. Analysis of Downstream Market Conditions

Polypropylene Granules:

As of 30 April, the average market price for polypropylene granules stood at 9,333 RMB/ton, an increase of 83 RMB/ton (0.90%) from the end-of-month price of 9,250 RMB/ton. The price rise at the beginning of the month was primarily driven by expectations of tightening supply coupled with petrochemical enterprises raising their ex-factory prices, whilst rising crude oil costs provided support for market sentiment. From the middle of the month onwards, market sentiment shifted as crude oil prices retreated, weakening cost support. Furthermore, downstream demand entered a phase of inventory digestion, with purchasing enthusiasm declining significantly. Market sentiment shifted rapidly this month, moving from supply-side optimism to weakening costs and then to softening demand. Under the combined influence of these multiple factors, PP prices followed a pattern of rising sharply before falling back.

Polypropylene Powder:

As of 30 April, the average market price for polypropylene powder stood at 9,441 RMB/ton, up 357 RMB/ton from 9,084 RMB/ton at the end of last month, representing a 3.93% increase. Propylene prices have been driven higher by supply contraction and ongoing geopolitical risks. Powder producers are deeply mired in losses and show little willingness to concede on prices, thereby limiting the scope for price declines. Under pressure from high costs, several production units have successively shut down, with industry operating rates currently remaining at a low level of around 16%. Downstream demand, however, has been relatively weak. The price inversion between powder and granules has intensified, prompting downstream buyers to switch to granules as a substitute, with purchases driven primarily by essential needs. Throughout the month, prices remained stuck at high levels as costs and weak demand played out, with volatility narrowing.

Octanol:

As of 30 April, the average market price for octanol stood at 8,729 RMB/ton, down 512 RMB/ton from 9,241 RMB/ton at the end of the previous month, representing a decline of 5.54%. In the first half of the month, the octanol market initially rose before falling: at the start of the month, cost pressures, active downstream buying and support from export orders led to tight spot supplies, driving up negotiation levels; on 8 April, the US and Iran announced a two-week ceasefire, causing market sentiment to weaken, with downstream buyers postponing purchases and negotiation ranges shifting downwards. The second half of the month saw prices rise before falling: when prices dropped to 9,000 RMB/ton, downstream buyers took the opportunity to purchase at lower levels. Coupled with short-term shutdowns at some production facilities, spot supply remained tight, prompting market participants to defend prices and pushing negotiation levels up slightly within a narrow range; towards the end of the month, facilities undergoing maintenance resumed operations, but with weak orders from the key downstream plasticizer sector, enterprises remained cautious in their procurement and adopted a wait-and-see approach.

As of 30 April, the average price of octanol stood at 8,729 RMB/ton, down 512 RMB/ton from the end of the previous month’s price of 9,241 RMB/ton, representing a decline of 5.54%. In the first half of the month, the octanol market initially rose before falling: at the start of the month, cost increases, active follow-up from downstream sectors and support from export orders, coupled with tight spot supplies, drove up negotiation prices; on 8 April, the US and Iran announced a two-week ceasefire, causing market sentiment to weaken, with downstream sectors postponing purchases and negotiation ranges shifting downwards. The second half of the month saw prices rise before falling: when prices dropped to 9,000 RMB/ton, downstream buyers took advantage of the lower prices to purchase, whilst combined with short-term shutdowns at some plants, spot supply remained tight. Market participants held firm on prices, pushing negotiation ranges up slightly; towards the end of the month, plants undergoing maintenance resumed operations, but orders for plasticizers—the main downstream product—were poor. Companies adopted a cautious purchasing stance with a strong wait-and-see attitude, resulting in poor octanol transaction volumes, prompting companies to sell at reduced prices.

IV. Outlook for the Propylene Market

Looking ahead, the key drivers of the crude oil market in May will remain centered on US-Iran tensions and changes in the passage of the Strait of Hormuz. Provided that geopolitical risks do not show significant signs of easing, the overall price centre of crude oil is expected to remain at elevated levels. Although previously idled units may resume normal operations, the current overall operating rate of PDH units remains low, and some propane dehydrogenation units still have maintenance schedules in place. Inventory pressure on propylene producers remains manageable, which supports the propylene market. On the demand side, whilst some cyclopropane units are gradually resuming or planning to resume production, profit margins for most downstream products remain inverted. Consequently, acceptance of high-priced feedstock is low, with procurement largely limited to essential needs. With maintenance schedules for some polypropylene units now underway, demand remains weak, hampering propylene producers’ sales and weighing on market sentiment.

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