gonzosquestmegaways| Polypropylene supply supports demand repair inventory down 14% compared with last year

News summary

The polypropylene market benefits from supply-side support and a warmer macro atmospheregonzosquestmegaways, demand repair is expected to increasegonzosquestmegaways, despite the risk of short-term correction, the overall operation trend is strong.

Newsletter text

[Polypropylene market: Demand repair is expected to rise, but there is still support on the supply side] Investors should pay attention. The wire drawing and arrangement rate on the supply side has dropped to 24% at a low level, and the device load is low, providing structural support for the polypropylene market. On the demand side, the auction atmosphere for coal chemical industry is good, with a wire drawing transaction rate as high as 81%. Although some downstream streams have entered the seasonal off-season and market demand is not strong, the policy of replacing old appliances with new ones may bring room for demand to repair. Recently, commodities such as non-ferrous metals and precious metals have continued to rebound, and the overall market atmosphere is favorable to polypropylene. The introduction of a number of real estate policies in the domestic market, coupled with the support for replacing old home appliances with new ones, has warmed the macro atmosphere, enhancing the market's expectation of restoring demand for polypropylene. Polypropylene is currently in a low absolute price and low valuation state, and the recent installation load has been low, which has contributed to the strong operation of polypropylene prices. However, we need to be vigilant against the pressure on crude oil prices after a sharp short-term rebound and the risk of short-term correction that polypropylene may face. Data with high market attention include the reduction of PP wire drawing production rate to 23gonzosquestmegaways.62%, and the fiber yield rate was increased to 9gonzosquestmegaways.80%, the homopolymer injection molding schedule was reduced to 12.23%, and the copolymer injection molding schedule was increased to 18.25%. In addition, the inventory level of major producers today is 870,000 tons, a decrease of 1.14% from the previous working day of 10,000 tons. In the same period last year, the inventory was approximately 770,000 tons. When analyzing the polypropylene market, investors should consider the above-mentioned supply and demand dynamics and the impact of policies, while paying attention to inventory levels and market transaction data to make more informed investment decisions.

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