According to the Commodity Market Analysis System of the Business Society, the PP market continued to decline last week, with overall reductions in various wire drawing brands. As of May 22nd, the mainstream quoted price of T30S (wire drawing) by domestic producers and traders is around 7142.86 yuan/ton, with a decrease of -7.32% compared to the average price level at the beginning of the month.

Cause analysis

Industry chain: On the upstream side, the recent low point recovery in the Shandong propylene market has been slight. In the early stage, crude oil continued to weaken and rebounded last week, directly benefiting the spot price of propylene on the cost side. Downstream devices are operating and maintaining, with limited procurement volume, and the export pressure of propylene enterprises remains unchanged. The current market wait-and-see atmosphere is still strong, and it is expected that the Shandong propylene market will be mainly organized and operated. It is recommended to closely monitor the cost side news.

The narrow rebound in propylene prices does not significantly improve the cost support for PP. In terms of industry load, the overall industry load remained at around 75% last week, and recent shipments have remained generally stable with expectations of an increase in supply. There is sufficient supply of goods on the market, and inventory pressure has increased, with poor support from the supply side for spot prices. Meanwhile, the continued decline in futures dragged down the spot market. In terms of demand, the downstream plastic weaving production of the main force has slightly declined, and the operating rate of film material enterprises has recovered to 40%. The stocking situation of terminal enterprises is poor, and procurement is mainly maintained for production.

In terms of fiber materials, according to the Commodity Market Analysis System of Business Society, as of May 22, the spot price of domestic fiber PP has declined. The mainstream quoted price of domestic producers and traders for Z30S (fiber) is around 7287.50 yuan/ton, with an increase or decrease of -5.36% compared to the average price at the beginning of the month, and a decrease of 17.96% compared to the same period last year. Last week, the low load of downstream non-woven fabric enterprises, the main force of PP fiber material, continued horizontally, with an overall operating rate of around 30%. The current weak demand for fiber materials on the site is dragging down the digestion speed of non-woven end products, and the enterprise’s efforts to replenish fiber PP are lagging behind. In addition, the supply side’s bearish situation is expected to remain weak and stable in the short term.

In terms of melt blown materials, last week’s melt blown PP market saw a narrow decline. As of May 22nd, the average quotation of domestic melt blown material sample enterprises monitored by the Commodity Market Analysis System of the Business Society is around 8125 yuan/ton. Compared with the average price level at the beginning of the month, the price has increased or decreased by -0.91%, with a year-on-year decrease of 17.42%. At present, the domestic health events are stabilizing, and local news in society is unable to drive the consumption of medical meltblown fabric materials. The overseas demand has also not shown significant support, and traders have given up on orders, indicating that the melt blown material market may maintain a weak consolidation trend.

Future Market Forecast

PP analysts from Business Society believe that the polypropylene market has recently declined. The raw material propylene market is generally stable at a low level, with poor support from the cost side for the market. Terminal enterprises tend to maintain production while receiving goods, with weak demand release. The market is biased towards bearish guidance, and it is expected that the PP market may maintain a weak consolidation trend in the short term.