Price Trend

According to the data from the business associations’list, the market price of propylene in Shandong Province has fallen continuously since January 9, 2019. On January 9, the average price of propylene in Shandong Province was 8306 yuan/ton. By January 14, the average price of propylene in Shandong Province had fallen to 7920 yuan/ton, with a drop of 4.69% in six days.

II. Analytical Review

Products: Recently, the domestic propylene (Shandong) price has fallen sharply. At present, the mainstream market turnover has dropped to 7700-8000 yuan/ton. After the continuous rise of the market in the early period, although the supply and demand have not changed much in the near future, but refinery shipments are not smooth in the early period, and the overall trading mentality is cautious. Refineries are active in delivering goods in order to preserve inventory space during the Spring Festival.

Industry chain: In the upstream, crude oil revenue rose in 2019, the longest trend in nine years. However, due to the long downward momentum and time of crude oil market in the early stage, raw material stocks of enterprises are relatively sufficient, that is, the price of crude oil corresponding to propylene is still low, and the cost support is not obvious. Downstream, polypropylene futures prices continue to be depressed, PP powder profit is not high and there is a downward trend or parking trend. Near the Spring Festival, the downstream enterprises are only purchasing raw materials on the premise that they have sufficient propylene reserves, and some enterprises have begun to consume stocks.

3. Future Market Forecast

In conclusion, propylene refinery shipments are more positive, market sentiment is strong, and trading atmosphere is cautious; upstream crude oil is rising, but the low-price inventory of refinery is still in the early stage, so the support is limited; downstream polypropylene futures prices are low, PP powder has a negative trend or parking trend, so propylene is expected to still have some downward space before the festival, and later sales. Prudence.