[PP Weekly Review] Market Focus Slightly Declines This Week, Continuing Weak Trend Next Week

1Market Review: This week, the domestic PP market operated weakly, with prices continuing to decline.

This week, the domestic PP market showed a weak trend with prices continuing to decline.As of this Thursday, the weekly average price of East China drawing wire stood at 6,890 yuan/ton, down 72 yuan/ton from the previous week, a decrease of 1.03%. The regional price difference for drawing wire showed little change. In terms of varieties, the production level of low-melting copolymer continued to decline during the week, with traders maintaining some intention to support prices. The price drop was less than that of drawing wire, and the price gap between drawing wire and low-melting copolymer continued to widen.

2. Market Outlook: The supply and demand fundamentals are weak, and the market is expected to trend lower next week.

The PP market is expected to remain weak next week.Taking East China as an example, the price range for wire drawing is expected to be between 6,750-6,950 yuan/ton next week, while the low melt copolymer price range is expected to be between 6,950-7,150 yuan/ton, with the average price estimated at 7,070 yuan/ton. On the cost side, crude oil is expected to fluctuate mainly, providing limited guidance on the cost side for PP. On the supply side, some facilities are scheduled for maintenance next week, and the intensity of maintenance is expected to increase, resulting in a slight reduction in supply. On the demand side, new orders in most downstream sectors are limited in follow-up, and although some companies have new orders, the profit margins are thin, leading to a lack of enthusiasm for procurement downstream, with overall demand showing weakness. In summary, although the pressure on the supply side is expected to ease next week, demand remains weak, restricting market upward movement. Coupled with limited guidance from the cost side, it is expected that the PP market will continue its weak trend next week.