Report Title - "PP Weekly Report 20251012: Supply and Demand Pressure and Cost End Collapse, Polyolefin Prices Decline" [1][2][7] Core Viewpoints - Polypropylene is in a downward oscillation phase, and the later price center is expected to decline. PP is in a production capacity release cycle, with new devices being put into operation one after another, and the existing production load is also high, resulting in significant supply pressure. Although demand has entered the peak season, it fails to meet expectations and is unable to digest the high production volume. Under the situation of supply-demand surplus, the price center of PP may continue to move downward [6]. - After the holiday, the PP price gapped down, and the bearish sentiment was further strengthened compared to before the holiday. On one hand, it was due to cost factors, such as the decline in Saudi Arabia's October CP and OPEC's announcement of continued production increase in November, which led to a decline in the cost of crude oil and PS. On the other hand, the fundamental situation remained weak, with a significant accumulation of inventory after the holiday. The demand in the peak season was limited, and the purchasing enthusiasm was poor. Additionally, there was a political risk on Friday, as Trump's attitude towards China became more aggressive, and tariffs were re - imposed, causing a sharp decline in the price of crude oil in the commodity market and further pressuring the polyolefin price [9]. Industrial Chain Operation Suggestions Inventory Management for Sellers - For those with high inventory and worried about PP price decline, they can short futures contracts on the disk for the PP to be sold to prevent price decline risks (contract: pp2601, entry price: 6950, hedging ratio: 50%) or buy put options on the disk (contract: pp2601 - P - 6900, entry price: 112, hedging ratio: 50%) [4]. Procurement Management for Traders - To build inventory and seek to buy PP at a low price, they can buy call options in proportion to control procurement costs and prevent price increases (contract: pp2601 - C - 6900, entry price: 125, hedging ratio: 100%) [4]. Procurement and Inventory Management for Terminal Customers - When in need of PP raw materials and worried about price increases, they can buy call options in proportion to control procurement costs (contract: pp2601 - C - 6900, entry price: 125, hedging ratio: 100%); when having raw material inventory and worried about price declines, they can short futures contracts on the disk in proportion (contract: pp2601, entry price: 6950, hedging ratio: 50%) or buy put options (contract: pp2601 - P - 6900, entry price: 112, hedging ratio: 50%) [4]. Market Data Analysis Supply - Domestic production: This week, the PP output was 79.62 million tons (+1.62 million tons), and the operating rate was 77.75% (+1.14%). During the holiday, the devices were restarted one after another, leading to an increase in PP output and a decline in loss volume, intensifying the supply pressure [10]. - Imports and exports: According to customs data, in August, the PP import volume was 24.70 million tons, a month - on - month decrease of 12.54%, and the export volume was 27.59 million tons, a month - on - month increase of 4.67%. China's net PP import was - 2.89 million tons, a month - on - month decrease of 233.72%. The export volume exceeded the import volume again [10]. Demand - After the holiday, the comprehensive downstream operating rate was 51.76%, a slight month - on - month decline of 0.08% compared to before the holiday. The operating rate of plastic weaving increased by 0.38%, supported by the increased demand for fertilizer packaging in agriculture and the resumption of construction in industries such as construction and infrastructure. After the holiday, the demand cooled down, and the operating rates of BOPP and CPP decreased by 0.67% and 1.68% respectively. The operating rate of PP pipe materials remained stable. The consumption in the automotive and home appliance industries was strong, and with the arrival of the peak season, the operating rate of modified PP increased by 0.38%. Although there is still room for improvement in the traditional peak season, the overall performance is relatively weak and unable to digest the high supply volume [10]. Inventory - The inventory of production enterprises increased by 16.11 million tons to 68.14 million tons, including an accumulation of 4.5 million tons in the inventory of two major oil companies, 7.07 million tons in coal - chemical industry inventory, 0.83 million tons in PBI inventory, and 3.71 million tons in local refinery inventory. During the holiday, upstream trading stagnated, and the inventory accumulated seasonally with a considerable increase, putting significant pressure on the upstream [10][206]. - The inventory of traders increased by 7.39 million tons, and the port inventory increased by 0.22 million tons, with an increase in the proportion of foreign resources in the domestic market [209]. Cost - During the holiday, the crude oil price rebounded after a decline and then fell again this week, especially dropping to around $62 per barrel on Friday. The main reasons for the decline during the holiday were OPEC+'s plan to increase production by at least 137,000 barrels per day in November and the first - stage cease - fire agreement between Palestine and Israel, which alleviated geopolitical concerns. On Friday, Trump's attitude towards China became more aggressive, reigniting tariff risks and causing a sharp decline in crude oil prices. However, the profit of oil - based PP has remained at a relatively good level in recent years [10][64]. - The LPG price continued to decline, and the profit of PDH - based PP improved month - on - month [11][64]. - After the holiday, the downstream demand for thermal coal was poor, and procurement slowed down. There is a certain downward space for coal prices, and the CT0 profit remained high. Due to the tight supply - demand situation, the price of methanol at the production area was firm, and the profit of inland MTO was under pressure and deteriorated [11][64]. Market Structure Analysis Basis and Spread - Basis: The spot price of plastic standard products also declined, with certain shipment pressure. The basis strengthened slightly compared to before the holiday. The basis in East China strengthened by 30 to around - 100 yuan per ton, the basis in North China strengthened by 50 to around - 130 yuan per ton, and the basis in South China strengthened by 40 to around - 100 yuan per ton [19]. - Non - standard basis: The trend of non - standard basis was stronger than that of standard products [19]. - Regional spread: The North China - East China spread remained at a medium level, and the South China - East China spread further weakened [31]. - Related product spread: The injection molding - drawing spread was at a low level, and the low - melt copolymer - drawing spread strengthened [32]. - Disk spread: The 1 - 5 month spread remained at around - 40. The L - PP01 spread strengthened slightly to over 300, and the PP - V01 spread was relatively stable. Overall, the supply pressure of PP was greater, while there were more maintenance activities for L and the demand for agricultural films started, and the demand recovery of PP was relatively slow, so the L - PP spread gradually repaired upwards. After the holiday, the price of PP dropped more due to the pressure on the cost side of PG, further strengthening the spread [50]. Domestic Production - End Profit and Supply - Production profit: The profit of oil - based PP remained at a relatively good level in recent years; the profit of PDH - based PP improved month - on - month; the profit of CT0 remained high, while the profit of inland MTO was under pressure and deteriorated [64]. - Domestic output and load: This week, the PP output was 79.62 million tons (+1.62 million tons), and the operating rate was 77.75% (+1.14%). During the holiday, the devices were restarted one after another, leading to an increase in PP output and a decline in loss volume, intensifying the supply pressure [10][105]. - Scheduling ratio: The increase in the scheduling ratio of drawing may indicate that the short - term standard product is stronger than the non - standard product, but the medium - term supply pressure may increase [114]. US Dollar Price and Import - Export Profit - US dollar price: The prices in Northwestern Europe and the Americas have fallen from high levels. The Asian price has continued to be weak, with oversupply and weak demand in the Far East of CRB, and low prices in Southeast Asia due to sufficient supply and the impact of low - cost domestic goods; the supply - demand situation in South Asia is also poor [126]. - Import - export profit: The domestic market is in weak consolidation. Production enterprises' export offers remain stable, but overseas inquiries are few, and the transaction volume is limited. In terms of imports, China's prices are at the "global low point," and it is difficult to open import arbitrage opportunities [144]. Downstream Operating Rate - After the holiday, the comprehensive downstream operating rate was 51.76%, a slight month - on - month decline of 0.08% compared to before the holiday. The operating rate of plastic weaving increased by 0.38%, while the operating rates of BOPP and CPP decreased by 0.67% and 1.68% respectively. The operating rate of PP pipe materials remained stable, and the operating rate of modified PP increased by 0.38% [10][147]. Position, Trading Volume and Warehouse Receipt Situation - The position volumes of PP_01, PP_05, and PP_09 contracts on October 10, 2025, were 658,901, 549,555, and 700,000 respectively [223][224][227]. - The trading volumes of PP_01, PP_05, and PP_09 contracts on October 10, 2025, were 1,500,000, 927,840, and 2,781,596 respectively [228][237][235]. - The number of registered PP warehouse receipts on October 10, 2025, was 17,191 [241].
PP周报：供需承压与成本端暴跌，聚烯烃价格下行-20251014
Zhe Shang Qi Huo·2025-10-14 05:21