Report Overview - Report Title: Polyolefin Weekly Report [1] - Report Date: January 11, 2026 [2] - Analyst: Zhou Fuqiang [2] Investment Rating The report does not mention the industry investment rating. Core Views PE - The supply of PE is expected to remain relatively loose in the future, with increased imports at the end of 2025 and the beginning of 2026. The demand from downstream industries such as agricultural films and packaging films is in a seasonal off - peak period, and the market supply - demand pattern is not optimistic. The price is under pressure before the Spring Festival [5][6]. - The cost - side support for PE is average, and the inventory de - stocking is not smooth. The market is in a pattern of increasing supply and decreasing demand, and the price is expected to fluctuate, with a suggestion of shorting on rebounds [6]. PP - In the off - season, the PP price is under pressure. The supply center has declined recently, and the Q1 PDH device maintenance plan has increased. The import and export volumes are expected to remain at a basic level in the short term [92]. - The downstream demand is mixed, with some industries showing weakening demand and others having certain support. The overall inventory de - stocking is not smooth, and the market supply - demand pattern is not optimistic. It is recommended to short on rebounds [93][94]. Summary by Directory PE Section Price & Spread - The futures price of PE has shown a strong and volatile trend, with the basis remaining stable, and the 5 - 9 month spread strengthening to - 31. The production profit of different processes has different degrees of change, with the oil - based profit at - 520 (+30), and the coal - based at - 80(+70) [6]. - The domestic and overseas prices and spreads of PE have changed, with the Chinese arrival price increasing by 10 - 30 dollars, and the import window gradually opening [15][24]. Supply - In 2025, the total effective capacity growth rate of PE was 16%, and the domestic production growth rate was 18%. The overall start - up rate was 83.7% (+0.4%). Although there were some maintenance and production conversions, the supply was still relatively high [6]. - The import of PE is expected to increase at the end of 2025 and the beginning of 2026, and the new order imports are relatively cautious [6]. Demand & Inventory - The demand from downstream industries such as agricultural films and packaging films is in a seasonal off - peak period, with the agricultural film start - up rate decreasing and the demand for raw materials expected to decrease [6]. - The inventory de - stocking of PE is not smooth, with the social inventory de - stocking slowing down, and attention should be paid to whether the inventory can be transferred downstream [6]. PP Section Price & Spread - The basis of PP is weakly volatile, and the month spread is weakening. The production profit of different processes is under pressure, with the oil - based profit at - 1300 (+10), and the coal - based at - 220(-50) [94]. - The Chinese arrival price of PP has rebounded, and the import window is tending to open, but the export profit to Southeast Asia has limited increase [108]. Supply - In 2025, the total effective capacity growth rate of PP was 12.7%, and the annual production growth rate was 16.7%. The Q1 PDH device maintenance plan has increased, and the supply center has declined [92]. - The PP import volume is expected to be limited in the short term, and the export volume is also restricted by factors such as freight and overseas demand, and is expected to remain at a basic level [92]. Demand & Inventory - The downstream start - up rate of PP has declined, but the demand for some industries such as BOPP films is relatively good. The overall inventory de - stocking is not smooth, and the inventory is relatively high compared to the same period [93][94].

1. Report Industry Investment Rating - Not provided in the content 2. Core Viewpoints of the Report - PE prices are expected to be under pressure in Q4 due to the pattern of increasing supply and decreasing demand. The cost - end support is average, and the market supply - demand situation is not optimistic. The strategy suggests a bearish view on the single - side market, a 1 - 5 reverse spread strategy, and no recommendation for cross - variety trading [6][7][8] 3. Summary by Relevant Catalogs 3.1 Viewpoint Overview - **Supply**: The total effective capacity growth rate is 16%, and the domestic production growth rate is 18%. Although imports have declined year - on - year, the overall supply is loose, suppressing prices. The PE total start - up rate is 83.14% (+0.55%). There will be a slight decline in supply next week, but Q4 is expected to maintain a loose supply, with an increasing trend at the end of the year. The US has inventory clearance needs, and imports may remain high at the beginning of the new year [6] - **Demand**: The overall start - up rate of agricultural films is flat, and it has reached the annual high, with limited room for further increase. The start - up rate of PE packaging films is - 0.37%, and that of PE pipes is flat, while the start - up rate of PE hollow products is - 0.44%. The downstream performance is neutral, with the support of peak - season demand, but the willingness to hold goods is average [7] - **Viewpoint**: The cost - end support of PE is average. The demand - side support is strong, but considering the high start - up rate of agricultural films and the increasing supply pressure at the end of the year, the market supply - demand pattern is not optimistic. The market may enter a pattern of increasing supply and decreasing demand in Q4, and prices will be under pressure [8] - **Valuation**: The basis has been significantly repaired, and the month - spread has rebounded from a low level, while the warehouse receipts are still at a high level. The production profit of different processes shows different trends, and the variety comparison also has corresponding changes [8] 3.2 Polyethylene Spread and Profit - **Price Spread**: The domestic spot and futures prices, as well as the basis, month - spread, and non - standard price spread, have shown certain changes. The overseas prices of PE are weak and stable, and the import window is open [12][16][22] - **Raw Material Price**: Crude oil is oscillating at a low level, naphtha is sideways, ethylene has stabilized after a decline, and coal prices are relatively strong [36] - **Production Profit**: The overall profit is compressed, especially in the monomer link. The profits of MTO and externally - purchased ethylene processes have been repaired [42] 3.3 Polyethylene Supply and Demand - **New Capacity**: From the end of 2024 to the first half of 2025, the nominal capacity growth rate of standard products reached 19.2%, and the effective capacity growth rate was 16.7%. The phased production of standard products has ended, and there will be limited capacity expansion before the 2605 contract [46] - **Existing Start - up**: The supply of standard products is at a neutral level, and the supply will decline slightly in November due to increased maintenance [50] - **Maintenance Plan**: There is an expectation of a decline in subsequent maintenance, and the monthly maintenance volume in Q4 is temporarily lower than that of last year [53] - **Import and Export**: Domestic production has increased significantly, and imports are at a low level year - on - year. The imports of standard products are at a low level, and the imports from the US and Southeast Asia have decreased year - on - year [57][60] - **Inventory**: As supply gradually recovers and upstream enterprises try to hold prices, factory inventories are accumulating. The LD factory inventory has slightly decreased, and the middle and downstream are mainly digesting previous inventories [65][68] - **Downstream Demand**: The start - up rate of agricultural films is at a high level but is expected to peak. The start - up rate of packaging is the same as last year, and the demand for pipes has slightly improved in Q4. Overall, the downstream demand shows marginal decline signs [70][73][75][79]