1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - For plastics, the supply is under pressure, the market may continue to seek a bottom weakly. With the restart of devices and the increase in domestic and foreign supplies, while the demand side has insufficient restocking power and high inventory, the fundamentals have no upward driving force, so the previous short positions should be held, and short - selling on the short - term single side is not recommended [4]. - For PP, the weak fundamentals remain unchanged, and it will run weakly following the cost side. With high inventory, increasing supply, and weakening demand, there is a high de - stocking pressure in the future [9]. 3. Summary According to Relevant Catalogs 3.1 Plastic and PP Market Review - **Plastic**: This week, plastics opened high and closed low, with two consecutive negative weekly lines. It opened 16 points higher at 6915 on Monday, reached a weekly high of 6939, then fell unilaterally to a weekly low of 6745 on Thursday morning, and finally closed at 6802, down 97 points or 1.4% from last week's closing. The weekly amplitude was 194 points [3][13]. - **PP**: This week, PP also opened high and closed low, with two consecutive negative weekly lines. It opened 10 points higher at 6600 on Monday, reached a weekly high of 6629, then fell unilaterally to a weekly low of 6415 on Thursday morning, and finally closed at 6464, down 126 points or 1.9% from last week's closing. The weekly amplitude was 214 points [8][16]. 3.2 Valuation - For plastics, the basis and monthly spread are running weakly, and the single is at a year - on - year high. The oil - based valuation is at a medium level, and LLDPE is at a medium position in the same period [19][26][28]. - For PP, the valuation is moderately high [34]. 3.3 Production Capacity and Supply - **Production Capacity**: In 2025, the planned PE production capacity is 613 tons (year - on - year + 17%), with 463 tons already put into production from January to October and 120 tons remaining. The planned PP production capacity is 511 tons (year - on - year + 11%), with 456 tons already put into production from January to October and 45 tons remaining. In 2026, it is still in a high - production - capacity cycle, and the probability of PP device delay is relatively high, so the opportunity to shrink LP05 can be concerned [35]. - **Supply**: In November, the start - up rate shows an upward trend. The domestic polyethylene supply is increasing, with some devices planned to restart and new devices continuously ramping up production. This week, the PE output is 66 tons, with a capacity utilization rate of 83%. Since mid - September, the output has rebounded from a low level. The PP output this week is 80 tons, with a capacity utilization rate of 78%, and it is expected to continue to increase next week [36][38][46]. 3.4 Import and Export - **PE**: From January to September 2025, the cumulative import volume is 1000 tons (year - on - year - 1.8%), and the import volume in September is 102 tons (year - on - year - 10%, month - on - month + 8%). The export volumes in October and November are expected to be 110 and 116 tons respectively [41]. - **PP**: From January to September 2025, the cumulative import volume is 246 tons (year - on - year - 9%), and the import volume in September is 29 tons (year - on - year - 3%, month - on - month + 17%). The cumulative export volume is 234 tons (year - on - year + 28%), and the export volume in September is 24 tons (year - on - year + 22%, month - on - month - 14%) [49][52]. 3.5 Demand - **PE**: This week, the downstream capacity utilization rate of PE is 45%, showing a continuous two - week decline. From January to September 2025, the apparent consumption of PE is 3358 tons (cumulative year - on - year + 11%) [55]. - **PP**: This week, the downstream start - up rate of PP is 53%, showing a continuous three - week increase. From January to September 2025, the apparent consumption of PP is 2981 tons (year - on - year + 13%), with a year - on - year increase of 12% in September [58]. - **Plastic Products**: From January to September 2025, the cumulative export value of plastic and products is 831 billion US dollars (year - on - year + 1.2%), and the export value in September is 119 billion US dollars (year - on - year + 5.1%) [60]. 3.6 Inventory - **Upstream Inventory**: As of November 7, the polyolefin petrochemical inventory of the two major oil companies is 66.5 tons (month - on - month - 2.5, year - on - year + 1%). This week, the PE enterprise inventory is 49 tons (week - on - week + 7.4), reaching a high level in the same period of previous years, and the PP enterprise inventory is 60 tons (week - on - week + 0.5), showing a slight inventory accumulation [63]. - **Social Inventory**: This week, the PE social inventory is 51 tons (week - on - week - 2), with different performances among varieties. The PP trader inventory is 23 tons (week - on - week + 1.5), remaining at a high level in the same period [66]. 3.7 Strategies - **Plastic**: For the single - side strategy, due to weak fundamentals, hold short positions, and focus on the range of [6700 - 6900] for L2601. For the arbitrage strategy, hold the long LP01 arbitrage. For the hedging strategy, industrial customers can choose the opportunity to sell - hedge [5][7]. - **PP**: For the single - side strategy, due to weak supply and demand, hold short positions, and focus on the range of [6400 - 6600] for PP2601. For the arbitrage strategy, short the MTO (05) profit when the price is high. For the hedging strategy, upstream and traders can sell - hedge when the price is high [10].