1. Report Industry Investment Rating - Not provided in the document 2. Core Viewpoints of the Report - The market anticipates an escalation of the geopolitical conflict in Venezuela, causing crude oil prices to stop falling and rebound. Polyolefin registered warrants are at a historical high for the same period, suppressing the market, leading to a continuous reverse spread in polyolefin prices. During the seasonal peak season, downstream demand for polyolefins is weaker than in previous years. Against the backdrop of supply - side pressure and lackluster demand, polyolefins follow cost - side fluctuations [17][18]. - The predicted trading range for polyethylene (LL2601) this week is between 7200 - 7500, and for polypropylene (PP2601) is between 7000 - 7300. It is recommended to adopt a wait - and - see strategy [17]. 3. Summaries by Directory 3.1 Weekly Assessment and Strategy Recommendation - **Market Information**: There is an expectation of an escalation in the Venezuela geopolitical conflict, causing crude oil prices to rebound. In terms of valuation, the weekly increase in polyethylene is in the order of cost > futures > spot, while for polypropylene, it is futures > spot > cost. Last week, WTI crude oil rose by 0.39%, Brent crude oil by 1.10%, coal prices by 5.83%, methanol fell by - 2.58%, ethylene by - 3.26%, and propylene by - 3.30%, with propane remaining unchanged at 0.00%. Cost - side support still exists [15]. - **Supply - side**: PE capacity utilization is 80.98%, a - 1.91% week - on - week decrease but a 3.90% year - on - year increase and a - 4.39% decrease compared to the five - year average. PP capacity utilization is 75.30%, a - 2.55% week - on - week decrease, a - 0.66% year - on - year decrease, and an - 8.54% decrease compared to the five - year average. According to the production plan, polypropylene will face significant production pressure in the fourth quarter [15]. - **Import and Export**: In September, domestic PE imports were 1.0222 million tons, a 7.58% month - on - month increase but a - 10.04% year - on - year decrease. In August, PP imports were 177,400 tons, an 11.15% month - on - month increase and a - 6.18% year - on - year decrease. Import profits are decreasing, with a reduction in PE supplies from North America, easing import - side pressure. In September, PE exports were 99,200 tons, a - 14.48% month - on - month decrease but a 63.54% year - on - year increase. In August, PP exports were 208,200 tons, a - 16.82% month - on - month decrease but a 21.14% year - on - year increase. With the start of Christmas stockpiling, PP exports may remain at a high level year - on - year [16]. - **Demand - side**: The downstream operating rate of PE is 45.00%, a 0.18% week - on - week increase and a 0.11% year - on - year increase. The downstream operating rate of PP is 52.00%, a 0.29% week - on - week increase and a 0.37% year - on - year increase. During the seasonal peak season, downstream demand for polyolefins is weaker than in previous years [16]. - **Inventory**: PE production enterprise inventory is 514,600 tons, with a - 2.81% week - on - week reduction and a 2.02% increase compared to the same period last year; PE trader inventory is 50,000 tons, with a - 0.70% week - on - week reduction. PP production enterprise inventory is 638,500 tons, with a - 5.92% week - on - week reduction and a 12.69% increase compared to the same period last year; PP trader inventory is 220,000 tons, with a - 7.80% week - on - week reduction; PP port inventory is 66,800 tons, with a - 1.62% week - on - week reduction. Overall, PP inventory pressure is higher than that of PE [16]. 3.2 Spot and Futures Market - The report presents multiple charts related to the term structure, prices, basis, spreads, trading volume, open interest, and registered warrants of PE and PP, including the term structure of PE and PP, the prices of LLDPE and PP main contracts, the basis of LLDPE and PP main contracts, the 1 - 5 spreads of LLDPE and PP, the open interest of LLDPE and PP active contracts, and the registered warrants of LLDPE and PP contracts. It also mentions that South Korea's ethylene plant clearance policy may boost the long - term strengthening of the LL - PP spread [31][63]. 3.3 Cost - side - The report provides a series of charts showing the prices of various raw materials and related indicators, such as the prices of PE and PP in the spot and futures markets and their costs, WTI crude oil prices, thermal coal prices, naphtha prices, propane prices, gasoline crack spreads, P/N/C prices, LPG registered warrants, domestic LPG spot and futures prices and basis, Saudi CP prices, Far East FEI prices, domestic LPG supply - side composition, China's LPG production, China's crude oil processing volume, China's major refinery capacity utilization rate and gross profit, domestic LPG import dependence, China's LPG import source proportion, South China's LPG import profit, LPG arrival volume, China's LPG import volume, Panama Canal water level, Gatun Lake water level, LPG freight rates from the US and the Middle East to the Far East, LPG refinery and port storage ratios, China's LPG demand proportion, China's LPG chemical demand proportion, China's olefin LPG actual demand, MTBE and PDH production gross profit, capacity utilization rate and output, alkylation oil production gross profit, capacity utilization rate and output, US propane prices, production, inventory, exports, and product supply [73]. 3.4 Polyethylene Supply - side - **Raw Material Composition**: The raw materials for PE production are mainly oil - based (80.00%), followed by light hydrocarbon (12.00%), coal (5.00%), methanol (2.00%), and purchased ethylene (1.00%) [139]. - **Capacity and Production**: The report shows the annual changes in PE capacity, production, and capacity growth rate. In 2025, a total of 463 tons of polyethylene production capacity has been put into operation, with 40 tons yet to be put into operation [143][145]. - **Capacity Utilization and Maintenance**: The current PE capacity utilization rate is 80.98%, with a - 1.91% week - on - week decrease. The report also provides information on PE maintenance plans and the resulting production losses [15][147].

1. Report Industry Investment Rating - No relevant content provided 2. Core View of the Report - Polyolefins rebounded under policy impetus and then traded based on the weak fundamental reality [4] 3. Summary by Relevant Catalogs 3.1 Polyolefin Q3 2025 Review - OPEC+ production increase expectations compressed the cost side, and new PP plant launches led to weak polyolefin performance. Weak basis and high warehouse receipts suppressed the market, but anti - involution expectations drove a rebound in late July [5] 3.2 Polyolefin 01 Contract New Capacity - **PE New Capacity**: Multiple plants were put into operation in 2025, with different expected increments for different contracts. For example, the 05 - contract expected increment was 258, and the 09 - contract expected increment was 210. Some projects were postponed, like Shandong New Era's project to Q1 2026 [7] - **PP New Capacity**: Many plants were also put into operation in 2025. The 05 - contract expected increment was 418, and the 09 - contract expected increment was 208. Attention should be paid to the 400,000 - ton new capacity of Guangxi Petrochemical [7] 3.3 PE Price Data - **Quarterly Data**: From August 1 to September 26, 2025, prices of various PE products changed. For example, linear North China prices decreased by 100 - 120, and upstream prices and profit margins also had corresponding changes [9] - **Weekly Data**: From September 19 to 26, 2025, prices and related indicators such as basis, monthly spreads, and profit margins of PE also changed [11] 3.4 PP Price Data - **Quarterly Data**: From August 1 to September 26, 2025, prices of PP products like拉丝 decreased, and basis, monthly spreads, and profit margins also changed significantly [13] - **Weekly Data**: From September 19 to 26, 2025, PP prices and related indicators showed certain fluctuations [15] 3.5 Olefin Spreads - **Basis**: The basis was weak, reflecting relatively large spot pressure [16][17] - **Monthly Spreads**: Monthly spreads showed weak oscillations [22] - **Non - standard Ratios**: The HD - LL spread weakened, and when HD injection - LL > 300, the probability of FD switching to HD production increased [29] 3.6 PE Supply - Maintenance gradually returned, and production and capacity utilization showed corresponding trends [36] 3.7 PP Supply - Recently, there were more unplanned maintenance, leading to a slight decline in production [43] 3.8 PE Profit - The weighted profit weakened [56] 3.9 PP Profit - The valuation was low [63] 3.10 PE Inventory - Inventory was being reduced [70] 3.11 PP Inventory - Upstream inventory was significantly reduced [77] 3.12 Inventory Warehouse Receipts - Warehouse receipt registration volume was at a high level year - on - year, and high warehouse receipts and a continuously weak basis reflected large spot pressure [84][85] 3.13 Global Spreads - The global ratio was low. China's PE ratio weakened, and PP exports declined [88][89] 3.14 Imports and Exports - **PE**: In 2025, the cumulative import volume was 8.0314 million tons, a year - on - year increase of 2.48%. July imports were expected to be low. - **PP**: The import volume in a certain period was 282,400 tons, a month - on - month increase of 16.07%. Imports from September to October were expected to rise slightly [96] 3.15 PE Demand - Demand seasonally recovered but was weak year - on - year. Raw material inventory days were lower year - on - year [97][104] 3.16 PP Demand - Downstream demand was differentiated, with modified PP demand slightly increasing due to auto and home appliance policies. However, peak - season stocking did not show significant growth [111][118] 3.17 Downstream Profits - Downstream profits were recovering, and the year - on - year profit was neutral [126] 3.18 Downstream Demand - The Q2 total retail sales of consumer goods increased by 5.4% year - on - year, accelerating from Q1. In June, the plastics product export value increased by 7.2% year - on - year [133] 3.19 New Capacity Tracking - **PE New Capacity**: ExxonMobil's 500,000 - ton/year LDPE plant was planned to be put into operation in September, and Guangxi Petrochemical was planned to start trial operation in September and be officially put into operation in mid - October. Shandong New Era was expected to start in Q1 2026 [143] - **PP New Capacity**: Daxie Petrochemical's second - phase 2 was expected to be put into operation in mid - September, and other plants also had their respective schedules [145]

Report Information - Report Title: Polyolefin Daily Report [1] - Date: May 21, 2025 [2] Core Viewpoint - On May 20, 2025, the main contracts of plastic and PP in the futures market closed down. The supply side has short - term pressure due to intensive upstream petrochemical maintenance, and the demand side has weak downstream indicators. Although there may be some improvement in demand, the polyolefin market is mainly digesting the previous gains [5][7]. Market Quotes Futures Market - L2509 of plastics opened low, fluctuated downward during the session, and closed down at 7222 yuan/ton, down 24 yuan/ton (-0.33%), with a trading volume of 310,000 lots, and the open interest decreased by 2,179 to 511,907 lots. PP2509 closed at 7047 yuan/ton, down 46 yuan (-0.65%), and the open interest increased by 12,000 lots to 426,777 lots [5][7]. - Other contracts such as plastic 2601, 2605, PP2601, and PP2605 also showed different degrees of decline [7]. Spot Market - The domestic PP market continued to operate weakly, with a decline of 10 - 30 yuan/ton. The PE market price continued to decline slightly, with different price changes in different regions and varieties [7]. Supply and Demand Analysis Supply Side - Upstream petrochemical maintenance is intensive, and the short - term supply pressure is obvious. The maintenance loss is at a high level compared with the same period. PE plans to add 700,000 tons of production capacity from May to June, and the supply pressure will be realized in the third quarter. PP has no production plan in May, and attention should be paid to the commissioning of Sinopec Zhenhai Refining and Chemical's plant in June [5]. Demand Side - The demand for agricultural films has changed from strong to weak, and the operating loads of packaging, film, injection molding, etc. have decreased month - on - month. The indicators of PP downstream fields are weaker than those of the same period last year. Some enterprises that suspended production due to high tariffs have resumed operation, and the phenomenon of rush - export within the 90 - day buffer period may drive the demand to improve [5]. Future Outlook - As the macro - sentiment fades, plastics and PP have risen and then fallen back. There is still pressure in the upper gap. Although the spot atmosphere has warmed up, the actual high - price transactions are limited. The improvement of orders from downstream product manufacturers remains to be seen, and polyolefins are mainly digesting the previous gains [5].