1. Report Industry Investment Rating No information provided in the report. 2. Core Views of the Report - The current core contradictions affecting the propylene trend include weak overall chemical sentiment, individual device fluctuations affecting spot prices, sufficient supply of major downstream PP, and strong cost - side propane. The propylene 03 contract is expected to oscillate between 5700 - 6200 yuan/ton. Short - term "anti - involution" and high - energy - consumption control may drive the disk valuation to repair periodically [1][2]. - The near - end trading is affected by the loose fundamentals and the weak PP trend. The far - end trading faces supply - side production expectations, insufficient PP terminal demand, and cost - side supply pressure [5][10]. - The market is in an oscillatory and weak state. Short - term small rebounds may occur under the influence of "anti - involution" and high - energy - consumption control. Attention should be paid to policy implementation and PDH - end maintenance [17]. 3. Summary by Directory 3.1 Core Contradictions and Strategy Recommendations 3.1.1 Core Contradictions - Chemical sentiment was weak this week, but there was a low - level rebound on Friday night due to "anti - involution" and high - energy - consumption project control. Spot prices are easily affected by individual device fluctuations, with the basis strengthening significantly. The supply - demand difference has not changed much, with some devices under maintenance and some restarting. The downstream PP supply is sufficient, and the price difference with propylene has shrunk significantly, suppressing the propylene price. The PDH cost is high, and the profit is in a continuous loss state, with rumors of some PDH maintenance [1][2]. 3.1.2 Trading - Type Strategy Recommendations - **Market Positioning**: Oscillatory and weak, with the PL03 price range at 5700 - 6200 yuan/ton. - **Unilateral Strategy**: Overall oscillatory and weak, with possible short - term small rebounds under the influence of "anti - involution" and high - energy - consumption control. Attention should be paid to policy implementation and PDH - end maintenance [17]. - **Basis, Calendar Spread, and Hedging Arbitrage Strategy Recommendations** - **Basis Strategy**: Oscillatory contraction. The basis may shrink from a high level next week [18]. - **Calendar Spread Strategy**: Go short on the far - month contract when the spread is high. High - energy - consumption control has a greater impact on the far - month contract [19]. - **Hedging Arbitrage Strategy**: Expand the PP - PL spread when it is low and wait and see; expand the PL/PG ratio and wait and see [19]. 3.1.3 Industrial Customer Operation Recommendations - **Price Range Forecast**: The propylene price is expected to be between 5700 - 6200 yuan/ton, with a current volatility of 0.1335 and a historical percentage of 0.7448 over three years [21]. - **Hedging Strategy Table**: For inventory management, when the finished - product inventory is high, short - sell propylene futures and sell call options. For procurement management, when the procurement inventory is low, buy propylene futures and sell put options [21]. 3.2 This Week's Important Information and Next Week's Attention Events 3.2.1 This Week's Important Information No specific information provided in the report. 3.2.2 Next Week's Important Events to Follow - On December 16, the US unemployment rate; on December 18, the US CPI year - on - year. - Pay attention to the further implementation of high - energy - consumption project control [25]. 3.3 Disk Interpretation 3.3.1 Price - Volume and Capital Interpretation - **Unilateral Trend and Capital Movement**: Expand the PP05 - PL03 spread and wait and see; conduct a calendar spread trade on PL01 - 03 and consider shorting the far - month contract when the spread is high. "Anti - involution" and high - energy - consumption control have a greater impact on the far - month contract [24]. - **Basis and Calendar Spread Structure**: This week, the propylene 03 basis was 300 yuan/ton, an increase of 128 yuan/ton from last week. The propylene 01 - 03 calendar spread was 286 yuan/ton, an increase of 160 yuan/ton from last week [28]. 3.4 Valuation and Profit Analysis 3.4.1 Upstream Profit This week, the gross profit of major refineries was 645 yuan/ton (+52), and the gross profit of Shandong local refineries was 443 yuan/ton (-12). The cracking end had a slight increase in operation after the resumption of production at Guangzhou Petrochemical [30]. 3.4.2 Mid - Stream Profit The propane cracking profit declined significantly, and the LPG cracking economy decreased. The PDH profit based on FEI was - 237 yuan/ton (+109), and the PDH profit based on CP was - 553 yuan/ton (+16). PDH remained in a loss state [32]. 3.4.3 Downstream Profit The price difference between PP拉丝 and propylene was - 40 yuan/ton (-140), and the price difference between PP powder and propylene was - 90 yuan/ton (-150). The epoxy propane chlorohydrin method profit was 436 yuan/ton (+257), the acrylonitrile profit was - 1438 yuan/ton (-248), the acrylic acid profit was - 142 yuan/ton (-64), the butanol profit was +141 yuan/ton (-40), the octanol profit was +563 yuan/ton (-139), and the phenol - acetone profit was - 947 yuan/ton (+42). Currently, PO and butanol - octanol have slight profits, while others are mostly in a loss state [35][36]. 3.4.4 Import - Export Profit Tracking The Sino - Korean propylene price difference has increased slightly recently, with CFR China at 745 US dollars (+0) [45]. 3.5 Supply - Demand and Inventory Deduction 3.5.1 Shandong Market Supply - Demand Balance Sheet Deduction This week, the supply in the Shandong market increased and the demand decreased slightly, and the spot price remained stable. The supply increase mainly came from the resumption of PDH production, and the demand decrease came from the fluctuations in the PO end [47]. 3.5.2 Market Supply - Side and Deduction This week, there were both start - ups and shutdowns. The overall propylene operating rate was 74.21% (+0.15%), still at a high level [50]. 3.5.3 Demand - Side and Deduction - **PP**: This week, the price difference between PP granules and powder and propylene continued to shrink, but the granule - end operation remained stable. The powder - end price difference with propylene was compressed to a low level, and maintenance increased [63][69]. - **Epoxy Propane**: This week, the epoxy propane price declined, the chlorohydrin method profit decreased, but the inventory was still being depleted. The overall operation increased slightly [70]. - **Acrylonitrile**: There was little change [72]. - **Butanol - Octanol**: Ningxia Jiuhong restarted and increased production. Tianjin Bohua's 450,000 - ton unit is expected to start operation at the end of December; Jiangsu Huachang's 140,000 - ton unit is expected to start operation in mid - to late December [75][77]. - **Acrylic Acid**: Shanghai Huayi slightly reduced production, Wanhua slightly increased production, Binhai Chemical was under maintenance, and Qixiang Tengda restarted recently [82]. - **Phenol - Acetone**: Shiyou Chemical and Zhejiang Petrochemical Phase II were under maintenance; Sinopec Mitsui reduced production [84]. - **Shandong Regional Demand**: The demand in the Shandong region increased this week, mainly due to the resumption and production increase of PP, PO, acrylonitrile, and octanol [85].