Report Industry Investment Rating - Not provided Core Viewpoints - PP downstream's overall starting rate rose slightly, but the plastic weaving industry's starting rate and orders declined. The PP enterprise's starting rate and standard-grade drawstring production ratio decreased. Petrochemical inventory is at a relatively low level in recent years. Driven by low valuation, cold weather, and the Iran geopolitical situation, the chemical sector's sentiment improved, and PP followed the market sentiment to fluctuate strongly in the short term. However, the improvement in the PP supply - demand pattern is limited, and the sustainability of the PP rebound should be treated with caution. It is expected that the L - PP spread will decline [1]. Summary by Relevant Catalogs Market Analysis - As of the week of January 23, the PP downstream starting rate increased by 0.34 percentage points to 52.87% week - on - week, at a neutral level in the same lunar period over the years. The starting rate of plastic weaving, the main downstream of drawstring, decreased by 0.56 percentage points to 42.04% week - on - week, and plastic weaving orders continued to decline slightly, slightly lower than the same period last year. On January 27, new maintenance devices such as the first line of Zhongjing Petrochemical Phase II were added. The PP enterprise's starting rate dropped to about 79.5%, at a relatively low level, and the standard - grade drawstring production ratio dropped to about 27%. Near the end of the month, petrochemical inventory was depleted quickly and is currently at a relatively low level in recent years. Cold weather boosted diesel heating demand, alleviating demand concerns. Coupled with the escalating Iran geopolitical situation, crude oil prices rose. Recently, the number of maintenance devices increased slightly. The price of downstream BOPP film continued to rebound, but as the Spring Festival holiday approached, the starting rate of downstream plastic weaving continued to decline, and new orders were limited. Driven by low valuation, cold weather, and the Iran geopolitical situation, the chemical sector's sentiment improved. PP followed the market sentiment to fluctuate strongly in the short term, but the improvement in the PP supply - demand pattern was limited, spot follow - up was limited, the basis weakened, and the sustainability of the PP rebound should be treated with caution. Due to the new production capacity of plastics being put into operation recently, the starting rate of plastics is higher than that of PP, and the concentrated demand for plastic mulch film has not started yet, so the L - PP spread is expected to decline [1]. Futures and Spot Market Quotes - Futures: The PP2605 contract opened lower and then increased positions and fluctuated. The lowest price was 6,653 yuan/ton, the highest price was 6,728 yuan/ton, and it finally closed at 6,709 yuan/ton, above the 20 - day moving average, with a gain of 0.04%. The open interest increased by 4,800 lots to 525,931 lots [2]. - Spot: Most spot prices of PP in various regions declined. The drawstring was quoted at 6,350 - 6,830 yuan/ton [3]. Fundamental Tracking - Supply: On January 27, new maintenance devices such as the first line of Zhongjing Petrochemical Phase II were added. The PP enterprise's starting rate dropped to about 79.5%, at a relatively low level, and the standard - grade drawstring production ratio dropped to about 27% [4]. - Demand: As of the week of January 23, the PP downstream starting rate increased by 0.34 percentage points to 52.87% week - on - week, at a neutral level in the same lunar period over the years. The starting rate of plastic weaving, the main downstream of drawstring, decreased by 0.56 percentage points to 42.04% week - on - week, and plastic weaving orders continued to decline slightly, slightly lower than the same period last year [4]. - Inventory: On Tuesday, the petrochemical early - morning inventory decreased by 60,000 tons to 490,000 tons week - on - week, 20,000 tons higher than the same period last year. Near the end of the month, petrochemical inventory was depleted quickly and is currently at a relatively low level in recent years [4]. - Raw materials: The Brent crude oil 03 contract dropped to $65/barrel, and the CFR propylene price in China increased by $15/ton to $820/ton week - on - week [4].

Report Summary 1. Report Industry Investment Rating - No investment rating information is provided in the report. 2. Core View of the Report - The domestic PP market has slightly declined, with prices dropping by 10 - 50 yuan/ton. The continuous decline in crude oil prices during the holiday and the low - level oscillation of PP futures have dampened the trading sentiment in the spot market. Traders are still bearish on the future, actively selling goods, and some offer prices have slightly decreased to promote transactions. Downstream demand is weak, and the overall trading atmosphere is average, but low - price transactions in some regions are acceptable. The PP trend strength is 0, indicating a neutral trend [2]. 3. Summary by Relevant Catalogs 3.1 Fundamental Tracking - **Futures Data**: The closing price of PP2509 yesterday was 6995, with a daily decline of 0.95%. The trading volume was 273,032, and the open interest increased by 35,248. The 09 - contract basis was 105 (compared to 129 the previous day), and the 09 - 01 contract spread was 96 (compared to 58 the previous day) [1]. - **Spot Price**: In the North China region, the spot price yesterday was 7040 - 7290 yuan/ton (compared to 7080 - 7300 yuan/ton the previous day); in the East China region, it was 7100 - 7250 yuan/ton (compared to 7170 - 7300 yuan/ton the previous day); in the South China region, it was 7150 - 7360 yuan/ton (compared to 7180 - 7380 yuan/ton the previous day) [1]. 3.2 Spot News - The domestic PP market has slightly declined, with prices dropping by 10 - 50 yuan/ton. The continuous decline in crude oil prices during the holiday and the low - level oscillation of PP futures have dampened the trading sentiment in the spot market. Traders are still bearish on the future, actively selling goods, and some offer prices have slightly decreased to promote transactions. Downstream demand is weak, and the overall trading atmosphere is average, but low - price transactions in some regions are acceptable [2]. 3.3 Trend Intensity - The PP trend strength is 0, indicating a neutral trend. The trend strength ranges from - 2 to 2, with - 2 being the most bearish and 2 being the most bullish [2].