1. Report Industry Investment Rating - Not provided in the given content 2. Core Viewpoints - The PE spot market price fluctuated and strengthened. The intraday basis quotation fluctuated and weakened. The basis quotation in North China on Friday was around 05 - 520. The price of polyethylene is expected to be strong and volatile in the short - term, but there is a risk of correction [50]. - Upstream device load reduction has increased, which will have a relatively large impact on the expected output, with some upstream delaying the delivery plan. The spot trading in the middle - stream has slightly deteriorated, and some agents continue to sell off due to poor spot liquidity. The situation of downstream panic - buying has eased, and the inventory has gradually become abundant after the previous stock - replenishment [7]. - Pay attention to the intraday basis trading opportunities, and the 5 - 9 positive spread should temporarily leave the market. Adopt a short - term strong - volatile thinking, but beware of correction risks. Consider buying put options [7]. 3. Summary by Relevant Catalogs 3.1 Recent Market Main Contradictions - The main issue is the impact of geopolitical disturbances on the polyethylene market. The price is in a strong and volatile state, and the upstream production is affected by device load reduction, while the downstream demand has changed after stock - replenishment [1][7] 3.2 Polyethylene Industry Situation 3.2.1 Supply - **Production**: This week's output slightly decreased from 683,200 tons last week to 664,000 tons, a decrease of 19,200 tons. Next week and the week after, it is expected to continue to decrease due to device load reduction [5]. - **Import and Export**: The import volume this week remained at 232,300 tons, the export volume was 25,000 tons, and there was no change compared with last week. In February, the import volume was 1,028,400 tons and the export volume was 81,100 tons [5]. 3.2.2 Demand - **Apparent Demand**: This week's apparent demand increased slightly from 861,900 tons last week to 922,000 tons, an increase of 60,200 tons [5]. - **Downstream**: The downstream panic - buying situation has eased, and the inventory has gradually become abundant after the previous stock - replenishment [7]. 3.2.3 Inventory - **Total Inventory**: This week, there was a small - scale destocking, with the total inventory decreasing from 1,238,300 tons last week to 1,187,600 tons, a decrease of 50,700 tons [5]. - **Upstream Inventory**: The upstream inventory decreased from 575,400 tons last week to 568,300 tons, a decrease of 7,100 tons. Among them, the inventory of Sinopec and PetroChina decreased from 505,000 tons to 502,000 tons, a decrease of 3,000 tons; the coal - chemical industry inventory decreased from 70,400 tons to 66,300 tons, a decrease of 4,100 tons [5]. - **Mid - stream Inventory**: The mid - stream inventory decreased from 662,900 tons last week to 619,300 tons, a decrease of 43,600 tons [5]. 3.2.4 Cost and Profit - **Cost**: The crude oil price increased significantly from $103.14 last week to $108.65, driving the cost to rise significantly. The oil - based PE cost increased from 9,860 yuan/ton to 10,273 yuan/ton. The coal - based PE cost remained unchanged at 6,395 yuan/ton [6]. - **Profit**: The overall profit of the oil - chemical end decreased from - 3,806 yuan/ton to - 4,779 yuan/ton, a decrease of 973 yuan/ton. The profit of coal - based PE decreased from 1,805 yuan/ton to 1,705 yuan/ton, a decrease of 100 yuan/ton. The weighted profit of PE by production capacity decreased from - 2,593 yuan/ton to - 3,429 yuan/ton, a decrease of 836 yuan/ton [6]. 3.2.5 Price Difference - **Basis**: The basis has fluctuated greatly recently. The North China basis decreased from - 170 to - 520, the East China basis decreased from 180 to - 320, and the South China basis decreased from 380 to - 20 [6]. - **Inter - month Spread**: The inter - month spread began to weaken. The 1 - 5 inter - month spread increased from - 550 to - 496, the 5 - 9 inter - month spread decreased from 271 to 214 [6]. - **Variety Spread**: The HD - LL spread in North China decreased from 0 to - 130, and the LD - LL spread in North China decreased from 3,050 to 2,800 [6]. 3.3 Basis and Spread - The basis has shown significant fluctuations. The North China, East China, and South China bases have all weakened. The inter - month spread has also changed, with the 5 - 9 spread showing a downward trend, and the 1 - 5 spread slightly increasing. The variety spreads such as HD - LL and LD - LL have also changed to some extent [6] 3.4 Summary and Outlook - **Short - term Outlook**: The price is expected to be strong and volatile, but there is a risk of correction [7]. - **Strategies**: Pay attention to intraday basis trading opportunities, and the 5 - 9 positive spread should temporarily leave the market. Adopt a short - term strong - volatile thinking, but beware of correction risks. Consider buying put options [7]

Report Industry Investment Rating - No relevant information provided Core Viewpoints - The domestic supply - demand pattern of plastics has improved, and there are still expectations for the chemical industry to fight against involution. The situation in the Middle East boosts the energy - chemical industry. The plastics price is expected to fluctuate strongly in the near future. Attention should be paid to the progress of downstream resumption of production after the festival and the development of the Middle East situation [1] Summary by Directory 1.行情分析 - On March 20, new parking devices such as Zhongsha Petrochemical HDPE and Zhongying Petrochemical HDPE were added, and the plastic operating rate dropped to about 85%, which is at a neutral level [1][4] - As of the week of March 20, the downstream operating rate of PE increased by 3.76 percentage points to 37.59% month - on - month. After the Spring Festival holiday, downstream factories gradually resumed production but did not return to the pre - holiday level, showing a seasonal change [1][4] - After the Spring Festival, petrochemical inventories have been reduced, and currently petrochemical inventories are at a neutral level in the same period in recent years [1][4] - Due to the situation in the Middle East, the crude oil price dropped from a high level. The new production capacities of BASF (Guangdong) FDPE (500,000 tons/year) and Yulong Petrochemical LDPE/EVA (300,000 tons/year) were put into production in January 2026, and there are no plans to put new production capacities into operation in the first quarter [1] - After the Lantern Festival, downstream factories resumed work, and the rigid demand was released intensively. The prices of agricultural films in North, East and South China continued to rise. However, downstream customers showed resistance to high prices and procurement became more cautious, with weak spot transactions [1] 2.期现行情 Futures - The plastic 2605 contract opened lower, reduced positions and fluctuated. The lowest price was 8,542 yuan/ton, the highest price was 8,954 yuan/ton, and it finally closed at 8,818 yuan/ton, above the 60 - day moving average, with a decline of 0.94%. The trading volume decreased by 20,434 lots to 336,310 lots [2] Spot - Most of the PE spot market declined, with the price change ranging from - 300 to + 0 yuan/ton. LLDPE was reported at 8,330 - 8,970 yuan/ton, LDPE at 10,230 - 11,310 yuan/ton, and HDPE at 8,490 - 9,640 yuan/ton [3] 3.基本面跟踪 - Supply: On March 20, new parking devices such as Zhongsha Petrochemical HDPE and Zhongying Petrochemical HDPE were added, and the plastic operating rate dropped to about 85%, at a neutral level [4] - Demand: As of the week of March 20, the downstream operating rate of PE increased by 3.76 percentage points to 37.59% month - on - month. After the Spring Festival holiday, downstream factories gradually resumed production but did not return to the pre - holiday level, showing a seasonal change [4] - Petrochemical inventory: On Friday, the early petrochemical inventory decreased by 30,000 tons to 810,000 tons week - on - week, 10,000 tons higher than the same period in the lunar calendar last year, at a neutral level in the same period in recent years [4] - Raw material: The Brent crude oil 05 contract dropped to $108/barrel. The price of Northeast Asian ethylene increased by $70/ton to $1,350/ton month - on - month, and the price of Southeast Asian ethylene also increased by $70/ton to $1,350/ton month - on - month [4]

Report Industry Investment Rating - Not provided Core Viewpoints - On March 19, 2026, the plastic opening rate dropped to around 87% due to new parking devices, and the domestic supply - demand pattern of plastics improved. However, downstream showed resistance to high prices, and spot transactions were weak. With the high - spirited collective sentiment of chemical products, if the Strait of Hormuz cannot resume navigation, refinery production cuts will increase further. The recent plastic prices are expected to fluctuate strongly. It's necessary to pay attention to the progress of downstream resumption after the festival and the situation in the Middle East [1] Summary by Relevant Catalogs Market Analysis - On March 19, the plastic opening rate dropped to around 87% due to new parking devices like Shanghai Petrochemical's LDPE 2 line. As of the week of March 13, the PE downstream opening rate rose 5.21 percentage points to 33.83% week - on - week. After the Spring Festival, petrochemical inventories decreased, and are currently at a neutral level in the same period in recent years. The attack on Iranian oil and gas facilities caused a sharp rise in crude oil prices. New production capacities of Basf (Guangdong) FDPE and Yulong Petrochemical LDPE/EVA were put into production in January 2026, and there are no new production capacity plans in the first quarter. After the Lantern Festival, downstream factories resumed work, and the prices of agricultural films in North, East and South China continued to rise. Although the domestic supply - demand pattern of plastics improved, downstream showed resistance to high prices, and spot transactions were weak. If the Strait of Hormuz cannot resume navigation, refinery production cuts will increase further, and plastic prices are expected to fluctuate strongly [1] Futures and Spot Market - **Futures**: The plastic 2605 contract opened higher, increased positions and fluctuated upward. The lowest price was 8700 yuan/ton, the highest was 9147 yuan/ton, and it finally closed at 8916 yuan/ton, above the 60 - day moving average, with a gain of 4.49%. The position increased by 12,786 lots to 356,744 lots [2] - **Spot**: Most PE spot markets rose, with price changes ranging from - 100 to + 300 yuan/ton. LLDPE was reported at 8530 - 9170 yuan/ton, LDPE at 10230 - 11260 yuan/ton, and HDPE at 8490 - 9740 yuan/ton [3] Fundamental Tracking - **Supply**: On March 19, new parking devices such as Shanghai Petrochemical's LDPE 2 line led to a drop in the plastic opening rate to around 87%, which is at a neutral level [1][4] - **Demand**: As of the week of March 13, the PE downstream opening rate rose 5.21 percentage points to 33.83% week - on - week. After the Spring Festival, downstream factories resumed work gradually but have not returned to the pre - holiday level, showing seasonal changes [1][4] - **Inventory**: On Thursday, the early petrochemical inventory decreased by 10,000 tons to 840,000 tons week - on - week, 20,000 tons higher than the same period last lunar year, currently at a neutral level in the same period in recent years [4] - **Raw Materials**: The Brent crude oil 05 contract rose above $113 per barrel. The Northeast Asian ethylene price rose $30 per ton to $1280 per ton week - on - week, and the Southeast Asian ethylene price also rose $30 per ton to $1280 per ton week - on - week [4]

1. Report Industry Investment Rating - Not provided in the content 2. Core View of the Report - The current situation in Iran remains turbulent, intensifying the Middle - East conflict, leading to an increase in international oil prices and strong support for chemical products. The market logic of olefins lies in concerns about raw material supply due to geopolitical factors and the expectation of supply - side contraction, which supports olefin prices. However, downstream demand shows a negative feedback, and the basis of polyethylene (PE) and polypropylene (PP) has declined. The strategy suggests cautious bottom - fishing and long - hedging for LLDPE and PP [3]. 3. Summary According to Relevant Catalogs 3.1 Market News and Important Data - **Prices and Basis**: The closing price of the L main contract is 8431 yuan/ton (- 65), and that of the PP main contract is 8628 yuan/ton (- 43). LL North China spot is 8300 yuan/ton (+0), LL East China spot is 8400 yuan/ton (+50), PP East China spot is 8550 yuan/ton (-50). LL North China basis is - 131 yuan/ton (+65), LL East China basis is - 31 yuan/ton (+115), and PP East China basis is - 78 yuan/ton (-7) [1]. - **Upstream Supply**: The PE operating rate is 82.4% (- 4.5%), and the PP operating rate is 70.1% (- 4.4%) [1]. - **Production Profits**: PE oil - based production profit is - 1064.0 yuan/ton (- 437.4), PP oil - based production profit is - 1054.0 yuan/ton (- 437.4), and PDH - based PP production profit is - 1746.2 yuan/ton (- 382.2) [1]. - **Imports and Exports**: LL import profit is - 807.7 yuan/ton (- 200.0), PP import profit is - 1304.6 yuan/ton (- 200.0), and PP export profit is 107.6 US dollars/ton (+25.7) [1]. - **Downstream Demand**: PE downstream film operating rate is 26.8% (+8.0%), PE downstream packaging film operating rate is 43.4% (+3.1%), PP downstream plastic weaving operating rate is 40.5% (+2.9%), and PP downstream BOPP film operating rate is 61.3% (+1.7%) [2]. 3.2 Market Analysis - **PE**: The number of domestic refineries' shutdowns, overhauls, or load - reduction devices has increased, and the expected operating rate will further decline. Imported resources are expected to be weak, and market supply is continuously tightening. On the demand side, the overall downstream operating rate has rebounded, but due to rising raw material costs, the operating rate increase has not met expectations, and the LL basis has declined [3]. - **PP**: The supply - side reduction is more obvious. The preventive load - reduction of upstream production enterprises continues to increase, and the expected overhaul loss in March - April will continue to rise. The demand side has a gradual recovery in downstream operating rates, but due to large PP price fluctuations and downstream cost pressures, downstream procurement is cautious, and the PP basis has also declined [3]. 3.3 Strategy - **Single - side**: Cautiously go long and hedge with LLDPE and PP. - **Inter - period**: None. - **Inter - variety**: None [3]. 3.4 Figures and Their Sources - **Figures in "Polyolefin Basis, Inter - period Structure"**: Include plastic main contract, LL East China basis, polypropylene main contract, PP East China basis, L05 - L09, and PP05 - PP09, with sources mainly from Flush and Steel Union [7][10][12]. - **Figures in "Production Profits and Operating Rates"**: Such as PE production profit (crude oil), PE capacity utilization rate, PP production profit (crude oil), PP production profit (PDH - based), polypropylene capacity utilization rate, PP weekly output, etc., sourced from Steel Union [15][18][21]. - **Figures in "Non - standard Price Differences of Polyolefins"**: HD injection - LL East China, HD blow - molding - LL East China, HD film - LL East China, LD East China - LL, PP low - melt copolymer - drawn wire East China, PP homopolymer injection - drawn wire East China, sourced from Steel Union [30][33][37]. - **Figures in "Import and Export Profits of Polyolefins"**: PE East China import profit and loss, LL US Gulf FOB - China CFR, etc., sourced from Flush and Steel Union [39][40][49]. - **Figures in "Downstream Operating Rates and Downstream Profits of Polyolefins"**: Include agricultural film operating rate, packaging film operating rate, plastic weaving operating rate, BOPP film operating rate, plastic weaving production gross profit, BOPP film production gross profit, etc., sourced from Steel Union and Longzhong [60][61][72]. - **Figures in "Polyolefin Inventories"**: PE oil - based enterprise inventory, PE coal - chemical enterprise inventory, PE social inventory, PE port inventory, PP oil - based enterprise inventory, etc., sourced from Zhuochuang and Steel Union [75][82][83].

Group 1: Report Industry Investment Rating - No relevant content Group 2: Core Viewpoints - On March 18, the change in parking devices was small, and the plastic operating rate remained at around 87.5%, currently at a neutral level. The downstream PE operating rate increased by 5.21 percentage points to 33.83% week-on-week as of the week of March 13. After the Spring Festival holiday, the petrochemical inventory continued to decline, and is currently at a neutral level in the same period in recent years. The cost of crude oil remains high. New production capacities of 500,000 tons/year of BASF (Guangdong) FDPE and 300,000 tons/year of Yulong Petrochemical LDPE/EVA were put into production in January 2026, and there are no plans to put new production capacities into operation in the first quarter. The domestic supply-demand pattern of plastics has improved, and there are still expectations for the chemical industry to counter the involution. The situation in the Middle East boosts the energy and chemical industry. If the Strait of Hormuz cannot resume navigation, the refinery load reduction will further increase. Recently, the plastic price has been oscillating strongly. Attention should be paid to the resumption of production progress of downstream enterprises after the festival and the development of the Middle East situation [1] Group 3: Summary by Related Catalogs Market Analysis - On March 18, the plastic operating rate remained at around 87.5%, at a neutral level. As of the week of March 13, the downstream PE operating rate increased by 5.21 percentage points to 33.83% week-on-week. After the Spring Festival, the petrochemical inventory continued to decline, currently at a neutral level in the same period in recent years. The cost of crude oil remains high. New production capacities were put into production in January 2026, and there are no plans to put new production capacities into operation in the first quarter. The domestic supply-demand pattern of plastics has improved, and there are still expectations for the chemical industry to counter the involution. The situation in the Middle East boosts the energy and chemical industry. The shortage of raw materials has increased the load reduction of olefin plants at home and abroad, and the downstream has a resistance to high prices, with weak spot transactions. Recently, the plastic price has been oscillating strongly [1] Futures and Spot Market Conditions - Futures: The plastic 2605 contract opened lower and then increased positions and oscillated. The lowest price was 8,357 yuan/ton, the highest price was 8,683 yuan/ton, and it finally closed at 8,431 yuan/ton, above the 60-day moving average, with a decline of 0.78%. The position increased by 10,242 lots to 343,958 lots [2] - Spot: The PE spot market showed mixed trends, with price changes ranging from -100 to +50 yuan/ton. LLDPE was reported at 8,280 - 8,970 yuan/ton, LDPE at 10,130 - 11,260 yuan/ton, and HDPE at 8,370 - 9,440 yuan/ton [3] Fundamental Tracking - Supply: On March 18, the change in parking devices was small, and the plastic operating rate remained at around 87.5%, currently at a neutral level [4] - Demand: As of the week of March 13, the downstream PE operating rate increased by 5.21 percentage points to 33.83% week-on-week. After the Spring Festival holiday, the downstream enterprises gradually resumed production but have not returned to the pre-holiday level, showing a seasonal change [4] - Inventory: On Wednesday, the petrochemical early inventory decreased by 15,000 tons to 850,000 tons week-on-week, 35,000 tons higher than the same period last lunar year, currently at a neutral level in the same period in recent years [4] - Raw Materials: The Brent crude oil 05 contract fell below $102/barrel. The Northeast Asian ethylene price increased by $50/ton to $1,250/ton week-on-week, and the Southeast Asian ethylene price also increased by $50/ton to $1,250/ton week-on-week [4]

Trade Balance Summary - Japan's trade balance recorded a surplus of 57.2 billion yen in February, a significant decrease of 89.8% year-on-year, marking a return to surplus after two months [1] - Exports to the United States have decreased for three consecutive months, while exports of electronic components such as chips to Asia have increased [1] Export and Import Data - February exports increased by 4.2% year-on-year, reaching a record high of 9.5715 trillion yen, marking six consecutive months of growth [3] - Imports rose by 10.2% year-on-year to 9.5143 trillion yen, with crude oil imports decreasing by 4.2% to 756.3 billion yen [3] - The average price of crude oil in USD was $65.7 per barrel, down 18.3% year-on-year, with a similar decline in yen terms [3] Country-Specific Trade Analysis - Exports to the United States amounted to 1.7528 trillion yen, a decrease of 8.0% year-on-year, influenced by tariff policies from the Trump administration, particularly affecting automobile exports which fell by 14.8% to 470.6 billion yen [3] - The average unit price of exported vehicles decreased by 10.6% to 4 million yen, continuing a 12-month decline [3] - Exports to China decreased by 10.9% to 1.3696 trillion yen, marking a decline after three months, with reductions in semiconductor manufacturing equipment and plastics [3] - Imports from China surged by 35.4% to 2.3368 trillion yen, influenced by differences in holiday schedules affecting logistics and factory operations [3]

Report Industry Investment Rating - Not provided Core Viewpoints of the Report - The domestic supply - demand pattern of plastics has improved, and there are still expectations for the chemical industry to counter the involution. The situation in the Middle East boosts the energy - chemical industry. If the Strait of Hormuz cannot resume navigation, the refinery load reduction will further increase, and the plastic price is likely to rise rather than fall in the near future. Pay attention to the progress of downstream resumption after the festival and the situation in the Middle East [1] Summary by Relevant Catalogs Market Analysis - On March 17, the change of parking devices was small, and the plastic operating rate remained at around 87.5%, at a neutral level. As of the week of March 13, the downstream operating rate of PE increased by 5.21 percentage points to 33.83% week - on - week. After the Spring Festival, the petrochemical inventory continued to be destocked and is currently at a neutral level in the same period in recent years. The cost of crude oil rebounded. The new production capacities of BASF (Guangdong) FDPE and Yulong Petrochemical LDPE/EVA have been put into operation in January 2026, and no new production capacity is planned to be put into operation in the first quarter. After the Lantern Festival, the downstream factories resumed work, and the rigid demand was released intensively. The domestic supply - demand pattern of plastics has improved, but the downstream has a resistance to high prices, and the spot trading is weak [1] Futures and Spot Market Conditions - Futures: The plastic 2605 contract opened lower, reduced positions and fluctuated. The lowest price was 8340 yuan/ton, the highest price was 8616 yuan/ton, and it finally closed at 8496 yuan/ton, above the 60 - day moving average, with a decline of 1.58%. The position decreased by 11231 lots to 333716 lots [2] - Spot: The PE spot market showed mixed trends, with the increase or decrease ranging from - 200 to + 200 yuan/ton. LLDPE was reported at 8370 - 8970 yuan/ton, LDPE at 10550 - 11310 yuan/ton, and HDPE at 8370 - 9490 yuan/ton [3] Fundamental Tracking - Supply: On March 17, the plastic operating rate remained at around 87.5%, at a neutral level [1][4] - Demand: As of the week of March 13, the downstream operating rate of PE increased by 5.21 percentage points to 33.83% week - on - week. The downstream gradually resumed production but has not returned to the pre - festival level, showing a seasonal change [1][4] - Inventory: On Tuesday, the petrochemical early - morning inventory increased by 0.5 tons to 86.5 tons week - on - week, 2 tons higher than the same period of last lunar year, at a neutral level in the same period in recent years [4] - Raw materials: The Brent crude oil 05 contract rose above $103/barrel. The price of Northeast Asian ethylene increased by $50/ton to $1200/ton week - on - week, and the price of Southeast Asian ethylene also increased by $50/ton to $1200/ton week - on - week [4]

Report Industry Investment Rating - Not provided Core View of the Report - The 2026 government work report's tone for the energy and chemical sector is "green carbon reduction, high - end upgrading, supply guarantee and chain stabilization, and technological breakthrough", which is beneficial to the long - term high - quality development of the industry. The impact on futures varieties is mainly "long - term trend guidance", and short - term catalysts need to be comprehensively judged in combination with industry supply - demand, geopolitics, and cost factors [3] Summary by Directory Polyester Sector - The policy aims to curb inefficient expansion through capacity regulation and standard - setting, which helps relieve the over - capacity pressure in PTA, ethylene glycol, and bottle chip sectors and promotes industry supply - demand re - balance - Green transformation is a hard constraint. The goal of reducing carbon dioxide emissions per unit of GDP by about 3.8% and the implementation of the dual - control system for carbon emissions will increase energy and environmental protection costs, accelerating the elimination of backward production capacity and highlighting the competitive advantages of leading enterprises - The policy of expanding domestic demand is expected to boost textile and clothing consumption, indirectly driving the terminal demand for polyester and promoting the healthy development of the industry. The industry profit is expected to concentrate on integrated and low - energy - consumption leading enterprises [5] Plastic Sector PVC - The core goal of "stabilizing the real estate market" and the "trinity" policy of "controlling new construction, reducing inventory, and optimizing supply" are expected to promote the stabilization and improvement of the real estate industry and boost domestic demand. The supply - side policy of "rectifying 'involution - style' competition" will accelerate the exit of high - cost and high - energy - consumption old production capacity, improving the industry's supply - demand imbalance [6] Polyolefins - The policy of "comprehensively rectifying involution - style competition" resonates with the slowdown of new capacity expansion. In 2026, the expansion speed of domestic polyethylene and polypropylene is expected to drop to about 7% and 5% respectively, and new installations are mostly concentrated in leading enterprises, effectively curbing the disorderly investment of small and medium - sized capacities - The policy of "boosting consumption" is a key variable. The demand for polyolefins from the automotive and home appliance sectors is expected to exceed expectations. The market logic will shift from "oversupply" to "supply - demand re - balance under weak recovery". The market may see inventory reduction and a moderate increase in the price center in the second - quarter maintenance season, showing a step - by - step upward trend [6][7] Rubber Sector Short - term - As the core raw material for synthetic rubber, butadiene benefits from the "oil - to - chemical conversion" and "high - end transformation" policies. The domestic butadiene plant operating rate remains high, with volatile costs and gradually recovering downstream demand. The butadiene futures are expected to show a "volatile and slightly stronger" pattern, and factors such as plant maintenance plans, downstream demand recovery, and crude oil price fluctuations should be tracked [8] Long - term - The "high - end transformation" will drive the long - term demand growth of butadiene. The stability of raw material supply will be enhanced, and the butadiene futures are expected to show an "upward - trending" pattern. Key factors to track include the growth of downstream high - end product demand, the progress of industrial green transformation, and the raw material supply pattern [9][12] Styrene - The supply - demand pattern of styrene has changed significantly. The slowdown of capacity growth and the structural shortage of upstream pure benzene have overlapped. The new production capacity growth rate has dropped to about 5%, and the supply of pure benzene has almost stagnated - The downstream demand shows unexpected resilience under the "boosting consumption" policy. The ABS and PS industries' high operating rates provide rigid demand support. The styrene market will focus on "low supply elasticity" and "strong cost support". The price is expected to remain in a relatively high - level and narrow - range volatile state [13][14]

Report Summary 1. Report Industry Investment Rating No information provided. 2. Core Viewpoints - The geopolitical situation remains unrelieved, with shipping stagnant in the Strait of Hormuz, affecting the logistics of oil tankers. Naphtha is expected to be strong, leading to an increase in PE costs. There is an expected improvement in the demand for mulch film after the festival, and the packaging film industry will gradually recover after the Lantern Festival. On the supply side, BASF Zhanjiang has achieved mass production, and the planned maintenance and production cuts are expected to increase in March. The production of standard products remains stable, but the inventory accumulation during the festival is significant. Attention should be paid to the persistence of the geopolitical situation and the willingness to restock during the peak season [3]. - For PP, C3 is affected by supply disruptions from Saudi Arabia and Iran, with strong cost support, and the PDH maintenance rate remains high. There is no new production before the 2605 contract, intensifying the game between existing supply and demand. After the Lantern Festival, downstream enterprises are expected to resume work intensively, with a month - on - month improvement in demand. The PDH profit remains at a low level, and multiple PDH plants in South China have not resumed operation. Under the deep - loss situation of PDH profit, attention should be paid to the marginal changes of cracking and PDH plants [3]. 3. Summary by Relevant Catalogs 3.1 Fundamentals Tracking - **Futures Data**: For L2605, the closing price yesterday was 8416, with a daily increase of 2.19%, trading volume of 1392919, and a change in open interest of 15415. For PP2605, the closing price was 8603, with a daily increase of 3.61%, trading volume of 1568850, and a change in open interest of 9927. The 05 - contract basis for L2605 was - 166 (previous day: - 86), and for PP2605 was - 103 (previous day: - 3). The 05 - 09 contract spread for L2605 was 271 (previous day: 302), and for PP2605 was 535 (previous day: 552) [2]. - **Spot Price**: In the North China region, the LLDPE spot price was 8250 yuan/ton (previous day: 8150), and PP was 8400 yuan/ton (previous day: 8300). In the East China region, LLDPE was 8400 yuan/ton (previous day: 8180), and PP was 8500 yuan/ton (previous day: 8300). In the South China region, LLDPE was 8400 yuan/ton (unchanged), and PP was 8400 yuan/ton (previous day: 8300) [2]. 3.2 Spot News - The weekly operating rate of PE and PP decreased by 3 - 5%. Plants such as CNOOC Shell, Sinochem Quanzhou, and Tianjin Bohua stopped production during the week. In terms of profits, domestic derivatives generally failed to keep up with the increase in US - dollar - denominated raw material prices, resulting in a significant compression of profits. The spot sentiment declined, with tight capital occupation in the middle - stream, and downstream enterprises resisted high prices. The trading atmosphere weakened significantly in the second half of the week. Downstream product quotations were difficult to pass on raw material costs, and some enterprises considered temporary production suspension. There was an inversion of domestic and foreign price spreads, and foreign enterprises declared force majeure [2]. 3.3 Market Condition Analysis - **LLDPE**: Geopolitical factors have led to a continuation of the contraction in cracking supply. The cost of PE has increased due to the strong performance of naphtha. There is an expected improvement in demand after the festival, but attention should be paid to the supply situation affected by maintenance and inventory [3]. - **PP**: Multiple raw material supplies are restricted, and the upstream operating rate has contracted. The cost support is strong, and the game between supply and demand is intensifying. Attention should be paid to the marginal changes of cracking and PDH plants under the low - profit situation [3]. 3.4 Trend Intensity - The trend intensity of LLDPE is 1, and that of PP is 1 [5].

1. Report Industry Investment Rating - No information provided in the reports 2. Core Views - The reports mainly focus on the market conditions, important news, logical analysis, and trading strategies of plastic L and PP. The overall view is to provide investment suggestions based on the current market situation and various influencing factors, with many suggestions to hold long positions in the L and PP 2605 contracts [1][2][5] 3. Summary by Directory Market Situation - **L Plastic**: The price of LLDPE market fluctuates, and the trading volume is affected by factors such as factory procurement enthusiasm and petrochemical factory price adjustment. For example, on March 26, the L main 2605 contract closed at 8570 points, up 154 points or 1.83%. The LLDPE market price fell back, and the trading volume was affected by the low enthusiasm of factory procurement [1] - **PP Polypropylene**: The PP market is also affected by factors such as supply - side reduction expectations, cost support, and downstream acceptance of high - priced goods. For example, on March 26, the PP main 2605 contract closed at 8755 points, up 152 points or 1.77%. The domestic PP spot fluctuated slightly, and the downstream acceptance of high - priced goods was weak [1] Important News - **Industry - related**: The ethylene industry has a new round of production capacity expansion during the "14th Five - Year Plan" period. Northeast Asia and North America lead the expansion. By the end of the "14th Five - Year Plan", the global ethylene production capacity will reach 240 million tons per year [6] - **Project - related**: On March 5, 2026, the 100,000 - ton polyvinyl alcohol (PVA) project of Ningxia Shuangying New Material Technology Co., Ltd. started construction, with a total investment of 1 billion yuan and an expected annual output value of 1.5 billion yuan [9] - **Policy - related**: The EU has approved a draft implementation act on the accounting rules for the minimum recycled content of plastic beverage bottles, which will affect the PET recycling industry [55] Logical Analysis - **Economic Indicators**: In December 2025, the cumulative year - on - year growth rate of the total profit of industrial enterprises above designated size was +0.6%, and the increase has narrowed for 3 consecutive months, which is negative for commodities [2] - **Industry - specific Data**: In March, the daily average output of domestic LLDPE decreased to 46,900 tons, with a year - on - year increase of +11.9%, and the growth rate has slowed down for 6 consecutive months, which is positive for L [22] Trading Strategies - **Unilateral**: For the L main 2605 contract, most of the time it is recommended to hold long positions and set stop - loss points. For example, on March 26, it is recommended to hold long positions and set the stop - loss at 8220 points [2] - **Arbitrage**: For the SPC L2605&PP2605 contract, it is often recommended to hold short positions and set stop - loss points. For example, on March 26, it is recommended to hold short positions and set the stop - loss at - 67 points [2] - **Options**: Generally, it is recommended to wait and see [2]