证券日报网2月26日讯 ，华谊集团在接受调研者提问时表示，主要厂区或项目设计产能包括安徽基地甲 醇、醋酸分别为66万吨和60万吨；漕泾丙烯酸32万吨；轮胎基地分布于安徽、江苏、重庆、新疆、泰国 等地区，近年增加了乘用胎产能；广西新材料丙烯75万吨、双酚A20万吨等。新增产能项目包括工业气 体公司合成气供应及配套项目、广西新材料32万吨/年丁辛醇及丙烯酸酯项目等。10万吨/年绿色甲醇项 目已于2025年12月举行投产仪式，由公司建设运营，和申能、上港、城投强强联合打造，为上海国际航 运中心建设与绿色低碳转型注入强劲动力。 （文章来源：证券日报） ...

Core Insights - Hebei Province has announced a list of key construction projects for 2026, focusing on strategic emerging industries, traditional industry upgrades, modern services, and infrastructure [1] - A total of 747 key projects are planned with a total investment of 1.56 trillion yuan, an increase of 44 projects compared to the previous year [1] Group 1: New Projects - The new projects include a 40,000-ton annual production project for benzaldehyde and related products by Hebei Jindong New Materials [1] - Hebei Siyou Shucan's 300,000-ton α-olefin project is set to be developed in the Bohai New Area [1] - A 33,83-ton high-purity hydrogen sulfide production project by China Shipbuilding (Handan) is planned [1] - North China Petrochemical will initiate a 100,000-ton annual sustainable aviation fuel project [1] - A 200,000-ton annual carbon capture and utilization project is also planned by North China Petrochemical [1] Group 2: Ongoing Projects - The ongoing projects include a 400,000-ton annual sustainable aviation fuel hydrogenation project by Zhongneng Yida [2] - A 50,000-ton straw biomass fuel project by Langfang Qida is under development [2] - Hebei Dexin Hydrogen Energy Technology's comprehensive utilization project for coke oven gas is also in progress [2] - A 12 billion square meters wet-process lithium battery separator project by Cangzhou Mingzhu is ongoing [2] - The green transformation development project by Sinopec's Shijiazhuang Refining and Chemical Company is also part of the ongoing projects [2]

Core Viewpoint - The company is committed to implementing national strategies and focusing on high-quality development, with a strong emphasis on new productive forces and a diversified industrial system covering clean energy, semiconductor display materials, and life sciences [2] Group 1: Clean Energy - The subsidiary Nanjing Chengzhi is a leading operator in the domestic clean energy sector, specializing in the production and operation of industrial gases such as hydrogen, carbon monoxide, and synthesis gas [2] - The company also produces chemical products like methanol, ethylene, propylene, and butanol, leveraging the geographical advantages of the Qingdao Dongjiakou Chemical Park to extend its reach into the downstream new materials sector [2] - Continuous efforts are being made to adjust and upgrade the structure of the clean energy business [2] Group 2: Semiconductor Display Materials - The subsidiary Shijiazhuang Chengzhi Yonghua is the first domestic manufacturer to independently develop liquid crystal materials, with products spanning monochrome liquid crystal materials, TFT-LCD liquid crystal materials, and OLED materials [2] - The company is expanding from a focus on liquid crystal materials to broader display industry applications [2] Group 3: Life Sciences - The company is dedicated to research and development in high-tech products within the biotechnology sector, focusing on product innovation and market expansion [2] - Key products include D-ribose, D-mannose, and nutritional supplements like Libos [2]

Core Viewpoint - The environmental impact report for the high-end chemical project by Xinpu Chemical (Taixing) Co., Ltd. has been approved, indicating a significant investment in the chemical industry in Taizhou [1] Investment Details - The total investment for the project is 718.732 million yuan, with 54.53 million yuan allocated for environmental protection, representing 0.76% of the total investment [1] Project Specifications - The project includes the construction of a 62,400 Nm3/h syngas unit, a 500,000 tons/year butanol unit, a 400,000 tons/year polypropylene unit, a 16,000 Nm3/h gas separation unit, and a 200,000 cubic meter ethane tank, along with other supporting facilities [1] Production Capacity - Upon completion, the project is expected to produce 323,000 tons of syngas, 1,840 tons of hydrogen, 413,240 tons of n-butyraldehyde, 236,000 tons of n-butanol, 90,000 tons of isobutyraldehyde, 150,000 tons of isooctanol, 205,300 tons of oxygen, 433,600 tons of nitrogen, 9,400 tons of liquid argon, and 400,000 tons of polypropylene annually [1]

Group 1: Investment Rating - No investment rating for the industry is provided in the report. Group 2: Core Views - Since the listing of propylene futures on July 22, the price of the main contract has shown an overall downward trend, affected by factors such as a loose fundamental situation, weakened cost support, and sluggish downstream demand [1][7]. - In 2026, it is necessary to focus on the production progress of the industrial chain, the PDH's phased adjustment of the supply - demand balance, the slow - down of PP growth but persistent pressure, and changes in the import - export pattern [1][2]. - The expected price range of propylene in 2026 is between 5,400 - 6,400 yuan/ton [3]. - Recommended strategies include unilateral interval operations and variety - based interval operations such as PP - PL and PL/PG (FEI/CP) [3]. Group 3: Summary by Directory Chapter 2: Market Review - After the listing of propylene futures on July 22, the main contract price declined from a high of 6,694 yuan/ton to a low of 5,715 yuan/ton, driven by factors such as a shift to a loose fundamental situation, weakened cost support, and sluggish downstream PP demand [7]. - There were also some phased disturbance factors during the decline, including the "anti - involution" policy expectation and unstable device operations [7][8]. - The propylene basis fluctuated between - 250 and 250 yuan/ton. The futures price was affected by fundamental over - supply pressure and the weakening of the PP end, while the spot price was more sensitive to device changes [10]. - The spot price difference between propylene and polypropylene (PP) fluctuated significantly, while the futures price difference had a relatively narrow range. The PP - PL spread showed different trends at different times due to factors such as device maintenance and new capacity addition [12]. Chapter 3: Core Focus Points - **3.1 Production Growth Slowdown**: From 2019 - 2025, the cumulative new propylene production capacity was about 45.87 million tons, with an average annual compound growth rate of 13%. As of now in 2025, the newly put - into - operation capacity is about 9.93 million tons, a 14.24% increase from 2024. In 2026, the planned new capacity is about 6 - 8 million tons, with a growth rate of 7.5% - 10%. The upstream - downstream integration trend is significant, and the actual supply - demand difference is also related to the start - up situation of upstream and downstream [14][16][18]. - **3.2 PDH's Phased Adjustment of Supply - Demand Balance**: PDH and refinery catalytic cracking devices have a greater impact on the propylene trading market. In 2025, the overall PDH operating rate was around 71%, with profit being the core driving factor. In 2026, low profit may become the norm, and some enterprises under greater operating pressure may arrange maintenance. Attention should be paid to enterprises with frequent start - stop operations and those that can significantly affect regional prices [20][21][23]. - **3.3 PP Growth Slowdown but Persistent Pressure**: The price of the propylene main contract is highly correlated with the PP futures price. In 2025, the total production capacity of polypropylene powder and granules reached 57.85 million tons, with a growth rate of 10.82%. In 2026, the planned new production capacity is 3.6 - 4.4 million tons, mainly concentrated in the second half of the year. Attention should be paid to the production rhythm, maintenance, and capacity clearance on the supply side, as well as domestic demand resilience and export increments on the demand side [25]. - **3.4 Import - Export Pattern Changes**: China is still a net importer of propylene. In January - October 2025, 1.83 million tons were imported, with 1.25 million tons from South Korea, accounting for 68.31% of the total imports. South Korea plans to restructure its petrochemical business, which may lead to a reduction in China's propylene imports from South Korea and have a positive impact on the domestic supply - demand and price [30][31][33]. Chapter 3 (Continued) - **3.1 Valuation Feedback**: PDH profit has room for repair. In the fourth quarter of 2025, the PDH profit space was significantly compressed. After the new year, some enterprises may arrange maintenance, and the PDH profit is expected to recover to some extent. The PP - PL spread is oscillating at a low level, and there may be some room for expansion in the future if PP device maintenance increases [36][38]. - **3.2 Supply - Demand Outlook**: From January - November 2025, the domestic propylene production was 55.35 million tons, a 13.82% year - on - year increase, with an average operating rate of 74%. In 2026, the production is expected to remain high, and the supply will remain loose. The demand side is affected by the over - supply pressure of PP and other downstream industries, and the over - supply pressure will increase with new capacity addition [40][42]. - **Shandong Market Balance**: The supply in the Shandong market is mainly affected by PDH and refinery catalytic cracking, with PDH having greater fluctuations. The demand is mainly affected by PP and PO. In 2026, attention should be paid to the operation of existing capacities on the supply side and the start - up of new downstream devices on the demand side [45][46].

Report Industry Investment Rating No relevant content provided. Core Viewpoints of the Report - The propylene 03 contract is expected to fluctuate in the range of 5,500 - 6,000 yuan/ton in the short term. The recent weakening of the futures market, while the spot market remains stable, is mainly due to the loose supply - demand of propylene itself and the continuous suppression from the PP end. Short - term policy news may drive valuation repair, but the sustainability of the rebound depends on the actual improvement of the fundamentals [2]. - The near - term trading is affected by the overall loose fundamentals and the weak PP trend. The long - term outlook is bearish due to expected new production capacity, the imbalance between PP terminal demand and supply growth, and cost - side pressure [5][10]. Summary by Relevant Catalogs Chapter 1: Core Contradictions and Strategy Recommendations 1.1 Core Contradictions - Macro - sentiment and policy disturbances: The recent market is influenced by "anti - involution" news, leading to a short - term low - level rebound of some chemical products. The sustainability of the rebound remains to be seen [1]. - Stable spot supply - demand: This week, the overall supply - demand gap changed little. On the supply side, Guangzhou Petrochemical restarted and Jinhai Chemical had maintenance, with little change in overall production and capacity utilization. On the demand side, there was a slight increase. In the Shandong market, supply increased and demand decreased, causing a slight price decline [1]. - Suppression from major downstream PP: PP supply is abundant, and the price spread between PP and propylene has significantly shrunk. The weak PP price continues to suppress the propylene market. Short - term "anti - involution" may cause a phased rebound in the futures market, mainly for sentiment repair [1]. - PDH profit pressure: The price of propane in the international market remains strong. The PDH industry is in a continuous loss state, and attention should be paid to the possible negative feedback caused by profit contraction [2]. 1.2 Trading Strategy Recommendations - **Market positioning**: The market is expected to fluctuate weakly, with the PL03 price range at 5,500 - 6,000 yuan/ton. The overall trend is still weakly fluctuating, and it may rebound slightly due to some macro factors, but the short - term expectation is a weakly fluctuating trend. Follow - up attention should be paid to policy implementation and PDH unit maintenance [15]. - **Basis, calendar spread, and hedging arbitrage strategies**: - Basis strategy: The basis is expected to shrink as the spot price weakened slightly this week while the futures market was fluctuating [16]. - Hedging arbitrage strategy: Consider expanding the PP - PL spread on dips and the PL/PG ratio on dips, but stay on the sidelines for now. Pay attention to PP unit maintenance [17]. 1.3 Industrial Customer Operation Recommendations - Propylene price range forecast: The price of propylene is expected to be in the range of 5,500 - 6,000 yuan/ton. The current 20 - day rolling volatility is 0.1319, and the historical percentage of volatility in the past 3 years is 0.7378 [19]. - Hedging strategies: For enterprises with high finished - product inventory, they can short - sell propylene futures at high prices to lock in profits and sell call options to collect premiums. For enterprises with low procurement inventory, they can buy propylene futures at low prices to lock in procurement costs and sell put options to collect premiums [21]. Chapter 2: This Week's Important Information and Next Week's Key Events 2.1 This Week's Important Information - **Positive information**: Six departments issued a notice to promote the clean and efficient utilization of new and existing coal development projects and eliminate backward production capacity and processes. Geopolitical tensions may support oil prices [22]. - **Negative information**: Some PDH units under maintenance will restart, and the PDH operating rate has returned to a relatively high level of 75%. The PP market remains in a state of high supply [23]. 2.2 Next Week's Key Events - On December 22, China's December LPR will be announced. On December 23, the revised value of the annualized quarterly - on - quarter growth rate of the US real GDP in Q3 will be released [27]. Chapter 3: Futures Market Interpretation 3.1 Price, Volume, and Capital Analysis - **Domestic market**: The PL03 contract fluctuated this week. The net positions of major profitable seats decreased, and there were no obvious changes in the top 5 long and short positions in the order book. The net long positions of profitable seats, foreign investors decreased slightly, and the net short positions of retail investors increased slightly. Technically, the daily - line chart shows a downward trend, suppressed by the middle Bollinger Band. In the short - term, it fluctuated in the range of 5,650 - 5,800 [25]. - **Basis and calendar spread structure**: This week, the basis of propylene 03 was 220 yuan/ton, a decrease of 80 yuan/ton compared with last week. The 02 - 03 calendar spread was 20 yuan/ton, a decrease of 35 yuan/ton compared with last week [29]. Chapter 4: Valuation and Profit Analysis 4.1 Up - and Down - stream Profit Tracking - **Upstream profit**: The gross profit of major refineries this week was 614 yuan/ton (- 31), and that of Shandong local refineries was 472 yuan/ton (+ 29). The operating rate at the cracking end changed little [31]. - **Mid - stream profit**: The propane cracking profit declined significantly, and the profitability of LPG cracking decreased. The PDH profit based on FEI was - 289 yuan/ton (- 46), and that based on CP was - 431 yuan/ton (+ 122). The PDH industry remained in a loss state [32]. - **Down - stream profit**: The price spreads between PP拉丝/PP powder and propylene rebounded slightly. The profit of the chlorohydrin method for propylene oxide decreased. The overall loss of acrylonitrile was still large. The profit of acrylic acid weakened. The profit of butanol was compressed, and the profit of octanol recovered at a low level but was still under pressure. The profit of phenol - acetone weakened [34]. 4.2 Import - Export Profit Tracking - The price spread between China and South Korea for propylene has been stable recently. The CFR China price is 740 US dollars (- 5) [49]. Chapter 5: Supply - Demand and Inventory Projection 5.1 Supply - Demand Balance Sheet Projection in the Shandong Market - This week, supply increased and demand decreased slightly in the Shandong market, and the spot price declined. The increase in supply mainly came from the复产 of PDH units, and the decrease in demand was due to the maintenance of Jineng and Yulong in the PP sector [51]. 5.2 Market Supply and Projection - This week, there were both start - ups and shut - downs. The overall operating rate of propylene was 74.11% (- 0.1%), still at a high level. Guangzhou Petrochemical's 600,000 - ton steam cracking unit restarted, and Jinhai Chemical's 210,000 - ton steam cracking unit was under maintenance [54]. 5.3 Demand and Projection - This week, the price spreads between PP granules/powder and propylene rebounded slightly, and the operating rate of the granule end remained stable. The price spread of PP powder also rebounded slightly but was still at a low level, and the number of maintenance units increased. For other downstream products, the price of propylene oxide declined, the profit of the chlorohydrin method decreased, and the inventory continued to decline. The production of acrylonitrile changed little. The operating rate of butanol and octanol increased. The capacity utilization rate of acrylic acid was at a phased high. The production of phenol - acetone changed due to unit restarts and maintenance. The demand in the Shandong region increased this week, mainly due to the复产 and increased load of PP, PO, acrylonitrile, and octanol [63][78].

Report Information - Report Title: "Profit Rebalancing under Rhythm Game - Outlook for LPG & Propylene Futures Market in 2026" [1] - Report Date: December 18, 2025 - Analysts: Chen Xinchao (Investment Consulting Qualification No.: Z0020238), Zhao Shucen (Contact Person, Futures Practitioner Qualification No.: F03147780) 1. Report Industry Investment Rating - Not provided in the report 2. Core Viewpoints of the Report - The operating logic of the C3 industrial chain is expected to shift from unilateral compression in 2025 to profit repair under range - bound fluctuations in 2026. The propane price center is likely to remain relatively low, providing weak cost - side support for the C3 industrial chain. Meanwhile, with the slowdown of propylene capacity expansion and the continued drive from downstream sectors, the supply - demand outlook for propylene is expected to improve marginally, but attention should be paid to the actual implementation of new plant construction under the low - profit background. The opportunities in the industrial chain mainly lie in periodic repairs rather than a trend reversal [2]. 3. Summary by Directory 3.1. 2025 LPG, Propylene Trend Review 3.1.1 2025 LPG Market Review - The LPG market in 2025 can be divided into four stages: In the first quarter, the domestic civil gas market was in a seasonal peak. The spot price of the lowest deliverable product in the domestic market was around 4,800 - 4,900 CNY/ton, and the market fluctuated widely with costs. From April to May, affected by tariff policies, the external market price of crude oil and FEI market prices plummeted, and then rebounded. The domestic market was weak due to high inventory and low demand. From June to September, with the shift of the import trade center to the Middle East, the supply was stable, but the demand was weak, and the market was under pressure. In the fourth quarter, the CP price dropped, PDH profit was briefly repaired, and the chemical demand increased. The supply - demand situation improved, but the long - term supply was still loose [8][9]. 3.1.2 2025 Propylene Market Review - The propylene market in 2025 also had three stages: In the first quarter, new capacity led to an oversupply situation, and the price declined. From June to August, due to the shutdown of main production plants and maintenance of multiple devices, the supply tightened, and the price rebounded, but the sustainability was limited due to weak downstream demand. In the fourth quarter, the downstream profit was compressed, demand weakened, and the price dropped to a five - year low [11][13][14]. 3.2. 2026 LPG Operating Logic 3.2.1 Supply Side - In 2025, China's LPG imports remained stable, but the import structure changed significantly. After the adjustment of Sino - US tariff policies in April, the import from the Middle East increased, while that from the US decreased. In 2026, the Middle East's LPG supply has an expected increase, with the main increment concentrated in the second half of the year. The US production growth is expected to slow down, but the export capacity will improve [15][18][34]. 3.2.2 Demand Side - The growth of PDH capacity will further slow down in 2026, and the profit is expected to be repaired. The average operating rate of PDH is expected to increase, driving an additional propane demand of about 2 million tons. The demand for imported propane from domestic cracking plants is expected to remain weak. The propane demand in Japan and South Korea is expected to remain stable, and the growth rate of India's propane demand is expected to slow down, while Southeast Asia's demand may continue to be supported by the operation of existing cracking plants [41][44][52]. 3.2.3 LPG Summary - The supply - demand pattern of propane in 2026 shows a characteristic of "tight at the beginning and loose later, gradually becoming looser". In the first quarter, the supply is relatively tight, but better than in the fourth quarter of 2025. In the second quarter, the market is in a transition period. In the second half of the year, with the release of new capacity in the Middle East, the supply - demand pattern will become looser [57]. 3.3. 2026 Propylene Operating Logic 3.3.1 Supply Side - In 2025, the propylene supply expanded rapidly, and the over - supply situation intensified. In 2026, the growth rate of propylene capacity is expected to slow down to about 9%. The new capacity is mainly concentrated in the second half of the year, and most of the new capacity comes from integrated plants. The supply is still expected to be loose, and the focus will shift to the risks of structural and rhythm mismatches [59][67]. 3.3.2 Demand Side - In 2025, the demand for propylene from major downstream sectors increased by 15%. In 2026, the nominal demand growth rate is about 11%, mainly from polypropylene, propylene oxide, and butanol - octanol. However, due to the over - capacity in the downstream and compressed profits, the actual demand may be less than the nominal demand [69][75]. 3.3.3 Propylene Summary - In 2025, the propylene market in Shandong was generally in a state of over - supply, with a brief tightening in the middle of the year. In 2026, the upstream and downstream production schedules of propylene show a structural characteristic of "downstream first, more downstream production throughout the year". Nationally, the supply - demand gap is expected to narrow in the first half of the year, and the overall pattern will remain stable in the second half of the year. In Shandong, the supply - demand situation is expected to improve gradually, with a possible improvement in the second half of the year [87][89]. 3.4. Overall Summary - In 2025, the global propane supply was abundant, and the price decreased. The propylene market was in an over - supply situation, and the C3 industrial chain was under pressure. In 2026, the propane price is expected to stay low, and the supply - demand situation of propylene is expected to improve marginally. The operating logic of the C3 industrial chain is expected to shift from unilateral compression to profit repair under range - bound fluctuations [95][96].

Report Industry Investment Rating No relevant content provided. Core Viewpoints of the Report - The propylene market maintains a loose pattern, with the 03 contract expected to oscillate between 5,700 - 6,200 yuan/ton. The market is affected by a generally loose fundamental situation and the weak trend of PP. Although the supply - demand gap has improved compared to October, enterprise inventories remain high. The continuous decline of PP prices and the significant compression of its price difference with propylene also suppress the propylene market [2][3][5]. Summary by Relevant Catalogs Chapter 1: Core Contradictions and Strategy Recommendations 1.1 Core Contradictions - The "anti - involution" issue may be repeatedly submitted, affecting market expectations, but there is no actual progress. The overall chemical sentiment was weak this week, with prices falling again after a slight rebound last week [2]. - Spot prices are easily affected by individual device fluctuations. Although the supply - demand difference changed little this week, spot prices remained stable due to the postponed restart of some devices. In the Shandong region, Hengtong restarted this week, and Binhua is expected to restart in mid - December, increasing the overall supply expectation [2]. - The main downstream product, PP, has sufficient supply. The price difference between PP and propylene has significantly shrunk recently, with some PP devices entering maintenance, but overall PP operation remains at a high level, providing demand support while also suppressing the propylene market [2]. - The price of external propane at a low level rebounded with crude oil, and the premium has strengthened significantly recently. The calculated cost is around 6,250 - 6,500 yuan/ton, and the PDH profit continues to show losses. Attention should be paid to the negative feedback from the profit, but there are currently no more maintenance plans [2]. 1.2 Trading Strategy Recommendations - **Market Positioning**: The market is expected to be weakly oscillating, with the PL03 price range between 5,700 - 6,200 yuan/ton. The overall trend remains weakly oscillating. In the short term, it gets some support from the significant increase in costs, but the upward potential is limited. The negative feedback from the PDH end should be monitored, and the market is regarded as weak until more negative feedback emerges [16]. - **Basis, Calendar Spread, and Hedge Arbitrage Strategy Recommendations** - **Basis Strategy**: The basis is expected to oscillate. This week, due to the postponed restart of production, spot prices remained stable, while the futures market was affected by the overall chemical sentiment and the weak PP price, causing the basis to strengthen [17]. - **Calendar Spread Strategy**: Consider reverse arbitrage for the 1 - 3 spread when the price is high [17]. - **Hedge Arbitrage Strategy**: Consider widening the PP - PL spread when the price is low and wait and see; consider widening the PL/PG ratio and wait and see. The price difference between PP pellets and propylene is around 100 yuan/ton, and that between PP powder and propylene is around 600 yuan/ton in the spot market, and it has also compressed to around 440 yuan/ton in the futures market. One can enter the market when the price is low and pay attention to the maintenance situation of the PP end [17]. - **Recent Strategy Review** - The strategy of narrowing the PP01 - PL03 spread (take profit) was proposed on November 7 and took profit on November 20. Currently, wait and see for opportunities to enter the market to widen the spread. - Hold the reverse arbitrage of PL01 - 03, which was entered on December 5. Conduct range - bound operations on PL01 - 03, mainly focusing on reverse arbitrage [17]. 1.3 Industrial Customer Operation Recommendations - **Inventory Management**: For enterprises with high finished product inventories worried about propylene price drops, they can short - allocate propylene futures at high prices according to their inventory to lock in profits. Sell PL2603 futures contracts with a hedging ratio of 50% when the price is between 6,100 - 6,200 yuan/ton. They can also sell call options on PL2603C6200 to collect premiums and reduce costs, with a hedging ratio of 25% and a recommended entry range of 80 - 100 [18]. - **Procurement Management**: For enterprises with low regular procurement inventories that hope to purchase according to orders, they can buy propylene futures at low prices to lock in procurement costs. Buy PL2603 futures contracts with a hedging ratio of 25% when the price is between 5,700 - 5,800 yuan/ton. They can also sell put options on PL2603P5700 to collect premiums and reduce procurement costs, with a hedging ratio of 25% and a recommended entry range of 100 - 120 [18]. Chapter 2: This Week's Important Information and Next Week's Attention Events 2.1 This Week's Important Information - **Positive Information** - The Russia - Ukraine peace talks have no results, and there is still some distance from reaching an agreement, causing a slight increase in the crude oil market [23]. - The probability of the Fed cutting interest rates by 25BP in December is 93% according to Polymarket [23]. - Spot prices are relatively stable [23]. - **Negative Information** Some of the currently shut - down PDH devices will gradually restart. If there is no more negative feedback, the supply side will remain loose [20]. 2.2 Next Week's Important Events to Watch - The Politburo meeting and the Central Economic Work Conference will be held [24]. - The US October PCE price index will be released [24]. - The US FOMC interest rate decision will be announced [24]. Chapter 3: Disk Interpretation 3.1 Price - Volume and Capital Interpretation - **Domestic Market** - **Unilateral Trend and Capital Flow**: This week, the PL03 contract oscillated downward. The net positions of major profitable seats increased, the net positions of the top five long - position holders in the dragon - tiger list remained unchanged, the top five short - position holders significantly increased their positions, the net long positions of profitable seats slightly increased, the net long positions of foreign capital slightly decreased, and the net short positions of retail investors slightly increased [22]. - **Technical Analysis**: The PL03 contract was generally weakly oscillating this week. The daily - line middle track still exerted pressure, and currently, there seems to be support around 5,800 yuan/ton [22]. - **Basis and Calendar Spread Structure** - This week, the basis of propylene 03 was 172 yuan/ton, an increase of 112 yuan/ton compared to last week. Spot prices remained stable while futures prices declined. The 01 - 03 calendar spread of propylene was + 126 yuan/ton, an increase of 69 yuan/ton compared to last week [27]. Chapter 4: Valuation and Profit Analysis 4.1 Up - Mid - Downstream Profit Tracking in the Industrial Chain - **Upstream Profit**: This week, the gross profit of major refineries was 593 yuan/ton (- 29 yuan/ton), and that of Shandong local refineries was 232 yuan/ton (+ 59 yuan/ton). The cracking end has been relatively stable recently due to the resumption of production at Zhenhai [29]. - **Mid - stream Profit**: The propane cracking profit has significantly declined, reducing the economic viability of LPG cracking. The PDH profit based on FEI as the cost was - 350 yuan/ton (+ 80 yuan/ton), and that based on CP as the cost was - 505 yuan/ton (+ 47 yuan/ton). The PDH profit remains in a loss state [31]. - **Down - stream Profit** - The price difference between PP拉丝 and propylene is 100 yuan/ton (- 75 yuan/ton), and that between PP powder and propylene is 60 yuan/ton (- 75 yuan/ton), with the spread compressed to a low level [35]. - The profit of epoxy propane PO/SM is 1,365 yuan/ton (+ 126 yuan/ton), the HPPO profit is - 834 yuan/ton (+ 61 yuan/ton), and the chlorohydrin method profit is 178 yuan/ton (- 106 yuan/ton) [35]. - The acrylonitrile profit is - 1,189 yuan/ton (+ 58 yuan/ton), oscillating this week but with large overall losses [35]. - The acrylic acid profit is - 78 yuan/ton (- 18 yuan/ton), with the profit weakening, and attention should be paid to the subsequent operation situation [35]. - The butanol profit is + 182 yuan/ton (+ 657 yuan/ton), with a significant improvement in profit [35]. - The octanol profit is + 702 yuan/ton (+ 607 yuan/ton), with the profit recovering from a low level as the supply decreases [35]. - The phenol - acetone profit is - 990 yuan/ton (- 367 yuan/ton), with the profit weakening. Currently, PO, butanol, and octanol have some profits, while others are mostly in a loss state [35][36]. 4.2 Import - Export Profit Tracking The price difference between Chinese and South Korean propylene has recently increased slightly, with CFR China at 745 US dollars (+ 10 US dollars) [45]. Chapter 5: Supply - Demand and Inventory Deduction 5.1 Supply - Demand Balance Sheet Deduction in the Shandong Market This week, both supply and demand in the Shandong market increased, and spot prices slightly rose. The increase in supply mainly came from the resumption of production at Hengtong, and the increase in demand came from the resumption of production and increased operation of devices such as PO and acrylic acid. In the future, supply will slightly increase with the resumption of production at Binhua [47]. 5.2 Market Supply Side and Deduction This week, there were both start - ups and shut - downs. The overall propylene operation rate was 74.06% (- 0.06%), still at a high level [50]. 5.3 Demand Side and Deduction - **PP**: This week, the price difference between PP pellets and powder and propylene continued to shrink, and the overall operation rate declined, but there were not many maintenance plans. The price difference between PP powder and propylene has compressed to a low level, and maintenance has increased [62][70]. - **Epoxy Propane**: This week, the price of epoxy propane declined, the profit of the chlorohydrin method decreased, but the inventory was still in a destocking state. This week, Shandong Xinyue and Qixiang Tengda increased their operation rates, while Shandong Binhua, Zhonghai Jingxi, and Shandong Minxiang slightly decreased their operation rates, and the overall operation rate slightly increased [71]. - **Acrylonitrile**: There was little change [73]. - **Butanol and Octanol** - Ningxia Jiuhong restarted and increased its operation rate. The 450,000 - ton device of Tianjin Bohua is expected to start operation at the end of December, and the 140,000 - ton device of Jiangsu Huachang is expected to start operation in mid - to - late December [78][80]. - **Acrylic Acid**: Shanghai Huayi slightly decreased its operation rate, Wanhua slightly increased its operation rate, Binhai Chemical stopped for maintenance, and Qixiang Tengda recently restarted [84]. - **Phenol - Acetone**: Taihua Xingye is expected to conduct maintenance for about one and a half months [86]. - **Shandong Regional Demand**: Demand in the Shandong region increased this week. The increase mainly came from the resumption of production and increased operation of PP, PO, acrylonitrile, and octanol [87].

1. Report Industry Investment Rating - The investment rating for the propylene industry in 2026 is "Neutral" for single - side trading [2][11] 2. Core Viewpoints of the Report - In 2026, the fundamental pressure on propylene's market is difficult to change, with prices expected to oscillate weakly, refinery profits shrinking, and PDH profits gradually contracting. Although the demand increment from downstream propylene projects in 2026 is greater than the propylene production capacity increase, most downstream projects are scheduled for the fourth quarter. Therefore, the supply - demand situation will remain loose in the first half of the year, and attention should be paid to the PL03 - 05 inter - period reverse arbitrage opportunity. With the peak of downstream production capacity coming in the second half of the year, propylene inventory may gradually be reduced [2][11] 3. Summaries According to Relevant Catalogs 3.1 Market News and Important Data - **New Capacity**: 2026 is still a propylene production capacity expansion period in China, but the growth rate is expected to slow down compared to 2025. The expected new propylene production capacity in 2026 is 7.36 million tons, with a nominal capacity growth rate of 9.3% (the actual capacity growth rate weighted by the commissioning time is about 4.4%), significantly lower than that in 2025 [6][25] - **Supply Pattern**: In 2025, China's propylene industry was in a rapid capacity expansion period, with new production capacity reaching 9.485 million tons, intensifying the market supply pressure. The supply in the Shandong market remained loose [6][35] - **Import - Export Pattern**: In 2025, China's propylene imports generally decreased, and the import dependence gradually declined. The cumulative import volume from January to October was 1.8349 million tons, a year - on - year increase of 14.96%, and the cumulative export volume was 26,900 tons, a year - on - year decrease of 61.67%. The import dependence is expected to further decline [7][53] - **Demand Increment**: The propylene demand converted from downstream new projects in 2026 is 8.24 million tons, with a nominal growth rate of 9.57%. However, due to the concentration of downstream projects in the fourth quarter, the weighted actual demand growth rate may be only 3.86%, lower than the actual growth rate of new propylene production capacity. The inventory pressure will persist in Q1 - Q2, and the inventory may gradually be reduced in the second half of the year [7][116] 3.2 Market Analysis - In 2025, propylene supply was at a high level, with high upstream inventory and continuous price pressure. The core factor was the lack of obvious highlights in terminal demand. In the short term, there was no obvious sign of demand improvement. In the first half of 2026, the focus was on digesting the existing high inventory, but the supply remained loose. Attention should be paid to the positive feedback from PDH device maintenance [8] 3.3 Propylene 2025 Market Review - The domestic propylene spot price showed a downward trend in 2025, affected by supply - demand and cost factors. The price trend can be divided into four stages: a decline from the beginning of the year to early June, a short - term increase from late June to early August, a sharp decline from October to early November, and a weak rebound at the end of the year [17] - The propylene futures price showed a fluctuating downward trend, affected by the loose supply - demand situation and weak international oil prices. The game between warehouse receipt registration and delivery was an important factor affecting the futures price [18] 3.4 2026 China Propylene Commissioning Situation - From 2021 - 2025, the compound growth rate of propylene production capacity was 11.97%, with 9.485 million tons of new capacity in 2025, a growth rate of 13.6%. In 2026, the new capacity is expected to be 7.36 million tons, with a nominal growth rate of 9.3% (actual growth rate about 4.4%), lower than that in 2025 [25] 3.5 Propylene Supply Pattern and Production Profit Analysis - In 2025, the propylene supply was loose due to capacity expansion. The low - point of propylene operation mainly occurred in mid - to - late May, affected by PDH device maintenance. The profit of major refineries and PDH devices was compressed, which dragged down the operation rate, while the coal - based operation was less affected by profit [35][49] 3.6 Propylene Import - Export Pattern Analysis - In 2025, China's propylene imports decreased, and the import dependence declined. The import window remained closed, and the domestic price advantage was obvious. The import dependence is expected to further decrease [53] 3.7 Propylene Upstream Raw Material Propane Pattern Analysis - The price of propane had a significant impact on the profit of domestic PDH devices. In 2025, the propane price fluctuated greatly, affected by factors such as Sino - US tariffs, market demand, and supply. The price decline in the second half of the year compressed the profit of PDH devices and led to a decline in the operation rate [70] 3.8 Propylene Downstream Pattern Analysis - **Downstream Profit and Demand**: In 2025, the profit of propylene downstream products shrank, and the demand support was weak. Downstream factories mainly purchased propylene on a rigid - demand basis, putting downward pressure on the propylene price [86] - **2026 Downstream Commissioning Situation**: In 2026, the commissioning pace of propylene downstream projects slowed down. The converted propylene demand from downstream new projects was 8.24 million tons, with a nominal growth rate of 9.57%. However, the weighted actual demand growth rate may be only 3.86%, lower than the actual growth rate of new propylene production capacity. The inventory pressure will persist in the first half of the year and may be reduced in the second half [109][116] 3.9 Propylene and Downstream Inventory Situation and Outlook - In 2025, the propylene inventory remained high, and the high - production growth rate may continue in 2026. The inventory pressure of propylene and its downstream products such as PP and acrylonitrile will persist in the first half of 2026, but the PP inventory may be reduced in the first half of 2026 due to the slowdown of new capacity commissioning [117]

Report Industry Investment Rating - Not provided Core View of the Report - The domestic propylene futures market is facing dual pressures of continuous capacity expansion and weak downstream demand, with an imbalanced supply - demand fundamental. The price of propylene futures is expected to maintain a weak and volatile pattern in the short term, and the real improvement of the fundamentals requires the appearance of an inventory inflection point [2][6] Summary by Relevant Catalogs Supply Situation - China's propylene production capacity is in a rapid expansion cycle. In 2024, the total production capacity reached 70.44 million tons/year with a utilization rate of 76.6%. In 2025, over 5 million tons of new capacity is expected to be released. The PDH process is the main force for expansion, but most PDH plants face cost pressures and operate at a low utilization rate. In October 2025, the output was 5.476 million tons, a month - on - month increase of 5.2% and a year - on - year increase of 15.77%, and the capacity utilization rate was 74.0% [2] - Import profit is in a continuous inversion state, suppressing import volume. Although there is some room for export growth, the overall export volume remains stable, and domestic supply mainly depends on domestic demand [3] Inventory Situation - The port inventories in major distribution centers such as Shandong and East China are on an upward trend, and the social total inventory is estimated to be around 1.8 million tons. The inventory - to - consumption ratio is rising, and the production enterprise's in - plant inventory is also at a historical high. Downstream factories adopt a low - inventory strategy, which intensifies the upstream shipment pressure [3] Demand Situation - Although the downstream production capacity of propylene is growing, the terminal demand recovery is far below expectations, showing a "weak in peak season" situation. Downstream enterprises are mostly in a loss state, with low acceptance of high - priced raw materials and only maintaining rigid demand [3] - The performance of downstream products is differentiated. PP has relatively stable operating rates, but the profitability of different production routes varies greatly. Epoxy propane, butanol - octanol, and phenol - acetone are in losses, while acrylic acid and esters are profitable. Overall, the downstream's willingness to purchase propylene is severely suppressed [4] Macro - factor Influence - The end of the US government "shutdown" and the reduced probability of a Fed rate cut in December have weakened the macro - optimistic expectations for propylene futures. The market focus has returned to the industrial fundamentals, and the propylene futures price is more likely to be dragged down by the fundamentals [4][5]