Report Information - Report Title: C3 Industry Chain Weekly Report [1] - Report Date: August 3, 2025 [1] - Analyst: Chen Xinchao [1] Investment Rating - No investment rating is provided in the report. Core Viewpoints - **LPG**: Import costs are decreasing, and prices are weakly oscillating. Domestic civil gas supply and demand are both weak, and the overall price is fluctuating weakly. Ether C4 prices are oscillating, and the overall chemical industry's start - up is expected to have limited short - term boost. [3] - **Propylene**: The supply - demand pattern is loose, and prices are under pressure and weak. Although the supply - demand gap may narrow further, it is difficult to drive price increases. The supply - demand pressure may ease from late August to September, and prices may turn around. [4] Summary by Section LPG Part Price & Spread - LPG domestic spot prices in various regions have decreased. For example, from July 25 to August 1, Shandong civil gas decreased by 100 yuan/ton, and South China imported gas decreased by 120 yuan/ton. [8][15] - CP prices were released lower, and FEI discounts narrowed and then decreased again. [16] Supply - US propane shipments to Japan and South Korea increased significantly, while shipments to China decreased significantly. [26] - Middle East LPG shipments decreased significantly, and shipments to China, India, and Southeast Asia all decreased. [34][40] - China's LPG total commodity volume was 52.7 million tons (+0.3%), with civil gas at 21.0 million tons (-0.0%). Propane imports increased by 22.5 million tons. [50][59] Demand & Inventory - Chemical demand: PDH decreased slightly, and MTBE's operating rate decreased for the first time after 8 consecutive weeks of increase. [65] - LPG refinery inventories: Some regions decreased, such as East China's civil gas refinery inventory decreased from 18.43 million tons to 18.08 million tons. [68] - LPG terminal import inventories: East China and Fujian reduced inventories, while other regions' terminals increased inventories. [78] Propylene Part Price & Spread - Upstream prices: Brent rose by 1.13 dollars/bbl, and WTI rose by 2.19 dollars/bbl week - on - week. [89] - Propylene prices: Shandong, East China, and South China decreased by 35, 125, and 100 yuan/ton respectively week - on - week. [89] - Downstream prices/profits: Some products' prices and profits changed, such as PP powder profit in East China increased by 105 yuan/ton. [91] Balance Sheet - **National Balance Sheet - Supply**: In August 2025, the total domestic propylene production was 529 million tons, with a weighted operating rate of 79.5%. [105] - **National Balance Sheet - Demand**: In August 2025, the total domestic propylene demand was 526 million tons, with a weighted operating rate of 79.0%. [108] - **Shandong Balance Sheet - Supply**: In August 2025, Shandong's total propylene production was 90 million tons, with a weighted operating rate of 64.0%. [112]

1. Report Industry Investment Rating There is no information provided regarding the industry investment rating in the report. 2. Core Viewpoints of the Report - This week, LPG futures fluctuated downward, showing a weaker trend compared to crude oil. With the supply path of OPEC+ basically determined, the divergence in global supply will decrease in the future. [6] - On the demand side, the peak season for the blending market is approaching, but the blending market has been operating at a high capacity utilization rate. If expectations are not met, a negative feedback loop may quickly form. Additionally, summer is a traditional off - season for civilian demand, with little possibility of unexpected changes. [6] - PDH profits have significantly recovered, which may support the subsequent operating rate. Overall, LPG supply is abundant, and CP prices are likely to fluctuate following crude oil. In the long - and medium - term, civilian demand is entering an off - season, and chemical profit margins are difficult to expand further. Therefore, LPG futures prices are more likely to fall than to rise. Next week, attention should be paid to the progress of the third round of China - US negotiations. [6] 3. Summary by Relevant Catalogs PART 01: LPG Market Review - The domestic LPG market showed a divergent trend this period. Civil gas prices rose slightly, while the price of ether - after carbon four declined. For civil gas, refinery supply was generally under no pressure, and the number of incoming vessels at import terminals decreased. Also, civil gas prices were generally low, showing a slight upward trend during the week. However, prices in the East China region declined due to the large volume and low price of local industrial gas. [5] - The expected average price of propane CP was 532 US dollars per ton, a decrease of 26 US dollars per ton from the previous period, a month - on - month decline of 4.66%. The expected average price of butane CP was 507 US dollars per ton, a decrease of 21 US dollars per ton from the previous period, a month - on - month decline of 3.98%. The average price of propane CFR in South China was 543 US dollars per ton, a decrease of 23 US dollars per ton from the previous period, a month - on - month decline of 4.06%. The average price of butane CFR in South China was 520 US dollars per ton, a decrease of 16 US dollars per ton from the previous period, a month - on - month decline of 2.99%. [5] - Recommended futures strategy: Try shorting at high prices. [7] PART 02: LPG Fundamental Analysis - **Supply - Import**: The report presents historical data on LPG import volume, including weekly arrival volume in China, monthly import volume from different countries (such as the United States, Qatar, Saudi Arabia, and the United Arab Emirates), and import trade profit margins in the South China region. [13][16] - **LPG Freight**: It shows historical freight rates from the Arabian Gulf region to the Far East and from the US Gulf Coast to the Far East. [19] - **LPG Inventory**: The report includes data on port inventory in China, refinery capacity utilization ratios in China, and factory - level inventory in China, as well as the production - sales ratios in regions such as South China, Shandong, and East China. [21][25] - **Industrial Indicators**: It presents data on the operating rates and production profit margins of PDH plants, MTBE plants, and alkylation oil plants in China. [30][32][34] PART 03: LPG - Related Price Data - **Import Cost**: It shows the CP far - month and current - month prices, including the predicted prices of propane and butane, CP contract prices, and the price trends of CP crude oil. [39] - **Domestic Prices**: It includes the ex - factory prices of civil LPG in different refineries (such as Guangzhou Petrochemical, Jinan Refinery, and Shanghai Gaoqiao), the ex - factory price of ether - after carbon four, the spot benchmark price of MTBE in Shandong, the market price of alkylated gasoline in Shandong, and the spot price of maleic anhydride. [41][45][46][47][49] PART 04: Other LPG Data - It shows the historical data of the basis of the LPG main contract, the price difference between the first - and second - month contracts, and the registered warehouse receipts of major delivery warehouses. [53][55]

1. Report Industry Investment Rating No relevant content provided. 2. Core Views of the Report LPG Part - This week, the domestic civil LPG market faced weak supply and demand. Supply slightly contracted, but seasonal demand was weak, and international LPG prices declined. Overall, prices fluctuated weakly within a narrow range, and the domestic basis strengthened due to the decline in PG futures. The price of etherified C4 oscillated downward and stabilized at the end of the week. Next week, civil demand is expected to remain seasonally weak, while the overall chemical production start - up is likely to receive some short - term support [3][4]. Propylene Part - This week, the domestic propylene market price first declined and then stabilized. At the beginning of the week, multiple restarted PDH units led to a significant increase in propylene supply, causing prices to decline. Later in the week, the restart of downstream parking units increased propylene demand, and prices stabilized [5]. 3. Summary According to the Directory LPG Part Price & Spread - LPG futures and paper prices showed certain fluctuations. For domestic spot and basis, civil gas prices in different regions had varying degrees of change, and the basis also changed. Regional quotes, premiums, and freight rates also had corresponding adjustments. Propane prices decreased compared to the previous period [8][10][18]. Supply - In domestic production, the total LPG commodity volume was 52.5 million tons, a slight reduction. The civil gas commodity volume was 21.2 million tons (-5.1%), and the etherified C4 commodity volume was 17.1 million tons (+0.7%). In terms of imports, the international vessel arrivals this week were 52.5 million tons (-16.4%). The production and imports of propane in China both decreased [4][38][45]. Demand & Inventory - In terms of demand, civil combustion demand remained seasonally weak due to high temperatures. The PDH operating rate increased significantly this week, and it is expected to rise further next week. The MTBE operating rate continued to increase to 67.6%, up 0.8% from the previous week. In terms of inventory, domestic refinery inventories of LPG and civil gas slightly increased, and LPG terminal import inventories in East China, South China, and Shandong all increased [4][48][52]. Propylene Part Price & Spread - In the propylene industry chain, upstream prices such as NAP, methanol, and propane showed different degrees of decline. Propylene prices in different regions also changed, with prices in Shandong, East China, and South China falling by 85, 15, and 100 yuan/ton respectively compared to the previous week. Downstream product prices and profits also had corresponding fluctuations [77][79][90]. Balance Sheet - The operating rates of different production methods in the propylene industry chain, such as domestic majors, Shandong local refineries, and PDH, changed. The national and Shandong propylene balance sheets showed the supply and demand situation in different months, including production, demand, and balance quantities [98][100][109]. Supply - This week, the domestic propylene market supply increased due to the gradual return of previously shut - down PDH units. The weekly propylene output was 1.166 million tons, an increase of 30,000 tons from the previous period, and the industry's overall capacity utilization rate increased by 1.9% to 73.1% [5]. Demand - This week, the overall operating rate of propylene downstream industries increased. The operating rates of downstream products such as butanol, acrylic acid, and PO all increased, mainly due to the gradual return of multiple shut - down units [5]. Downstream Inventory No relevant content provided.

Group 1 - The domestic liquefied gas market in China showed a downward trend in the first half of 2025, with an average price of 4833 yuan/ton for civil gas, down 84 yuan/ton or 1.71% year-on-year [2] - The average price for ether C4 was 4947 yuan/ton, a decrease of 317 yuan/ton or 6.02% year-on-year [2] - The overall energy prices were weak due to macro risks and supply-demand dynamics, with international crude oil prices fluctuating significantly [2][3] Group 2 - The supply of liquefied gas in the domestic market exceeded demand in the first half of 2025, with total supply estimated at 38.07 million tons and total demand at 37.56 million tons [3] - Inventory levels showed a trend of decreasing initially and then increasing, influenced by rising imports and low domestic demand [3] - The forecast for the second half of 2025 indicates a potential increase in liquefied gas prices initially, followed by a decline due to supply exceeding demand [4][6] Group 3 - The expected total supply for the second half of 2025 is 38.88 million tons, while total demand is projected at 37.60 million tons [4] - Domestic production is anticipated to increase due to reduced refinery maintenance and the gradual resumption of previously halted facilities [4] - The demand for liquefied gas is expected to rise slightly as the market transitions from off-peak to peak season, but overall demand remains in a downward trend [5] Group 4 - The average price forecast for civil gas in the second half of 2025 is 4773 yuan/ton, with a high of 4910 yuan/ton in October and a low of 4600 yuan/ton in July [7] - The average price for ether C4 is projected to be 4901 yuan/ton, with a peak of 5000 yuan/ton in September and a low of 4780 yuan/ton in December [7] - The market for ether C4 is expected to experience price fluctuations, initially rising due to increased demand and then declining in the fourth quarter [7]

Report Summary 1) Report Industry Investment Rating No information provided. 2) Core View of the Report - The LPG market shows complex trends, with civil gas prices rising first and then falling. The PG futures price fluctuates widely, the basis strengthens, and the spread between months changes little. The external market price weakens significantly, and the oil - gas ratio first suppresses and then rises. The import price drops significantly, and the profit of PDH production improves slightly. It is expected that the operating rates of PDH and alkylation will rise slightly next week, the combustion demand remains weak, and the subsequent price will generally stabilize [1]. 3) Summary by Related Catalogs Daily Data - From June 22 - 27, 2025, prices of various LPG - related products such as South China LPG, East China LPG, Shandong LPG, etc., show different trends. For example, South China LPG price changes from 4695 on June 22 to 4710 on June 27, with a daily change of - 45 on the 27th. The cheapest deliverable is Shandong civil gas at 4590. The 08 - 09 spread of PG is 94, and the US - to - Far - East arbitrage window is closed [1]. Weekly View - Civil gas prices rise first and then fall. The market is bullish at the beginning of the week due to geopolitical tensions, but then is under pressure as overall supply is high, high prices are resisted by downstream, and the easing of the Middle East situation leads to a sharp drop in oil prices. The basis of PG strengthens to 345. The external market price weakens significantly, and the oil - gas ratio first suppresses and then rises. The import price drops significantly, the profit of PDH spot production improves, and the profit calculated by paper goods rises. The profit of alkylation oil increases significantly, the profit of MTBE gas - fraction etherification remains basically flat, and the profit of isomerization etherification rises. In terms of fundamentals, port inventories increase due to more arrivals, factory inventories increase slightly with regional differentiation (East China destocks, South China and Shandong build up inventories), and external sales increase. The operating rate of PDH rises to 70.54% (+4.33 pct), and the operating rate of alkylation is 46.02% (-1.84 pct), with MTBE production basically flat. The number of registered warrants is 8358 (+0) [1].

Group 1: Report Industry Investment Rating - No industry investment rating is provided in the report. Group 2: Core Viewpoints - The supply increase is expected, while the expected increase in chemical demand provides some support. Shandong is expected to be boosted, and East and South China markets are more likely to fluctuate. Geopolitical tensions have significantly escalated, with the US attacking three Iranian nuclear facilities, which is expected to have a significant impact on market sentiment, so cautious operation is recommended [1]. Group 3: Summary by Relevant Data Price and Margin Data - From June 20 - 26, 2025, the prices of South China LPG, Shandong LPG, and other products fluctuated. For example, South China LPG prices ranged from 4660 to 4755. There were also changes in propane CFR prices, MB propane prices, etc. PDH production profit improved, with FEI production cost higher than CP. The daily change on June 26 showed 0 for South China LPG, -25 for Shandong LPG, etc. [1] Market Structure Data - The cheapest deliverable is East China civil gas at 4642. The PG futures price increased, with the 07 - 09 spread dropping 3 to 107. The US - Far East arbitrage window is closed. The 07 contract basis weakened to 80 (-141), and the monthly spreads (07 - 08, 07 - 09) changed significantly [1]. International Market Data - Outer - market prices continued to strengthen, and the oil - gas ratio increased. Regional spreads showed different trends: internal - external spreads strengthened, FEI - MB strengthened slightly, while FEI - CP and MB - CP weakened. The AFEI propane FOB discount weakened slightly to 2.25, and the CP CIF discount dropped significantly to 12 dollars. Freight rates increased slightly [1]. Downstream Profit Data - PDH spot profit improved due to rising拉丝 prices. FEI's profit from producing PP decreased, while CP's production profit increased. Alkylation and MTBE profits decreased, and the FEI - MOPJ spread shifted downward [1]. Fundamental Data - Due to delayed arrivals and a slight increase in chemical demand, port inventories and storage ratios decreased, while factory inventories remained basically flat, and external releases were also basically unchanged. Chemical demand was supported, with PDH and MTBE operating rates increasing and alkylation remaining basically flat. Multiple PDH plants are expected to increase their loads in the future [1]. Warehouse Receipt Data - The number of registered warehouse receipts was 8358 lots (-647), mainly due to Jinneng Chemical reducing by 270 and Shanghai Yuchi reducing by 377 [1].

Report Summary 1. Report Industry Investment Rating No information provided. 2. Core Viewpoints - The fundamentals of the LPG market remain weak, with chemical demand in Shandong providing some support, but supply pressures are high and demand remains sluggish in other regions [1]. - It is expected that the external supply will continue to increase and the inbound volume will decline. Chemical demand is expected to be supported in the short - term, with the PDH operating rate expected to increase next week [1]. - As temperatures rise, combustion demand is expected to decline, while gasoline demand recovery is expected to drive up the demand for alkylated oil, and the demand for C4 from MTBE plants is also expected to increase [1]. 3. Summary by Related Catalogs Price Changes - On a daily basis, civil gas prices increased in Shandong (+20 to 4620), East China (+40 to 4491), and South China (+20 to 4590); ether - post carbon four increased by 130 to 4810. The cheapest deliverable is East China civil gas at 4491 [1]. - FEI and CP import costs increased, PP prices rose slightly, and the profits from FEI and CP for PP production increased. The PG futures fluctuated, with the basis of the 07 contract increasing by 37 to 372 and the 07 - 09 spread decreasing by 5 to 203 [1]. Weekly Situation - Last week, civil gas was generally weak, but Shandong rose due to chemical demand support, while ether - post carbon four declined. The cheapest deliverable was East China civil gas at 4449. The PG futures fluctuated strongly, the basis of the 07 contract weakened to 351, and the spread strengthened significantly [1]. - Externally, FEI and MB were basically flat, CP declined, and the oil - gas ratio increased. The internal - external spread strengthened, especially PG - CP. The US - Asia arbitrage window closed, and freight rates rose slightly [1]. Variety Spreads - The production margin of PDH improved but remained poor; the production profit of FEI was higher than that of PP. The profitability of alkylated oil increased, the profit of gas fractionation and etherification changed little, and the profit of isomerization and etherification increased. FEI - MOPJ decreased, and the naphtha crack spread changed little [1]. Fundamental Situation - Port inventories increased slightly, and terminals actively offered discounts. Factory inventories increased, and Shandong factory inventories decreased due to chemical demand support. Arrivals increased (mainly in South China), and external supply increased significantly [1]. - Chemical demand is expected to be supported in the short - term, with the PDH operating rate basically flat and expected to increase next week. The demand for alkylated oil is expected to increase with the recovery of gasoline demand, and the demand for C4 from MTBE plants is expected to increase next week [1]. - As temperatures rise, combustion demand is expected to decline. In addition, the number of registered warrants is 9304 lots (-565) [1].

Report Industry Investment Rating - Not provided Core Viewpoints - Expected supply to increase, chemical demand to rise, and combustion demand to be weak, with an overall weak fundamental situation [1] Summary by Relevant Content Price Changes - On Thursday, for civil gas, prices in Shandong increased by 20 to 4510, in East China decreased by 12 to 4505, and in South China decreased by 50 to 4750; etherified C4 decreased by 60 to 4680; the cheapest deliverable was Shandong civil gas at 4510 [1] - CP import cost slightly increased, PP remained flat, and PP production profit slightly increased; PG futures prices were strong, with the 06 contract basis at -28 (latest 85), the 06 - 07 monthly spread at -8 (latest 87), and the 07 - 09 monthly spread at 3 (latest 156); the US - Far East arbitrage window opened [1] - Civil gas prices significantly declined, etherified C4 rebounded, the cheapest deliverable was Shandong civil gas at 4480; PG futures prices declined due to weak spot prices; the 06 contract basis was 385 (+139), the 06 - 07 monthly spread was 54 (-27), and the 07 - 08 monthly spread was 61 (-15) [1] - In the external market, FEI and MB declined, CP increased, the oil - gas ratio fluctuated; the internal - external price difference significantly declined, and FEI - MOPJ slightly declined; freight rates from the US Gulf to Japan and from the Middle East to the Far East declined [1] Supply and Demand - Arrivals decreased significantly, exports were sluggish, and overall port inventories decreased; factory inventories were basically flat; the commercial volume slightly increased and was expected to continue increasing; at the same time, expected arrivals were expected to increase [1] - PDH operating rate rebounded to 61.15% (+3.17pct), production gross profit declined, and PDH operation was expected to continue to rebound next week; alkylation operating rate and commercial volume remained flat, profitability significantly declined to -40.5 (-308), and operation was expected to slightly increase next week [1] - MTBE prices generally declined by 50 - 150 yuan/ton, MTBE production was basically flat, profits from gas fractionation etherification and isomerization etherification declined; expected MTBE supply to fluctuate narrowly, gasoline demand difficult to improve, and prices may not fluctuate much [1] - As the temperature rises, combustion demand is expected to decline [1]

Group 1 - OPEC's decision to implement compensatory production cuts supports oil prices, but tensions among OPEC+ members regarding production quotas may lead to proposals for increased output in June [1] - The international crude oil prices have shown alternating trends, with the price change rate narrowing in the current pricing cycle [1] - Domestic gas prices have experienced a downward trend, with a lack of significant positive news to boost market sentiment, leading to lower terminal product prices and weak chemical demand [1] Group 2 - Propane prices have retreated after a previous increase, with upstream sellers eager to offload inventory, but terminal demand remains weak [2] - The market anticipates a volatile trend for international crude oil prices next week, with expectations of improved conditions regarding the US-China tariff conflict and active procurement from Chinese buyers [3] - Overall, the market is facing multiple bearish factors, and propane prices are expected to consolidate weakly, with an average price decline anticipated [3]