According to the Commodity Market Analysis System of Shengyi Society, the PP market has been weakly consolidated recently, with prices of various brand products experiencing a narrow decline. As of September 24th, the mainstream offer price for wire drawing by domestic producers and traders is around 7571.43 yuan/ton, with a decrease of -2.75% compared to the beginning of the month.

Price trend

In terms of raw materials:

In terms of international crude oil, the previous peak oil season in the United States has ended, and the crude oil market was under pressure and fluctuated in the first half of September. The unexpected interest rate cut by the Federal Reserve after the holiday has affected the narrow rebound of oil prices, and the upstream support of PP in the far end still exists. The consumption of propylene has contracted due to the decrease in downstream production, resulting in poor shipment performance and limited improvement in market momentum. After the price fell, it consolidated and the wait-and-see sentiment intensified. In the early stage, domestic supply of methanol recovered, and prices fell narrowly. The price of propane is mainly sideways, with stable fundamentals and positive expectations for the future market. The strength of cost support for PDH production and methanol to PP production is mutually apparent. Overall, in mid September, various raw materials were struggling to support PP, with moderate strength.

Supply side:

Recently, the load level of domestic PP enterprises has continued the pattern of large stability and small increase in the early stage. Some facilities resumed work around the weekend, and the industry load has narrowly increased to around 77%. The maintenance in the future market is relatively intensive, with maintenance plans from companies such as Daxie Petrochemical and Fujian United, resulting in an overall downward trend in supply. At present, the commercial inventory of PP in China is stable at over 760000 tons, which has accumulated compared to before, and the on-site supply is abundant. Overall, the supply side provides average support for PP spot prices.

In terms of demand:

The heating rate of the low PP demand side in September remained at a relatively slow level. The load on terminal enterprises has increased, and the consumption of woven bags such as fertilizers and cement has increased. The willingness of plastic weaving enterprises to build warehouses has also increased narrowly. However, orders from film companies have weakened to some extent due to the contraction of pre holiday stocking consumption. However, the macro commodity market sentiment has improved, and the market momentum has been boosted by it. The demand side still provides sufficient support for PP spot goods.

Future forecast

In late September, the domestic PP market prices were relatively weak. Fundamentally speaking, the comprehensive support of upstream raw materials for PP is average, and the consumption volume during the peak season continues to slowly rise. The Fed’s interest rate hike also benefits macroeconomic drivers. The current positive market guidance still needs time to be implemented. With the National Day holiday approaching, there are expectations of holiday economy and policy guidance supporting the market, which is expected to alleviate the downward pressure on PP prices and even show signs of recovery.

According to the Commodity Market Analysis System of Shengyi Society, the overall trend of mixed xylene market has been declining recently (9.16-9.23). On September 16th, the benchmark price of mixed xylene was 6260 yuan/ton, a decrease of 1.28% from 6180 yuan/ton on September 23rd. The mixed xylene market is still operating weakly in this cycle, with overall market prices. As of September 23, the mainstream price range for xylene in the East China region was 6000-6050 yuan/ton in the morning, a decrease of 200 yuan/ton compared to the same period last week. Although crude oil prices have risen during the cycle, which has given the market a certain boost, the Shandong region has been affected by poor demand during the Mid Autumn Festival holiday, and local refining companies have lowered their ex factory quotations, resulting in a low mentality in the spot market and a strong downstream pressure mentality, leading to a weak overall market operation. The overall market in other regions has also been affected, shifting from rising to falling.

Cost wise: The international oil price market first fell and then rose. As of the 19th, the settlement price of the main contract for WTI crude oil futures in the United States was $71.95 per barrel, and the settlement price of the main contract for Brent crude oil futures was $74.88 per barrel. The crude oil market has started to decline in this cycle, and this news is negative for international oil prices due to the easing of tensions in the Middle East. Global crude oil demand fell short of expectations, coupled with the end of the peak oil season in the United States, dragging down the crude oil market and causing a decline in crude oil market prices. The rise in crude oil market prices in the later stage of this cycle, coupled with the tense geopolitical situation in the Middle East and the Federal Reserve’s interest rate cuts, has boosted the crude oil market. Looking ahead, the current geopolitical instability continues to affect the market. The traditional peak season in the United States has ended, and global economic data has performed poorly. However, the Federal Reserve’s interest rate cuts have boosted the oil market, and the crude oil market is mainly volatile.

Supply side: During this cycle, most of Sinopec’s xylene quotations have been lowered. Currently, the company is operating normally, with stable production and sales. The company’s quotations remain unchanged from the previous day. As of September 23rd, East China Company quoted 6100 yuan/ton, North China Company quoted 6100-6150 yuan/ton, South China Company quoted 6300-6400 yuan/ton, and Central China Company quoted 6100 yuan/ton.

Demand side: The phthalic anhydride and xylene markets are operating weakly

According to the Commodity Market Analysis System of Shengyi Society, as of September 20th, the price of phthalic anhydride produced by phthalic anhydride was 7337.50 yuan/ton, which was temporarily stable compared to the price of phthalic anhydride on September 18th at 7337.50 yuan/ton, but decreased by 0.34% compared to the price of phthalic anhydride on September 14th before the holiday at 7362.50 yuan/ton. This week, the price of ortho xylene is 7400 yuan/ton, which is temporarily stable compared to before the holiday. The cost of neighboring phthalic anhydride is temporarily stable, and the phthalic anhydride market is stabilizing. This week, the domestic price for ortho phthalic anhydride is 7200-7400 yuan/ton, while the domestic price for nano phthalic anhydride is 7100-7200 yuan/ton.

On September 23rd, Sinopec Sales Company implemented a price of 7800 yuan/ton for xylene, which remained unchanged from the price on September 16th. The PX price continued to decline both inside and outside the cycle, with CFR China closing at $840-842/ton as of September 20th, a cumulative decrease of $6/ton from $834-836/ton on September 17th.

Market forecast: From a cost perspective, the recent improvement in the crude oil market provides some support for market sentiment. In terms of supply, the inventory of xylene in Shandong region has remained high recently, and enterprises are actively reducing prices to clear inventory. The port inventory in East China has slightly increased recently, and there are still some incoming goods this week. The overall supply of xylene in the market is relatively loose. On the demand side, although downstream enterprises have a need to replenish inventory near the holiday, the overall demand still leans towards rigid demand, and the market downturn atmosphere is more wait-and-see. Overall, under the influence of loose supply, it is expected that the atmosphere in the spot market will remain weak in the short term. The market trend is expected to remain stable and fluctuate slightly in the short term, with a focus on pre holiday stocking in the future.

After the holiday, the phthalic anhydride market stopped falling and stabilized

According to the Commodity Market Analysis System of Shengyi Society, as of September 20th, the price of phthalic anhydride produced by phthalic anhydride was 7337.50 yuan/ton, which was temporarily stable compared to the price of phthalic anhydride on September 18th at 7337.50 yuan/ton, but decreased by 0.34% compared to the price of phthalic anhydride on September 14th before the holiday at 7362.50 yuan/ton. This week, the price of ortho xylene is 7400 yuan/ton, which is temporarily stable compared to before the holiday. The cost of neighboring phthalic anhydride is temporarily stable, and the phthalic anhydride market is stabilizing. This week, the domestic price for ortho phthalic anhydride is 7200-7400 yuan/ton, while the domestic price for nano phthalic anhydride is 7100-7200 yuan/ton.

Supply side: tight supply of goods

Domestic phthalic anhydride plants operate at low loads, with frequent shutdowns of naphthalene phthalic anhydride equipment and low load operation of neighboring phthalic anhydride equipment. Phthalic anhydride manufacturers are experiencing tight supply and queuing for shipments, resulting in a tight supply of phthalic anhydride and significant upward pressure.

The cost of raw material ortho benzene is temporarily stable

According to the Commodity Market Analysis System of Shengyi Society, as of September 20th, the price of ortho benzene was 7400 yuan/ton, which was temporarily stable compared to the pre holiday ortho benzene price. The price of ortho benzene is temporarily stable, the cost of ortho phthalic anhydride is stabilizing, and the downward pressure on ortho phthalic anhydride is weakening.

Demand side: DOP market trend rising

According to the Commodity Market Analysis System of Shengyi Society, as of September 20th, the price of plasticizer DOP was 8963.75 yuan/ton, a significant increase of 5.44% compared to the DOP price of 8501.25 yuan/ton on September 14th. The price of DOP has significantly increased after the holiday. The operating rate of plasticizer enterprises has increased, coupled with stocking up before the National Day holiday, resulting in an increase in downstream demand for plasticizer DOP.

Future forecast

According to the data analyst of Shengyi Society’s phthalic anhydride products, in terms of cost, the price of ortho xylene is temporarily stable, while the cost of phthalic anhydride is stabilizing; In terms of supply, phthalic anhydride manufacturers are operating at low loads, resulting in a tight supply of phthalic anhydride; In terms of demand, DOP manufacturers have increased production, downstream DOP market has risen, and demand for phthalic anhydride has rebounded. It is expected that the market for phthalic anhydride will stabilize in the future.

According to the Commodity Market Analysis System of Shengyi Society, as of September 19th, the benchmark price of Shengyi Society’s epoxy propane was 8725 yuan/ton, an increase of 1.37% compared to the beginning of this month (8607.5 yuan/ton).

Price influencing factors:

Supply side: Downstream polyether new orders increase, the shipping atmosphere of enterprises is good, inventory is sufficient, and the price trend of epoxy propane market is stabilizing.

Raw material side: The market price of raw material propylene has decreased. Although the manufacturer has sufficient inventory, downstream demand is weak, and the company reduces profits by selling at low prices, resulting in a decrease in actual trading volume. According to the market analysis system of Shengyi Society, as of September 19th, the benchmark price of propylene in Shengyi Society was 6750.75 yuan/ton, a decrease of -3.12% compared to the beginning of this month (6968.25 yuan/ton).

Downstream demand side: The downstream order volume has slightly increased, but the sustainability is weak, and the supply and demand transmission is not smooth. Many adopt a wait-and-see attitude, and the epoxy propane market is experiencing a situation of mixed ups and downs.

Market forecast:

An epoxy propane analyst from Shengyi Society believes that although there is some support for raw material prices, the downstream has a strong wait-and-see attitude, mainly focusing on on-demand procurement, and the transmission of supply and demand is not smooth, resulting in mixed ups and downs of epoxy propane. It is expected that the short-term epoxy propane market will be mainly volatile, and more attention should be paid to market information guidance.

According to the monitoring of nickel prices by Shengyi Society, nickel prices rebounded slightly this week (9.10-9.18). On September 11th, nickel prices dropped to 121716 yuan/ton, a new low since May 2021. As of September 18th, spot nickel prices were reported at 124675 yuan/ton, with a weekly increase of 2,21% and a year-on-year decrease of 24.25%.

Macro wise: On Wednesday, the Russian President stated that Moscow should consider restricting nickel exports. If Russia implements the proposed ban, global nickel supply may shift from the current global oversupply of 100000 tons to a shortage. The news has pushed nickel prices up significantly, reversing the recent unfavorable trend. Russia is a major supplier of nickel to China and Europe. Nickel price is currently the weakest metal in LME trend.

Supply side: There is an oversupply in both domestic and international markets, and inventory continues to increase. As of September 13th, Shanghai nickel inventory was 24014 tons, an increase of 1571 tons from last week; On September 18th, LME nickel inventory was 123726 tons, an increase of 2070 tons from September 10th.

In terms of demand: The market will still be in the destocking stage in the near future, and the demand for spot goods has not increased as expected. The market activity still needs to be improved. Stainless steel prices are running weakly at a low level. On September 18th, the benchmark price of stainless steel plates in Shengyi Society was 12435.71 yuan/ton, a decrease of 2.52% from the beginning of the month. The demand for alloys in military and shipping industries is still acceptable, and customers have a strong need to continue.

Market forecast: Global inventory is under pressure, nickel prices hit a three-year low, demand support is insufficient, and the rebound from bottoming out is limited. It is expected that nickel prices will mainly consolidate in the short term.