In October, China's propylene oxide market first rose and then stabilized

October 31 News

In October, the Chinese epoxy propane market first increased and then stabilized. According to the monitoring system, as of October 31, the benchmark price of epoxy propane was 7,700 CNY per ton, a decrease of -0.86% compared to October 1.

Price influencing factors:

On the raw materials front: In October, the market price of propylene—a key raw material—slid slightly. However, a sharp rebound in liquid chlorine prices pushed up the cost of the chlorohydrin process, putting significant financial pressure on producers and reducing their willingness to supply at low prices. As a result, the price of propylene oxide surged during the first half of the month. According to our monitoring system, as of October 31, the benchmark price for propylene stood at 6,095.75 CNY per ton, down 6.84% from the beginning of the month (6,543.25 CNY per ton).

Supply side: In the first half of the month, large factories such as Lihuayi underwent plant maintenance, reducing the circulation of spot goods and shrinking market supply, leading to a significant increase in propylene oxide prices. In the second half of the month, with fewer refinery maintenance activities and the resumption of production by previously shut-down enterprises, the supply of propylene oxide in China increased. As a result, propylene oxide prices declined in the second half of the month.

On the demand side: Downstream demand remained weak in October, with polyether companies largely maintaining rigid demand procurement strategies and adopting a cautious, wait-and-see approach. As a result, demand provided limited support to the propylene oxide market. While demand activity was relatively concentrated during the first half of the month, order volumes declined noticeably in the second half, leading to a generally subdued trading atmosphere. Overall, demand-side support for propylene oxide has weakened, and the market is expected to stabilize in the coming period.

Market Forecast:

Epoxypropane analysts note that the market price of propylene, the raw material, has slightly declined, weakening support for epoxypropane. Downstream demand remains weak, with buyers primarily focusing on essential purchases while adopting a cautious, wait-and-see approach. Additionally, with Liuhua Yi's production facility restarting, market supply has increased somewhat. As a result, the epoxypropane market is expected to stabilize in the near term, though close attention will still be needed on raw material prices and shifts in supply and demand dynamics.