Propylene and powders have a bumpy upward road restrained by downstream demand

At the beginning of the month, propylene stopped falling and strengthened because of good market conditions, but how narrow adjustment was affected by poor downstream demand. Also restrained by the demand is polypropylene powder. Although futures strongly pushed up the price of powder at the beginning of the week, the downstream plastic weaving demand has not improved, dragging down the upward trend of powder. What is the current trend of propylene and powder? How about the production profit of powder enterprises?

Entering the domestic propylene market in April, the decline is strong, and the market turnover is gradually warming up. Refinery inventory pressure is not large, the intention of price is more firm. Last week, the trend of international crude oil and polypropylene futures was steady, and the market positive increased, boosting the confidence of the industry. Refineries have obvious intention to push forward, refineries and traders with low local inventory have obvious reluctance to sell, and downstream warehouse replenishment is enthusiastic and trading is stable. In the early part of this week, the strong rise of polypropylene futures led to the spot market of powder and granular materials, which supported the propylene industry's mentality. However, due to the cautious downstream market entry, it just needed to buy mainly, and the mainstream transactions were narrowly adjusted. Up to now, the mainstream transaction in Shandong market is 7200-7250 CNY/ton, while that in Jiangsu market is 6950-7200 CNY/ton.

 Powder market shocks strongly this week. Monday's strong rise in PP futures boosted the mindset of traders, spurred the spot market, coupled with the strong rise in granular materials, supporting powder, the positive factors increased to promote the price of powder significantly. However, it is reported that downstream plastic knitting and middlemen are just in need of purchasing intentions, high-level conflicting psychology still exists, resulting in weak high-level transaction of powder. On Wednesday, due to poor downstream demand and futures, the price of powder conceded at a high level and fell slightly. On the supply side, powder factories operate normally, and there is no plan for overhaul and production reduction. Up to now, the mainstream transaction in Shandong market is 8350-8400 CNY/ton, and that in East China is 8350-8450 CNY/ton.

In summary, propylene and powder are currently restrained by downstream demand, upstream road is bumpy, but crude oil and peripheral environment operation is still acceptable, the latter rebound of both is still hopeful. As shown in the figure, taking Shandong market as an example, the price difference between propylene and powder is 1100 CNY/ton, the profit value of powder enterprises is 500 CNY/ton, and the profit margin is 6.42%. Therefore, at present, the production profit of powder enterprises is still acceptable.