PP Market Gains Support Amid Supply Tightening, Demand Remains Steady

The polymer market experienced stable prices across most grades, with slight fluctuations in specific segments like polypropylene (PP). While supply tightened due to reduced operating rates, demand remained steady but subdued. External factors like crude oil price volatility and stable feedstock prices provided mixed cost signals.

Key Highlights

  • Stable Polymer Prices: Most polymer grades, including HDPE, LDPE, and PP, showed no significant price fluctuations.
  • Supply Constraints: Maintenance activities and reduced production rates at major domestic PP facilities led to a drop in operating rates to below 68%.
  • Demand Dynamics: Seasonal decline in woven bag consumption and diminished gains in pipe consumption were offset by strong demand for BOPP film and stable raw material reserves.
  • Global Market News: Brent crude oil traded lower at $71.94/bbl, while European Styrene contract prices dropped by €7/MT, reflecting moderated cost support for downstream products.

Polymer Price: Stable Prices Across Polymers

  • Low K (DG700) Rs 79.50 Ex Nhava Sheva/Mundra
  • Low K (B57) Rs 83 Ex Nhava Sheva/Mundra
  • LG LS100H Rs 76.75 Ex Mundra/Bhiwandi
  • LLDPE(±0) Rs.86.5/kg Ex Mundra/Bhiwandi.
  • LDPE prices are around(±0) Rs.116kg Ex Mundra/Bhiwandi.
  • HDPE PE100 natural (±0) Rs.88/kg Ex Mundra/Bhiwandi.
  • HDPE PE100 black (±0) Rs.89/kg Ex Mundra/Bhiwandi.
  • HDPE HM (±0) Rs.89/kg Ex Mundra/Bhiwandi.
  • HD Blow Molding(±0) Rs.91/kg Ex Mundra/Bhiwandi
  • PP Raffia (±0) Rs90.25 /kg levels Ex Godown
  • PP Film (±0) Rs.99.50 kg levels Ex Godown
  • PPCP (±0) Rs 97.75 /kg levels Ex Godown.
  • PP Lamination (±0) 97 /kg levels Ex Godown

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Polymer Supply Tightening Amid Maintenance

  • In late November, domestic PP market prices fluctuated slightly, with a narrow upward trend. The overall cost support from upstream raw materials, including crude oil, propylene, and propane, was average.
  • Geopolitical tensions kept crude oil price fluctuation expectations high. However, propylene prices stagnated due to increased domestic supply and cautious buyer behavior, while propane prices stabilized, providing mixed signals for PP cost support.
  • The supply side saw significant tightening, with domestic PP enterprises reducing operating rates. Major producers such as Zhejiang Petrochemical, Guangzhou Petrochemical, Donghua Energy, and CNOOC Shell carried out maintenance activities, and additional load reduction from Hebei Haiwei and Lianhong Xinke drove the industry’s operating rate down from 75% to below 68%. Shipments contracted, and inventory levels dropped by 20,000 tons to 680,000 tons, creating structural supply constraints that supported PP spot prices.
  • On the demand side, PP consumption remained weak and stable. The seasonal decline in woven bag consumption (used in fertilizers and cement) slightly reduced demand.
  • Earlier gains in pipe consumption, driven by real estate policies, diminished by late November. Meanwhile, demand for BOPP film remained strong, with raw material reserves in terminal enterprises stabilizing or increasing marginally.

Polymer News: Global Market Influences on Costs

  • European Styrene contract Price for December reduced by Euro 7/MT from its November settlement levels and assessed at Euro 1408/MT, CIF North West Europe levels.
  • Liaocheng Meiwu New Materials has shut its MTO Plant. The Plant is located in Shandong, China.
  • Brent Crude Oil Prices traded lower at USD/bbl 71.94.
  • Naphtha Prices assessed lower at US$ 635/- per MT CFR Japan basis.
  • Ethylene Prices assessed stable at US$ 900/- per MT CFR NE Asia and US$ 930/- per MT CFR SE Asia basis.
  • Propylene Prices assessed stable at US$ 830/- per MT CFR China basis.
  • Today January Future Prices of PP traded lower by 18 RMB at 7520, LLDPE by 28 RMB at 8417 and PVC by 53 RMB at 5115.

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Expert Opinion on Polymer Market Trends

  • In the short term, PP prices are expected to remain stable with potential slight increases. While supply-side tightening provides strong price support, caution remains due to concerns over weak downstream consumption and anticipated offline production from new capacity. Market trading is average, with limited enthusiasm for aggressive price chasing.
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