PP Market Stabilizes Amid Weak Cost Support & Gradual Demand Recovery

Key Highlights:

1. Price Stability Post-Correction: PPCP and PPHP prices remained steady across major producers like Reliance, IOCL, and MRPL.
2. Fluctuating Supply & Demand: Domestic PP production dipped to 77% utilization, but demand for woven bags and industrial applications started recovering.
3. Global Market Movements: Key PP plants in South Korea and China restarted or scheduled maintenance, affecting regional supply.
4. Market Outlook: While short-term price movements remain limited, gradual demand recovery suggests stronger market activity in the coming months.

Polypropylene Price Overview & Trends

• PPCP (Random) prices are as follows: Reliance at ₹104,500/MT, Haldia at ₹102,000/MT, and IOCL at ₹103,000/MT. 
• PPHP prices vary by type—Lamination (MRPL) is priced at ₹101,000-₹104,500/MT, IM (MRPL) ranges from ₹98,500-₹100,000/MT.
• Raffia (MRPL) is between ₹97,000-₹99,500/MT, and TQ Film (MRPL) is listed at ₹99,000-₹101,000/MT.

Supply & Demand Dynamics: Stabilization After February Fluctuations

• The Polypropylene (PP) market in February experienced fluctuations before stabilizing, with most brands seeing slight price reductions. Despite a gradual reduction in domestic PP production rates, supply remained ample, with industry load levels dropping from 83% in January to 77% by the end of February. 
• Weekly domestic PP production averaged 730,000 tons, with no new capacity additions during the month. The accumulated supply from previous expansions was gradually absorbed.
• Trading activity remained weak through most of February. However, by the end of the month, the resumption of industrial operations led to early signs of recovery. 
• Demand for woven bags used in fertilizers, cement, and rice started improving, with inventory levels at plastic weaving enterprises partially digested. While spot market volume remained subdued, buyer stocking potential is expected to rise in the near future.

Global Market Updates & Industry Developments

• LG Chem has restarted its Polypropylene (PP) and Polyethylene (PE) units following an outage. The units are located in Daesan, South Korea, with a PP production capacity of 380,000 tons per year, HDPE capacity of 260,000 tons per year, LDPE capacity of 145,000 tons per year, and LLDPE capacity of 200,000 tons per year.
• Sinopec Guangzhou Petrochemical is planning to restart its No.3 Polypropylene (PP) unit on March 11, 2025, after maintenance work. The unit is located in Guangzhou, Guangdong, China, with a production capacity of 200,000 tons per year.
• Sinopec Hainan Petrochemical has shut its Polypropylene (PP) unit on March 10, 2025, for planned maintenance work until March 20, 2025. The unit is located in Yangpu, Hainan, China, with a production capacity of 200,000 tons per year.
• Oriental Energy (Ningbo) is planning to shut its No.1 Polypropylene (PP) unit for maintenance work starting from mid-March until mid-April, 2025. The unit is located in Ningbo, Zhejiang, China, with a production capacity of 400,000 tons per year.
• Sinopec Hainan Petrochemical is planning to shut its Polypropylene (PP) unit for maintenance work starting from March 10 until March 20, 2025. The unit is located in Yangpu, Hainan, China, with a production capacity of 200,000 tons per year.

Market Outlook & Expert Insights

• After the February price correction, the PP market is stabilizing. The upstream raw material market remains weak, offering limited cost support. While supply pressure is easing, it is expected to remain balanced. Consumption is gradually recovering, hinting at potential market improvement.
• However, in the short term, strong bullish sentiment is lacking, and market momentum remains fragile. PP prices are likely to consolidate with limited fluctuations, with a stronger recovery anticipated in the coming months as demand strengthens.