Domestic PP: Inventory Rise & Price Decline

Domestic petrochemical inventory: The inventory of polyolefins from the two oils is 755,000 tons, an increase of 35,000 tons from yesterday.

Futures analysis: PP2509 opening price on July 1: 7077, highest price: 7077, lowest price: 7025, position: 423329, settlement price: 7048, yesterday's settlement: 7092, drop: 44, daily trading volume: 210887 lots, deposited funds: 2.087 billion, capital outflow: 19.73 million.

Market mainstream quotes for wire drawing:

Domestic spot market analysis: Today, the overall domestic PP market showed a downward trend, and market prices in various regions fell across the board, with a decline ranging from 10-70 yuan/ton. In terms of price: the mainstream price of domestic polypropylene ranged from 7010-7320 yuan/ton.

The crude oil market was affected by the signs of easing of the geopolitical situation and the expectation of a larger increase in OPEC production. The international oil price fell. In addition, many PP units in the field were shut down for maintenance. The pressure on the supply side was acceptable, but the demand was weak in the off-season, and it was difficult for downstream production to increase. The market mentality was cautious.

Analysis of the domestic futures market: The night market price of the PP2509 contract was weak and consolidated; it fell after the opening of the morning session, and then fluctuated slightly; the price rebounded in the afternoon, and then consolidated in a small range until the end.

As of today's afternoon closing, the PP2509 contract fluctuated in the range of 7025-7077 throughout the day, with a spread of 52.09 contracts reduced by 2,430 lots, and the current position was 423,329 lots.

Forecast for the future market: In terms of raw materials, in the short term, the crude oil market may be affected by favorable factors such as the traditional peak consumption season in the United States and unfavorable factors such as the geopolitical situation, OPEC+ maintaining its position of increasing production, and the poor global economy.

It is also necessary to pay attention to the relevant impact of related changes on international oil prices. On the supply side, it is expected that as some PP units that were overhauled in the early stage resume operation, the supply scale will be further expanded. 

In addition, if the new unit commissioning plan is smoothly promoted, the market supply pressure may be further aggravated. On the demand side, terminal demand may continue to be weak. Downstream industries are in the traditional off-season, and the operating rate is difficult to increase significantly. Factories are based on profit considerations and have little willingness to purchase, or they may still maintain the rigid demand purchase mode. Overall, it is expected that the short-term polypropylene market may be weak.

Domestic PP Index: According to Tuduoduo data, the domestic PP spot index on July 1 was 7116.00, down 24, a range of 0.34%.

Guoneng auction statistics: Guoneng Coal Chemical's auction volume today was 3147 tons, an increase of 74.74% from the previous day; the transaction volume was 1021 tons, an increase of 81.67% from yesterday, and the transaction rate was 32.44%, an increase of 1.24% from yesterday.

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