Apr Propylene Prices to Inch Down on Weak Fundamentals Support
Introduction: In March, propylene prices moved sideways amid slightly strong supply support and relatively weak demand. In April, propylene prices may inch down on heavier supply pressure and limited demand support.
In March, China’s propylene prices fluctuated within a narrow range, with the monthly average prices mixed. In the northern market, propylene prices rose periodically due to the relatively strong supply support. As of March 19, the monthly average price in Shandong stood at RMB 6,852/mt, up 0.21% MoM. In the southern market, propylene prices fell after rising amid the tug-of-war between supply and demand. As of March 19, the monthly average price in East China was RMB 6,829/mt, down 1.18% MoM.
Propylene prices in the northern market went range-bound on strong supply and weak demand.
In March, propylene prices in the northern region fluctuated within a narrow range, with the monthly average price inching up. On the cost side, crude oil prices went down notably, weakening cost support for propylene prices. On the supply side, the newly added PDH capacity at Wanhua Chemical (Penglai) was put into operation and added to the total supply. There were both unit restarts and shutdowns in East China and North China, and the PDH unit at a major Shandong plant ran at lower loads, narrowing the propylene supply and giving some supply support for propylene prices. On the demand side, prices of most propylene downstream products presented a downward trend, and propylene prices went up periodically, indicating a notable decline in downstream product profits, so downstream plants showed lower acceptance for propylene prices, influencing purchasing positivity somewhat.
Northern Propylene Unit Maintenance
Remarks: SD is short for shutdown; RS is short for restart. The newly added unit maintenance of this week has been highlighted.
Propylene prices in the southern market first rose and then dropped on the game between supply and demand.
In March, propylene prices in the southern market first rose and then dropped, with the monthly average price inching down MoM. On the cost side, crude oil prices fell, indicating weak cost support for propylene prices. In terms of supply, the overall supply pressure on propylene producers was minor amid unit restarts and shutdowns, and the periodic upward trend in propylene prices in the northern market drove up southern propylene prices. On the demand side, downstream plants engaged in bargain-hunting and showed mediocre buying interest, weakening demand support for propylene prices.
Southern Propylene Unit Maintenance
Remarks: SD is short for shutdown; RS is short for restart. The newly added unit maintenance of this week has been highlighted.
Propylene prices may edge down due to slightly weak supply support in April.
On the supply side, there may be scheduled maintenance in East China, South China and at some Shandong plants, giving some supply support for the propylene market somewhat. However, considering newly added capacity release in the northern region and some unit restarts, propylene supply in Shandong may present an upward trend, and sales pressure on propylene producers may exist periodically. On the demand side, end demand may turn slightly favorable from Q2 2025, underpinning propylene prices somewhat. Nevertheless, downstream plants may show limited acceptance for propylene prices due to expected downstream unit maintenance and underperforming downstream profitability, dragging down the demand for propylene prices.
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