China PP market faces weak trend
In the Chinese polypropylene (PP) market, supply was expected to recover after the October-December period, but demand was forecast to decline due to the weak demand period, so that inventories were likely to increase. Thus, there were growing concerns over looseness in supply/demand fundamentals, which weighed on the market.
On the supply side, run rates at PP facilities remained at a high level from January to August, and the maintenance season has almost ended by September, so that production was recovering. Imports also increased, so that overall supplies were abundant. In addition, new facilities at Baolai Basel, Zhongke refinery, and Quanzhou Petrochemical started operations. Thus, supplies were increasing further.
On the demand side, demand for daily necessities like masks has been firm due to the COVID-19 outbreak, so that run rates of derivative manufacturers were high, and inquiries for PP as a raw material remained strong. However, many derivative manufacturers have already secured the required amount, and demand was expected to decline after the National Day holidays in October.