Stimulated by market sentiment improved and rising polypropylene prices in the Chinese market, the spot price of propylene in the Northeast Asian market rebounded, breaking the sharp decline since the beginning of November. Statistics show that during the week ending December 7, the spot price of propylene in Northeast Asia rose by 7.6% from the previous week to reach US$920/tonne (CFR, Northeast Asia). Market participants believe that this upward trend may not continue.

 

In terms of propylene demand, with the increase in the price of polypropylene, China's domestic market began to establish propylene stocks. The data shows that on December 7, the price of polypropylene yarn in the eastern China market was 9,525 yuan / ton (the price of the warehouse), up 6.1% from the end of November. Some participants in the propylene market also began to cut crude oil production from OPEC next year. The impact is cautious. Changes in crude oil prices will affect the sentiment of the downstream petrochemical market.

 

From the perspective of propylene supply, spot goods arriving in the Northeast Asian market in January 2019 may be limited, as the seller was unable to commit to the quantity in the long-term contract negotiations that began in the first half of November. Sellers will not be eager to bid in the next one to two weeks, and buyers may have to give up control of the market over the past few weeks.