Downstream Buyers Actively Restock at Low Levels; Propylene Prices Rebound After Decline (2026-09-07)

1. Today's Summary

① FOB Korea closed at USD 1,100/mt, and the China equivalent closed at RMB 9,242/mt.

② The domestic PP powder market corrected from recent highs. Affected by continued declines in feedstock propylene prices over the weekend, producer offers were lowered accordingly, while traders adjusted to follow the market. However, PP powder price spreads remained largely inverted, leading to substitution of some demand. Combined with the prevailing "buy on strength, not on weakness" sentiment, market participants stayed on the sidelines, and trading was mainly for rigid demand. As of noon, mainstream offers in East China were RMB 9,650-9,700/mt, while reference offers in Shandong were RMB 9,440-9,550/mt.

2. Spot Market Overview

Table 1 Summary of domestic propylene prices (unit: RMB/mt)

On September 7, the number of propylene information collection points in Shandong was 28, with 10 valid samples (excluding long-term agreements). Transaction volume was about 3,000 mt, with a price range of RMB 9,000-9,080/mt and an average of RMB 9,040/mt.

Chempricehub Information reported on September 7: Today, the mainstream closing reference for the Shandong propylene market was RMB 9,000-9,080/mt, with an average of RMB 9,040/mt, down RMB 260/mt from the previous working day. As propylene prices made concessions, market trading sentiment recovered. Producer offers were broadly stable, with a few local prices raised. Downstream factories followed up on demand, some auctions achieved slight premiums, and the transaction center moved up accordingly. However, overall sentiment remained weaker than the previous working day.

3. Production Dynamics

Propylene capacity utilization stood at 71.80%. PDH margins were RMB 1,207/mt in East China and RMB 1,057/mt in Shandong. Naphtha cracking process margins were USD 67/mt. MTO process margins were RMB -1,091/mt.

4. Price Forecast

Trading sentiment today was acceptable. However, with incremental supply being released on the supply side, upside price moves will be constrained. Market prices are expected to remain firm tomorrow.

5. Related Products

PP powder: The Linyi PP powder market ran weak and stable. High-priced goods moved slowly, and sellers held offers steady to observe the market, while downstream follow-up was limited. Grade 040 references were about RMB 9,530-9,650/mt delivered, with cash prices at RMB 8,911-9,023/mt. Grade 225 prices were referenced at RMB 9,700/mt.

Propylene oxide (PO): Mainstream PO negotiations in the Shandong market were at RMB 10,100/mt ex-works by cash. On the supply side, individual fluctuations resulted in slight output reductions. After operating plants stabilized today, overall trading ran stable-to-weak. All parties watched raw material price movements. Costs continued to provide support. Downstream users slightly slowed their pace amid high-priced feedstock, but with no short-term supply pressure, prices are expected to remain firm.

Octanol: Today, mainstream transactions in the Shandong octanol market were at RMB 8,800-8,900/mt. Downstream users were cautious about purchasing high-priced spot material, and market discussion sentiment was flat. Some local octanol units were shut down for maintenance, and reduced supply supported offers remaining firm at high levels.

6. Data Calendar

Table 2 Domestic propylene data overview (unit: 10,000 mt)

Notes: 1. ↓↑ indicates significant fluctuations, highlighting data dimensions with changes exceeding 3%. 2. ↗↘ indicates slight fluctuations, highlighting data with changes within 0-3%.