In December 2025, the domestic propylene oxide (PO) market exhibited a trend of "rising after fluctuations, followed by a pullback and then a rebound." According to the monitoring system of 100ppi.com, as of December 31, the benchmark price of propylene oxide was 7,733.33 yuan per ton, representing a decrease of 0.22% compared to December 1. The core market contradiction centered on the supply dynamics between the release of new production capacity and the phase-out of outdated facilities, compounded by fluctuations in raw material propylene prices and weak downstream demand, resulting in a phased price pattern. In early December, the propylene oxide market showed a steady upward trend, with prices gradually rising from 7,750 yuan per ton at the beginning of the month to 8,166.67 yuan per ton, a cumulative increase of 5.38%. **Raw Materials:** At the beginning of the month, propylene prices remained high at 6,180.75 yuan per ton, providing fundamental cost support. According to the 100ppi.com monitoring system, as of December 12, the benchmark price of propylene was 6,220.75 yuan per ton, an increase of 0.65% compared to the beginning of the month (6,180.75 yuan per ton). **Supply Side:** Due to accelerated destocking by some small and medium-sized enterprises, the availability of circulating goods in the market tightened temporarily. Downstream polyether plants initiated restocking and actively procured materials, with order volumes increasing by approximately 15% compared to the end of November. Wanhua Chemical simultaneously increased external procurement, further alleviating supply pressure. Leading producers raised ex-factory prices by 100–150 yuan per ton, driving the market transaction focus upward. Entering mid-December, the propylene oxide market faced pressure from the release of new production capacity amid weak demand, leading to a decline in prices. As of December 24, prices gradually fell from 8,166.67 yuan per ton (December 12) to 7,850 yuan per ton, a cumulative decrease of 3.88%. **Raw Materials:** Propylene prices continued to decline. As of December 31, the benchmark price of propylene was 5,711.00 yuan per ton, a decrease of 7.6% compared to the beginning of the month (6,180.75 yuan per ton), weakening cost support. **Supply Side:** Lianhong Gerun’s 300,000-ton-per-year PO plant commenced production ahead of schedule on December 10. Combined with the release of other new production capacities in Shandong, the tight supply situation in the market significantly eased, with enterprise inventories rebounding to 46,000 tons. **Demand Side:** The operating rate of downstream PP powder plants dropped to a low of 37%. Polyether enterprises reduced procurement volumes by 30% due to weak orders from end-use sectors such as construction materials and home furnishings, maintaining only small-scale purchases for essential needs. Factories in both northern and southern regions engaged in low-price destocking, further dampening market sentiment. In late December, the propylene oxide market exhibited "fluctuating rebounds amid supply-demand dynamics," with prices recovering from 7,850 yuan per ton to 8,050 yuan per ton, an increase of 2.55%. **Raw Materials:** Propylene prices continued their downward trend, providing weak cost support. **Supply Side:** On December 22, Lianhong Gerun’s PO plant officially began producing qualified products, theoretically adding 800 tons of daily supply, initially triggering bearish sentiment in the market. However, a large factory in northern China temporarily halted operations due to environmental rectification, affecting daily production capacity by 500 tons, creating a counterbalancing effect on the supply side. Northern factories seized the opportunity to significantly raise ex-factory prices by 200 yuan per ton, driving spot quotations upward. **Demand Side:** Downstream enterprises showed limited acceptance of high-priced raw materials, with new order fulfillment rates below 40% and strong resistance. After the price increase, the market quickly entered a stalemate, with a weaker trend toward the end of the month. **Outlook:** According to 100ppi.com’s propylene oxide analyst, the current propylene market is trending weakly, providing limited support for propylene oxide and constraining producers’ ability to maintain high prices. On the supply side, the release of new production capacity and the phase-out of outdated facilities are occurring simultaneously, leading to increased industry concentration but short-term supply abundance. Downstream sectors generally face profit squeezes, with procurement primarily driven by essential needs, making sustained price increases difficult. It is expected that the propylene oxide market will operate with a stable to slightly stronger trend going forward, with close attention needed on raw material prices and market supply-demand dynamics.