This week, as major production units that were previously under maintenance gradually resumed operations, the overall industry operating rate increased, leading to a rise in market supply. Consequently, domestic propylene oxide (PO) prices experienced a significant correction. According to the monitoring system of 100ppi.com, as of February 6, the benchmark price of propylene oxide was 7,800 yuan per ton, representing a decrease of 4.88% compared to February 1.

On the raw material front: The price of raw material propylene saw a slight increase, providing moderate cost support for propylene oxide. As of February 6, the benchmark price of propylene was 6,437.67 yuan per ton, up by 0.52% compared to the beginning of the month (6,404.33 yuan per ton).

On the supply front: With the conclusion of previous maintenance and the release of new production capacity, major production units (such as some in East China) that were under maintenance earlier this week gradually restarted. This led to an increase in the overall industry operating rate and a rise in market supply. Additionally, new production capacities from companies like Binzhou Chemical and Wanhua Chemical, which resumed operations after maintenance in December, were gradually released in January, further boosting market supply.

On the demand front: The concentrated stockpiling activities by downstream polyether enterprises for the Spring Festival and the policy window period (before the cancellation of export tax rebates) were largely completed by mid-to-late January, resulting in insufficient follow-up orders. Moreover, as the Spring Festival approaches, downstream enterprises' purchasing enthusiasm has declined, leading to a subdued market trading atmosphere and weak demand performance.

Market outlook: According to the propylene oxide analyst at 100ppi.com, the combination of supply recovery and the off-season in demand has shifted the market from tightness to oversupply, causing prices to decline sharply. It is expected that propylene oxide prices may remain weak and stable in the short term. Further attention should be paid to changes in raw material prices and market supply and demand dynamics.