Morning Market Briefing: Propylene Glycol

I. Key Focus Points

1. Crude Oil: As of November 11, geopolitical tensions in the Middle East remain unstable, and prospects for U.S.-Iran negotiations are uncertain, driving up international crude oil prices. NYMEX WTI crude oil futures (December contract) closed at $86.53/bbl, up $0.49/bbl (+0.57% WoW); ICE Brent crude oil futures (January contract) closed at $92.76/bbl, up $1.27/bbl (+1.39% WoW). China INE crude oil futures (contract 2701) fell by RMB 15.2 to RMB 584.1/bbl during the day session, but rose by RMB 13.2 to RMB 597.3/bbl in the night session.
2. Raw Materials: Calculations indicate that new propylene glycol (PG) production has turned profitable from losses; however, cost-side support remains limited.
3. Supply: Operating rates for PG plants in Shandong are expected to remain at low levels. Supply constraints in northern regions provide supportive factors.
4. Downstream Dynamics: The unsaturated resin market center is consolidating; spot polyether markets are trending weakly.
   • Core Logic: Reduced supply from northern regions provides some support, but new orders remain sluggish. There is strong resistance to high PG prices, with downstream buyers only passively following through on minimal rigid demand.

II. Price Table

Notes:

1. Propylene glycol and dimethyl carbonate are industrial grade.
2. Prices are quoted in RMB per ton.
3. Payment terms: Propylene glycol and dimethyl carbonate are quoted ex-works with acceptance bills; propylene oxide and polyether are quoted ex-works with cash settlement; unsaturated resin is quoted ex-factory pickup.
4. The two price columns represent spot prices on the respective dates, not weekly averages.
5. The change rate reflects the period-over-period variation.

III. Market Outlook

The domestic propylene glycol market saw stable negotiations with slight adjustments on the previous business day. New PG production margins have shifted from loss to profit, limiting raw material cost support. While operating rates in northern regions remain low, new order inquiries continue to be lackluster. Downstream sentiment shows strong resistance to higher prices, with transactions primarily driven by passive follow-through of rigid demand. Amid efforts to clear inventory, some domestic PG factories lowered their asking prices yesterday, but trading activity remained weak. Overall, consecutive days of difficult new order settlements suggest that domestic PG prices may test lower levels due to weak demand. However, supply-side support from northern regions may limit the downside potential. Further monitoring is required.

Notes:

1. ↓↑ indicates significant volatility, highlighting data dimensions with fluctuations exceeding 3%.
2. ↗↘ indicates narrow-range fluctuations, highlighting data dimensions with fluctuations within 0-3%.