Post-Rise Consolidation at High Levels; Sideways Trading Momentum Waning (Oct 9–15, 2026)

1. Key Market Focus This Week

• Supply: Sanyue Plant underwent scheduled maintenance shutdown during the week, while Huatai, Qixiang, Ruiheng, and Xinyue reduced operating rates within a narrow range. Selective volume reductions were also observed in South China. Netting these factors, overall supply contracted. Total production for this period was 130,900 tons, down by 7,600 tons from the previous period. Capacity utilization stood at 69.90%, a decrease of 4.03 percentage points compared to the prior period.
• Costs: The average weekly comprehensive profit for propylene oxide (PO) produced via the chlorohydrin process was -529.83 RMB/ton, representing a month-on-month improvement of +6.27%. Theoretical profit for PO produced via the HPPO (Hydrogen Peroxide to Propylene Oxide) process was -1052.33 RMB/ton, up +12.05% from the previous period.

2. Weekly Market Analysis

This week, the domestic propylene oxide market entered a consolidation phase following recent gains, characterized by intense bargaining between buyers and sellers. Last week, coinciding with post-holiday resumption of operations, the market maintained a strong upward trend supported by cost pressures, low inventory levels among suppliers, and essential procurement demand from downstream users. Prices reached relatively high levels by the weekend before stabilizing as market participants absorbed the increases. Although some plants initiated short-term maintenance leading to slight supply contractions this week, trading sentiment cooled significantly. Following the initial wave of essential purchasing, new order flow slowed, prompting downstream buyers to reduce their procurement volumes. Meanwhile, the key feedstock, propylene, halted its rise and traded sideways within a narrow range. With bullish and bearish factors intertwining, the market remained in a stalemate. While individual negotiations occurred, actual transactions were scarce, and mainstream prices held steady. As of Thursday, October 15, ex-factory cash prices in Shandong’s mainstream market ranged between 11,600–11,600 RMB/ton.

During this period, propylene oxide operating rates declined: Sanyue Plant shut down for maintenance, while Huatai, Qixiang, Ruiheng, and Xinyue slightly lowered their loads; selective volume reductions occurred in South China. On the cost side, propylene prices stabilized after reaching highs, and liquid chlorine prices remained steady, keeping representative production processes in a loss-making state. On the demand side, most downstream users had concentrated their shipments and raw material purchases in the previous week. This week, they adopted a wait-and-see approach regarding high PO prices, shifting focus back to contract fulfillment and essential needs. Market sentiment cooled, new orders weakened, and prices saw minor adjustments downward.

3. Propylene Oxide Outlook and Forecast

Looking ahead, feedstock propylene and liquid chlorine are expected to consolidate with slight weakness, moderately reducing cost-side support. Regarding supply, Jinling Plant is projected to undergo staggered maintenance shutdowns, Sanyue Plant will restart one unit, and volume reductions at Huatai and in South China are expected to recover in the latter half of the week, while other facilities maintain current operations. Estimated production will continue to contract slightly. On the demand side, while some essential purchasing remains, many downstream users prefer to wait for potential price declines before increasing their orders. The market is likely to experience narrow-range fluctuations, potentially trending lower initially before recovering. However, upside and downside movements are limited due to competing bullish and bearish factors. Attention should also be paid to volatility in crude oil prices.

For more detailed weekly market analysis, please refer to Chempricehub’s Weekly Propylene Oxide Report.