Supply: Overall stable with increased output. Total production for the period was 138,500 tons, an increase of 1,400 tons compared to the previous period. Capacity utilization stood at 73.93%, up 0.72 percentage points from the previous period.
Costs: The average weekly comprehensive profit for propylene oxide (PO) produced via the chlorohydrin process was -565.25 yuan/ton; theoretical profit for the HPPO (hydrogen peroxide to propylene oxide) process was -1,196.5 yuan/ton.
During this period, the domestic propylene oxide market rebounded and trended upward. Amid the National Day holiday, prices initially rose slightly before pre-holiday declines, then dropped significantly on the first day of the holiday to relatively low levels. Downstream users subsequently adopted a wait-and-see approach, leading to stabilization and consolidation. However, strong upstream price increases in propylene prompted some plants to suspend external sales, causing the market to shift toward bullish expectations. While operating plants maintained shipments, inventory levels gradually decreased to lower positions. Prices saw continuous slight increases during the holiday. Over the past two days, cautious buying interest picked up, leading to a minor pullback, but propylene prices once again surged above 10,000 yuan/ton, providing support. Combined with essential downstream demand emerging after the holiday, trading activity improved today. As of Thursday, October 8, mainstream spot cash ex-factory prices in Shandong were quoted at 10,900–11,000 yuan/ton.
Within the period, PO operating rates increased: overall units remained largely stable, resulting in higher output. On the cost side, propylene prices trended upward while liquid chlorine rebounded and then consolidated, meaning representative processes operated at a loss. Regarding demand, northern regions maintained normal trading activity during the holiday, while southern markets primarily relied on contract deliveries. On the first day post-holiday, various parties showed some essential demand follow-through, and end-users also provided feedback indicating continued purchasing interest.
Looking ahead, raw material propylene is expected to remain at high levels, while liquid chlorine will likely consolidate with slight weakness, maintaining reasonable cost-side support. On the supply side, some maintenance shutdowns are anticipated in the north, reducing volumes, along with scheduled maintenance in South China, leading to lower overall output. Downstream demand may see some essential follow-up purchases after the holiday; however, combined with market sentiment regarding upcoming PO plant maintenance and crude oil volatility, short-term demand may hold steady but could weaken persistently thereafter. The market is currently viewed as moderately bullish, likely trending upward before entering a phase of consolidation and negotiation.
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