The propylene market traded hot this week, and price increases also expanded. Some factories even saw panic buying while factories sold at high prices. Zhuo Chuang believes that the three main factors driving the price increase in the propylene market are high crude oil prices, insufficient supply in the region and the approach of the New Year, and downstream factories are more enthusiastic about purchasing.

In most cases, the influencing factors of propylene are no more than three aspects: crude oil, supply and demand. So let's take a look at these three aspects and why the propylene market is so great.

Although the end of the year is approaching, the propylene plant is relatively large and there are no special circumstances. There is no production holiday during the Spring Festival. According to Zhuochuang information, some propylene plants have reduced production due to equipment problems, and the equipment has been reduced by about 200 tons per day. In addition, this week's rain and snow weather extended the transportation time of goods from this region to Shandong; this week, the port volume of propylene was relatively small. There is only about one propylene ship, and traders are not very active in shipping. As a result, most downstream plants primarily source nearby, with low propylene inventories at surrounding refineries, and some plants even have current production and sales.

According to reports, some powder mills have reduced their load production, and purchasing demand has decreased by about 1,000 tons/day, but the price of powder is relatively high, which is favorable for propylene. Some powder plants actively source from neighboring plants, while other downstream plants also need to maintain raw material inventories. Downstream purchasing demand is strong, and some factories have signs of inventory.

Since most downstream factories did not have a holiday during the Spring Festival, increasing inventories before the holiday has become a big benefit to support the rise in propylene market prices. Currently, most propylene plants have low inventories, external inventories are tight, and there is less propylene supply in the region. However, Bohua Petrochemical's plan to start the car in February also had a negative impact on market sentiment. On the demand side, despite the intention of downstream inventories, at the current price, the profit of powder factories is relatively weak, and the terminal demand of powder is declining, which makes it difficult to continue to grow. Therefore, support for propylene prices is limited. However, octanol and propylene oxide plants have inventory needs ahead of the holidays. Therefore, both the upstream and downstream markets are in a stalemate, and propylene plants need to maintain low inventory operations ahead of the holiday, so the propylene market should remain stable. Zhuochuang predicts that the market price of propylene is expected to fluctuate around 8,500 yuan/ton before the festival.