In the second half of April, the propylene glycol market showed high volatility and a gradual decline in focus, mainly due to loose costs and weak demand, with tight spot prices limiting the decline. As of April 29th, the average production price of propylene glycol in Shandong region was 10633 yuan/ton, with a cumulative decrease of 7% in half a month.
fundamental analysis
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Cost side: High level decline in propylene oxide (PO), weakened support
Geopolitical easing, PO supply recovery, price decline, business social epoxy propane prices fell by more than 11.5% during the cycle, and propylene glycol cost support loosened.
Supply side: Production has rebounded, spot prices are tight but the increase is limited
Domestic construction: The industry’s construction rate has rebounded from less than 60% to 65-70%, and the early maintenance equipment has been gradually restarted. Inventory: Factory inventory is low, traders’ inventory is not high, and manufacturers’ willingness to raise prices still exists.
Demand side: Stable demand, high prices suppress procurement
Unsaturated resin: The demand for essential materials remains stable, but downstream customers are cautious in receiving goods at high prices. There are many small orders for essential materials, and overall demand growth is limited. Lithium battery electrolyte: Demand is supported and long-term orders are stable, but high prices suppress the enthusiasm for spot purchases. Polyether polyols: The market is weak, the supply is sufficient, manufacturers are promoting orders at low prices, and there is insufficient willingness to follow up.
Market forecast:
Overall, it is highly likely that propylene glycol will maintain a high and narrow range of fluctuations in the short term. However, with the continuous weakening of cost support and multiple pressures such as high prices suppressing procurement, the price will gradually face downward pressure, and the center of gravity in the medium and long term may slowly shift downwards. It is necessary to pay attention to the raw material market.
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