PP prices stayed high in Q2 amid tight supply caused by two core factors. Widespread maintenance of major refinery facilities dragged the industry operating rate below 70%. Meanwhile, escalating geopolitical conflicts boosted feedstock costs; some producers cut operating rates or suspended production on losses, while several new PP projects were postponed to Q3. Contrary to expectations of output expansion, Q2 saw constrained supply.
A sharp supply surge is expected across July-September. Major idle plants will resume operation from late June. Over 3 million tons of new PP capacities in East, South and Northeast China are scheduled to come online. Easing geopolitical tensions will lower international feedstock prices and improve import profitability, bringing more inbound cargoes. The three supply increments will converge in Q3.
Market performance hinges on downstream demand and feedstock cost fluctuations. Traditional end-user sectors including woven plastic, BOPP and injection molding lack robust orders, and summer off-season limits demand improvement; existing rigid demand can hardly absorb new supplies. Resurgent geopolitical risks may lift costs to offset supply pressure, yet such scenario is unlikely under current trends.
In short, plant maintenance and geopolitics propped up PP market in H1 and offset surplus pressure. With these supports fading in Q3 from restored old capacities and newly-launched production lines, PP pricing will shift from cost-driven to supply-demand-driven, and inventory changes will dictate future price trends and industrial capacity consolidation.
Post time: Jun-05-2026