1、 Price trend

This week, the domestic propane market continued to decline by a large margin. On February 24, the average price of propane market was 4062.5 yuan / ton, and on February 28, the average price was 3717.5 yuan / ton, down 8.49% in the week, down 7.18% compared with the same period last year.

2、 Analysis of influencing factors

Product: this week, the domestic propane market continued to decline, with a large margin, and the market transaction atmosphere turned weak. As of February 28, Shandong Dongming Petrochemical Co., Ltd. stopped using propane for its own use, and Shandong Haiyou Petrochemical Group Co., Ltd. had no propane in stock, so it was not offered temporarily. The ex factory price of propane of Tianjin Bohai Chemical Group supply and marketing company is 3650 yuan / ton, that of Shandong Dongying Hualian Petrochemical Co., Ltd. is 3600 yuan / ton, that of Shandong HSBC Petrochemical Co., Ltd. is 3770 yuan / ton, that of Shandong Hengyuan Petrochemical Co., Ltd. is 3700 yuan / ton, that of Shandong Binzhou Dayou group is 3650 yuan / ton, and that of Sinopec Qingdao refining Co., Ltd The factory price of propane is 3800 yuan / ton.

This week, propane showed a continuous downward trend. Although the early downstream demand has increased, coupled with high-speed free, there are many replenishment operations in this favorable situation. However, affected by the global epidemic warming, crude oil continued to decline sharply this week, with a negative market mentality and a more cautious and wait-and-see mentality in the downstream. This week, the price of civil gas is also mainly downward. In March, CP price is expected to fall, and terminal consumption has not been fully recovered. Under multiple negative conditions, the market transaction atmosphere turns weak, the manufacturer’s late shipment is not smooth, the inventory gradually rises, and the price continues to fall.

Saudi Aramco issued CP in February, with propane of 505 US dollars / ton, down 60 US dollars / ton compared with the previous month; butane of 545 US dollars / ton, down 45 US dollars / ton compared with the previous month.

Industry: according to the price monitoring of the business agency, in the list of commodity prices rising and falling in the eighth week of 2020 (2.24-2.28), there are 14 kinds of commodities in the chemical industry sector, among which there are 2 kinds of commodities with an increase of more than 5%, accounting for 2.3% of the number of commodities monitored in the sector; the top 3 commodities are sulfur (18.44%), liquid ammonia (7.51%) and ammonium chloride (2.44%). There are 29 commodities with a decline of 5% or more, accounting for 2.3% of the monitored commodities in the sector; the top three products with a decline are propane (- 8.49%), epichlorohydrin (- 7.81%) and R134a (- 5.00%). This week’s average was – 0.33%.

3、 Future forecast

At present, the terminal market has not been fully recovered, and the market demand is limited. In addition, the international crude oil has fallen sharply. In March, the CP price is expected to fall. Multiple negative factors affect the market mentality. The atmosphere for manufacturers to ship goods has been weakened, and the inventory is increasing. It is expected that the market trend will continue to be weak in the short term.