PP plant operating rate returns to low

Recently, more and more plants shut for maintenance, some shut on schedule, and some shut accidentally. The overall operating rate of PP once again dropped to a low level, currently close to 80%, and it is not difficult to find that it is already a low point of the year. Meanwhile, the overall operating rate of PP in 2022 is generally lower than that of the same period last year, which is closely related to the production cut of petrochemical plants under high cost pressure.

It can be seen that since July, there are only few sets of PP plants restarted, while more and more plants shut for maintenance. PP plant operating rate declines.

Some plants are scheduled to shut for maintenance in July. For example, Shaanxi Yanchang plans to shut for maintenance since mid Jul for around one-and-a-half-month, and Zhongan Lianhe plans to shut for maintenance in late Jul for around 45days. But the actual implementation of maintenance still needs to be tracked. In addition, in recent years, it is frequent that plants shut accidentally, which also needs timely attention.

In addition to the operating rate, the production ratio of homo PP raffia has also dropped to an all-time low of nearly 20% recently. On the one hand, some plants such as Qinghai Yanhu, Haiguolongyou, Hebei Haiwei and so on mainly produce homo PP raffia, the shutdown of these plants has a significant impact on the loss of homo PP raffia output. On the other hand, some plants have switched their production from homo PP raffia to others, such as Yangtz River Petrochemical, Zhongan Lianhe, Sinochem Quanzhou II, etc.

If the production ratio of homo PP raffia continues to remain low, the impact of the reduction in raffia supply on the market will gradually increase, which is expected to support and boost the market to a certain extent. However, there is still a lot of uncertainty about whether the current production ratio of raffia can be maintained at a low level for a long time.