Polypropylene enters H2 2026 at approximately $1,180/tonne, up 5% year-over-year, as global demand grows 4% to 85 Mt. PP is the third-most produced plastic after PE and PVC, with applications spanning packaging, automotive, and textiles.
Chinese PP capacity is expanding 8% to 38 Mt, with Sinopec, CNPC, and private refiners the dominant producers. However, Chinese PP imports remain at 5 Mt due to specialty grade demand.
Propylene feedstock costs at $950/t represent 70% of PP production costs. The propylene-PP spread has averaged $200-250/t, sufficient for producer margins.
Recycled PP (rPP) is gaining market share at 8% of total PP consumption, driven by brand owner sustainability commitments. Food-grade rPP commands a 40-60% premium over virgin resin.
Price projections for H2 2026 cluster at $1,100-1,300/t.
PP buyers should secure H2 requirements at $1,150-1,250/t through fixed contracts. Propylene costs provide a price floor. For converters, consider rPP blending where food-contact regulations permit. Budget $1,100-1,350/t for 2027.