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Weak demand at home and intense competition overseas pushes Zhongjing Petrochemical to step back on export PP offers for the second time this week while leaving room for negotiations with serious buyers.

The latest offers from the producer and changes from the previous offers are as follows:

In China, trading activities on the Shenhua auction platform have been sluggish throughout the week while key contracts on the Dalian Commodity Exchange fall under the pressure of a global economic slowdown. While the basic demand is still present, sources said that transactions are not strong enough to help draw down local stocks at the desirable rates.

“We started seeing more Chinese cargoes priced below the $1000/ton threshold based on CIF terms this week. Given the global economic conditions, we fear that the downtrend might extend to the coming week,” commented, a Vietnamese buyer.

Background:

Fujian Zhongjing Petrochemical is a subsidiary of China Soft Packaging Group Holdings Limited – a leading BOPP packaging products manufacturer in China. The company ventured into the upstream sector by building its first PP plant in 2012 and has been actively planning to expand the capacity since then.

Existing plants include two PP lines with a nameplate capacity of 1 million tons/year and a 750,000 tons/year propane dehydrogenation (PDH) unit based in Fujian, China. 

In 2018, the company signed a contract to use LyondellBasell’s 5th Generation Spheripol technology to build a new PP line with an estimated annual output of 1.2 million tons/year. The new plant is scheduled to come online between late 2022 to early 2023. 

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