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As a number of regional and international PP plants enter the maintenance shutdown season during the first quarter 2017, players across the Asia market are expecting PP prices to sustain the stable to firm trend in the coming month, despite the fact that post Lunar New Year period usually poses weaker demand condition.

The following table shows the scheduled turn around at several major PP plants:

Market sources also reported that UAE’s Borouge is planning a month long maintenance shutdown at one of its PP lines during February and March period, however, it is still unconfirmed which production line would be taken off-stream. At the meantime, a source close to the producer informed about tight availability at the moment due to an on going unspecified issue at the plant.

Fueled by the expected tightening supply throughout this quarter, the bullish outlook seems to have a solid support from the supply side. On the other hand, demand prospect remains questionable. A Chinese trader commented, “Many converters have yet to received new end product orders, therefore the uncertainties is high.”

In addition, the current global economic and political condition has also casted shadow on the general market sentiment. Players are raising concern over the possible policies changes by the USA’s new president that might hurdle the trade flow. Not to mention that Chinese government is planning to tighten monetary policies in 2017 and extend effort to prune excess industrial capacity, which in turn might cause a slower growth.

A market sources informed, “It is difficult to determine the winning side in this tug of war. While supply might be curtailed, demand has equal role in justifying the trend. At the moment, we only buy on need basis to avoid the risks and also partially due to lack of quantity from the suppliers.”