Print

The Southeast Asian market starts the new week with calm sentiment as a number of major players are away for ChinaPlas Exhibition. However, several major suppliers decided to open new offers with $10-20/ton increased on import homo-PP to the region followed the plan in the previous week. Transaction is thin at the latest prices and buyers are still having doubt about the sustainability of this development.

A Vietnamese buyer reported receiving Thailand homo-PP at $20/ton hike from last week to $1290/ton CIF, LC AS term, said, “We did not place any bid though there have been strong indications that market would remain firm throughout May. Our question is whether this trend could sustain in June given the long Ramadan holiday in this month as well as it is the traditional off-peak season.” 

In Indonesia, Saudi homo-PP yarn has achieved deals at $1260/ton CIF, LC AS term – the level that buyers rejected last week. “We have suspended all offerings and might implement further increases in the coming week. Demand is not strong, however constantly tight availability for Middle Eastern cargoes might encourage buyers to make replenishment,” an international trader informed.

Another international trader reported to have diverted most of the Philippines homo-PP cargoes to Vietnam market from Indonesia due to better demand condition here while Thailand cargoes emerged at $1330-1355/ton CIF Indonesia, LC AS term. “Many of our customers are still hoping for a reduction in the current market condition, which is very unlikely to take place in the near term. We have not opened any new offers due to ChinaPlas, however, we have every intention to lift the new offers,” another international trader added.

Limited supply stemming from a series of plant shutdown and strong upstream costs are elevating the PP market, yet, it does make sense for buyers to concern about the medium-term outlook. Besides the long Ramadan holiday in Muslim markets, most of the scheduled turnaround would also resume production by June, which might ease the supply condition to a certain extent. Vietnam’s Nghi Son Refinery and Petrochemical is on track to bring its 370,000 tons/year PP unit on stream by then.