Import homo-PP to China softened, no drastic movement expected

Since Chinese players returned from the National Day holidays during early October, demand in the country has been picking up in a surprisingly rate, pushing prices up. For the past two weeks, import homo-PP prices for Middle Eastern origins below the $1050/ton threshold technically disappeared; in addition to the upcoming major plants shutdown, giving traders great hope for further price increment. However, unsupportive demand and upstream market has diverted the situation slightly.

This week, import prices below the $1050/ton market started to emerge again as traders are encouraged to give discounts to entice demand. CommoPlast data show that import homo-PP prices for both Middle Eastern and USA origins dropped $10/ton week on week basis.

A trader offered USA homo-PP injection at $1020-1030/ton CFR China, LC 90 days term informed, “Prices are lower, and so the demand. Our customers are taking a serious view on the shipping time despite supply tightness, which clearly demonstrated the lack of confidence in near term outlook.”

Another trader purchased Middle Eastern homo-PP at $1040/ton CFR China, LC AS term said, “We added another $20-25/ton margins reselling to local buyers, however the resistance is too stiff. Bids prices are no higher than $1055/ton and we are considering the situation now.”

Many players are delaying their purchase decisions to monitor the result of the USA presidential election, which market believed that would have significant impact on the financial sector. At the meantime, no expectation for drastic price reduction has been brought up, given the lack of inventories pressure at the supplier’s side. A market source added, “We think sellers would only offer some discounts on deals, especially when propylene costs are firming up now.”

Import homo-PP to China currently stand at $1020-1070/ton CFR China, LC 0-90 days term.