Import homo-PP to China firm up on healthy buying interest

After a week of continuous rising futures prices that stimulated trading activities in both local and import ground, suppliers for Saudi Arabia’s homo-PP decided to lift their offers by $30-40/ton compared to last week, reaching $1060-1080/ton CFR China, LC 0-90 days term on the first trading day of this week.

With such hike, the gap between spot and futures market is now narrowed to about CNY100/tom ($15/ton), which caused some reluctance among cargoes takers. An international trader commented after opened new offering said, “Our customers are still considering whether to make purchases at the new levels. We are confident about the deals. We think with the current futures and crude oil prices, market would hold firm in the near term.”

A converter received new homo-PP offers at $1080/ton CFR China, a $40/ton increased from last week added, “It looks like the PP market might remain on the firming track in the coming weeks, hence we are planning to increase our end product prices in order to cover the high input costs.”

While several others are questioning the sustainability of the current trend, pointing to the thin margins manufactures have; the general expectation is that market might continue to rise in the near term, as long as the gap between spot and futures market is attractive enough for traders.

Import homo-PP to China currently stands at $1060-1140/ton CFR China, LC 0-90 days term.