Vietnamese players: Import homo-PP seems stabilising

Since late January, import homo-PP prices to Vietnam has been escalating on the back of tightening supply and strong upstream costs, accumulating of more than $90/ton hike on an average. However, over the past week, players here are reporting signs of a stabilising market despite a strong week-on-week gain in propylene prices.

One of the factor players attributed to such development is the active re-export cargoes from near-by China market. In fact, since buyers resumed working after the long Lunar New Year holiday; most import offers available in the country are re-export from China, as international producers are yet to give direct prices. A trader commented, “The origins of re-export material are really varied and prices are no higher than the $1160/ton mark. We therefore, feel very concern over the state of demand in China.”

In fact, buying interest in China disappoints many regional players, who were initially expected strong replenishment activities in the post holiday term. Persistent weak purchasing activities and continuous cargoes arrival has cause severe storage issues, which explained to why suppliers here seeks to achieved better margin in nearby Vietnam market.

Another Vietnamese buyer added, “We are not seeing market going down, however, in order for the momentum to regain speed, Chinese buyers must resume restocking activities. At the moment, market is stalled mostly at the level $1160/ton for dutiable cargoes.” Many buyers are expressing similar concern over the state of demand in China, which to them, indicates real price risk if persist any longer.

On the first trading day of the week, several re-export deals for Russian cargoes are reported at $1115/ton CIF Vietnam, LC AS term; however, this is not a major trend given the irregularity of the origin. Import homo-PP to Vietnam currently stand at $1115-1230/ton CIF, LC AS term.