Import homo-PP to Vietnam extended firming trend despite lacking demand support

Major overseas suppliers continue implementing small to moderate hike on import homo-PP to Vietnam this week regardless of the demand condition. Data from CommoPlast showed the average value for import homo-PP to the country gained $10/ton week on week with most prices are hovering in the low $1300/ton at the moment.

It is interesting that buyers are not showing the eager to scout for material despite the loud and wide intention of lifting prices overseas sellers announced in the previous week. “Market is hitting the record high this year and we have no confidence in making purchases at such point in time. It is the traditional slow demand season, not only in Vietnam, but also in the nearby China market, and we think there shall be some correction ahead,” a buyer commented.

A major Saudi Arabia producer enthusiastically lifting June shipment offers by $40/ton from last month to $1310/ton CIF Vietnam, LC AS term claiming limited sales pressure due to healthy sales results in other markets, including India, Pakistan and South Africa. “We do not expect any immediate deal at the new prices but rather collecting bids for further decision. Supply is tight while upstream costs are firm, and we hope buyers would be more active,” a source close to the producer said.

Transaction throughout the week is rather disappointed even for a Saudi cargo that is facing a shortage in the local ground. The maker lifted offers by $10/ton this week, bringing the latest levels to $1300/ton CIF Vietnam, LC AS term. A number of buyers are placing bids at $1280/ton with the same term and currently waiting for supplier’s feedback. “Import prices are too high now while the local ground is not catching up. The near-term outlook is so uncertain and we prefer to be conservative,” another buyer said.

The firm stance from Middle Eastern suppliers is drawing the price gap between dutiable and non-dutiable cargoes closer, or in fact, at the moment, this gap does not present. Import cargoes from Thailand and China, which are not subjected to the 3 percent tariffs, are ranging $1315-1330/ton, and if deals were to materialise at the offered levels, it would still be more competitive. 

“And we see there is a cap on the current uptrend and we prefer to adopt wait and see stance,” another market source said.