Firmer import market support local homo-PP prices in Indonesia

Following the firmer stance observed in the import homo-PP market in the nearby China and Vietnam market, overseas sellers are refusing to concede to any large discount to Indonesia. Import prices below the $1250/ton CIF for dutiable cargoes have technically disappeared, which supported local ground to a certain extent.

“We finally landed a deal at seller’s level of IDR18,700,000/ton ($1298/ton) without VAT, FD Indonesia, cash term. The supplier is very firm while domestic supply is not high due to the on-going shutdown at Polytama and Pertamina,” a converter informed.

Even the mentioned price level is no longer available toward the end of the week as sellers claimed out of allocation. “We lifted prices by IDR200,000/ton ($14/ton) from earlier this week. We are no longer having locally produced and locally held Thailand materials. Import market is firming up and we have to follow,” a major trader added.

As buyers can no longer negotiate on the prices, many are attempting to ask for more favourable payment term. A buyer explained, “We are not aggressive. Local supply might recover once two major makers restart from the maintenance shutdown. Would the supplier agree to better payment term, we will procure some cargoes.”    

In the import ground, deals for Saudi Arabia homo-PP have been achieved at $1260/ton CIF Indonesia, LC AS while other makers are insisting on the $1270/ton level. 

Trading activities are improving in Indonesia, but yet to meet seller’s expectation. Players are watching out for further development in the China market after the trade war moved to a new level to gauge the sustainability of the current trend. 

Exchange rate: USD 1 = IDR 14,408