Indonesian buyers seek import non-dutiable PP cargoes as local market strengthens

During the early trading hours on the 14 January, Indonesian buyers reported purchasing locally held homo-PP yarn cargoes at IDR16,600,000/ton ($1178/ton) without VAT, FD Indonesia – the level that disappeared right after the deals. At the time this report is published, no yarn cargoes at below the IDR17,000,000/ton ($1206/ton) mark are observed in the spot ground.

Firmer local market has stimulated trading activities in the import front to a certain extent now that buyers opt to scout for competitive non-dutiable homo-PP cargoes.

“We have sold 3000 tons of Vietnamese material in the price range $1110-1120/ton CIF Indonesia, LC AS. At the moment, we have lifted offers by $20/ton. Buyers started to show some resistance but for us, inventories pressure is not high,” a regional trader reported.

Another international trader reportedly sold out Philippines homo-PP cargoes at $1110/ton with the same term to Indonesia late last week and has not opened new price list for this week. “We are thinking to maintain new offers on the stable to firmer levels. Our concern is the post-Lunar New Year holiday outlook,” the source added.

There have been speculations that if demand for non-dutiable homo-PP cargoes in Indonesia continues to pick up in the coming days, the general sentiment across the region might be elevated. This is because most Middle Eastern suppliers have already adopted a firm stance on the cargoes and it appeared that the sales pressure was on Southeast Asian sellers prior to this.

“With a better opportunity to deplete more cargoes, we think Southeast Asian suppliers have little incentive to cut prices any further. There is a high chance that Asian PP market might regain some strength before the holiday kick-start, especially with the current firm condition in China,” said, an international trader.