- Local PP Homo Raffia offers decreased significantly on October 29
- Shenzhen Juzhengyuan’s new PP lines have started production
- PP prices will be under pressure due to additional supply
As the market had just resumed after the Golden Week holiday, SSESSMENTS.COM’s team noted that on October 8, the local offers for PP Homo Raffia were adjusted down between CNY50-100/ton ($7-14/ton) following the decreases in the futures market. In the third week of October, the local offers for PP Homo Raffia hiked up by CNY50-100/ton ($7-14/ton) in line with the firmer futures prices. Moving to the beginning of the week commencing October 21, the offers were trimmed between CNY50-100/ton ($7-14/ton) as the futures prices softened. However, as the futures market showed increases since Tuesday night, October 22, traders initiated an increase in spot offers a day after between CNY50-100/ton ($7-14/ton).
On October 29, the local offers for PP Homo Raffia were adjusted down twice within the same day with a total reduction of CNY250/ton ($35.5/ton) compared to offers on October 28, SSESSMENTS.COM was told. Sources stated that the adjustments on local offers were made to trim the wide gap between spot and futures prices after the decreases in the futures market.
In the import market, the offers for Indian PP Homo Raffia cargoes decreased between $10-20/ton compared to the last trading day on September 30. By the week commencing October 14, offers for Middle Eastern cargoes were recorded stable to decrease between $10-20/ton while offers from an Indian petrochemical producer dropped $25/ton, all compared to a week earlier. Sources added to SSESSMENTS.COM that the deals for dutiable cargoes, such as Middle Eastern cargoes were concluded at $1,000/ton on LC at sight, CIF China Main Port basis in the fourth week of October. Moving to the final week, import Indian PP Homo Raffia offers decreased by $10/ton from a week earlier.
After the Golden Week holiday, SSESSMENTS.COM was told that the demand remained slow. However, by the third week of October, the buying sentiment for PP showed a slight improvement as supported by the loosened trade tension between China and the U.S although the procurements kept on an as-needed basis. Moving to the fourth week, the buying sentiment softened again as buyers drew concern on the progress of the new PP plants inside and outside China since the additional supply will put pressure on PP prices.
On the production side, market sources informed SSESSMENTS.COM that Shenzhen Juzhengyuan has already brought the new PP plant no.1 with a capacity of 300,000 tons/year on-stream during the National Day holiday. On October 28, sources informed that Shenzhen Juzhengyuan’s new PP line no. 2 with a capacity of 300,000 tons/year has been brought on-stream as well.
Looking ahead, market sources opined that PP prices in China will be under pressure as the supply is predicted to outpace demand, SSESSMENTS.COM was told.
Tags: Asia Pacific,China,English,EN PP CHINA MSS,MonthlySSESSMENTS,Northeast Asia,Polypropylene (PP) China PP Prices,PP pricesNovember 22, 2019 6:34 PM