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QuarterlySSESSMENTS: Q2 2020 SEA PP Prices

Author: SSESSMENTS

  • Import PP Homo Film offers recorded an increase of triple digits in June
  • Concern over coronavirus outbreak dented market sentiment
  • Pricing outlook firm on tight supply, a further price increase remains feasible

As coronavirus began its relentless march around the globe, this pandemic has sent ripples of shock waves across Southeast Asian PP markets, sources reported to SSESSMENTS.COM. During the second quarter of 2020, Southeast Asia’s domestic and import PP prices were largely taking cues from global crude oil futures as more signs of the global spread of the coronavirus heightened fears of a pandemic, which could thwart fuel demand. In April, local PP prices in Southeast Asia went on a rollercoaster ride, as news of the coronavirus continued to paint a dire picture. In Malaysia, April delivery offers for PP Homopolymer and Copolymer grades from the local producer lowered between MYR350-800/ton ($82-187/ton) compared to March. In Thailand, offers for PP Homopolymer grades from the local producers were mostly captured on a downtrend during the first half of April, with a total reduction of between THB500-1,000/ton ($16-32/ton). However, on the week commencing April 20, Thai producers adjusted up the offers for PP across all grades by THB1,500/ton ($48/ton) on a weekly basis as the producers managed to sell big quantities to domestic and export markets. Meanwhile, the leading Philippines polyolefins producer refused to provide pricing quotes to the domestic market in April, chose to selectively offer cargoes if there were inquiries from buyers. From the import market, most sellers set off a round of price cuts amid a hammering of markets by coronavirus pandemic and a sharp slump in crude oil prices to multi-year lows. Overall, Southeast Asia’s import PP prices in April gained a cumulative decrease of $50/ton.

In May, SSESSMENTS.COM was informed that local PP offers in Southeast Asia showed different trends each week. In Malaysia, May delivery offers for PP Homopolymer grades from the leading Malaysian polyolefins producer were unchanged as compared to April, while offers for PP Copolymer grades were down by MYR250-260/ton ($58-61/ton) compared to the same period. Whereas in Thailand, local producers quoted higher offers for PP Homopolymer grades to the domestic market in May, with a range of increase between THB500-1,000/ton ($16-32/ton) week by week, mainly fuelled by tight supply concerns. From the import market, Southeast Asia’s import PP prices in May gained a cumulative increase of between $20-40/ton. In response to sharp gains in import prices, most buyers in the region were holding back their purchases in anticipation of greater falls in prices, mainly due to a large drop in demand in domestic and export destination countries driven by the pandemic crisis. 

Southeast Asia’s domestic and import PP prices gained ground in June as crude oil prices bounced up from the historic April lows, coupled with tight availability of spot cargoes. In Malaysia, June delivery offers for PP Homopolymer and Copolymer grades from a local producer edged higher between MYR100-280/ton ($23-65/ton) compared to May. In the Philippines, local PP offers from the leading polyolefins producer on the week commencing June 8 increased between PHP1,000-2,000/ton ($20-40/ton). Whereas in Thailand, offers for PP Homopolymer grades from the local producers were mostly captured on an uptrend during June, with a range of increase between THB500-2,000/ton ($16-64/ton) week by week. From the import market, July shipment offers for PP Homo Film from a Middle Eastern producer surfaced with a significant increase as much as $130/ton on a monthly basis. Detailed information for Indonesia and Vietnam market is available in QuarterlySSESSMENTS of the respective countries. 

Southeast Asia PP market continued to face strong headwinds in Q2 2020, with coronavirus still dominating as a key factor in the market. The market was hit hard by coronavirus shutdowns that started sweeping the region in the late February and early March, derailing entire sectors of the economy and decimating consumer spending. In April, overall buying sentiment was sluggish, weighed down by market players' concerns on how the spread of the lethal virus could affect trade flows and have an effect on global prices. Besides, the biggest drop in crude oil prices also pushed the market into a slowdown and led to rising uncertainties. Despite a steady increase in coronavirus cases in some parts of the region, Southeast Asian countries have begun easing its lockdown in a phase-wise manner from early May. Even though most countries were taking a gradual approach to lifting restrictions, sources pointed out that some downstream factories were still struggling to keep their operating rate at normal levels amid weak end-users demand for finished products. In the second half of May, activity in Malaysia and Indonesia market remained muted, with limited spot trades taking place as the majority of market players were away from their desks for Eid Al-Fitr celebration. In June, concerns that the second wave of coronavirus infections was hitting the region as it emerged from lockdown, with buyers purchasing on a hand-to-mouth basis only, and unwilling to build inventories amid worsening economic outlook. Further added, as the rally in crude oil prices has sent most commodities prices spiralling upward, some buyers in the region started showing a strong resistance toward higher offers as no strong demand fundamentals to support any form of price hikes. 

On plant news, Thailand’s Integrated Refinery Petrochemical Complex (IRPC) took its PP line no. 3 and no. 4 off-stream in the middle of June. The producer’s PP line no. 3 remained closed for maintenance work from June 12 until June 26. Upon the completion of maintenance at PP line no. 3, the producer also underwent a maintenance shutdown at its PP line no. 4 starting from June 29 and expected to be back on-stream in mid-July. Located in Rayong Province, Thailand, PP line no. 3 and no. 4 have a production capacity of 225,000 tons/year and 160,000 tons/year, respectively.

Entering the third quarter of 2020, market participants in Southeast Asia voiced out to SSESSMENTS.COM that the coronavirus pandemic will continue to weigh heavily on overseas and domestic demand, considering raising fears over a second wave of the coronavirus following a spike in untraceable local infections and imported cases in the region. Although the coronavirus pandemic continues to take a toll on demand, some sources expect that PP prices will continue its upward trend, citing limited availability of spot cargoes.

Transactions for local/localized PP in April on FD basis, excluding VAT (except in PHP including 12% VAT, all equivalent in USD excluding VAT)

OriginProductTransaction TypeCurrencyOffers/tonEquivalent in USD/tonPayment TermDelivery Country
MalaysiaPP Block CopolymerPrice ListMYR4,060-4,380948-1,02330 Days Credit TermMalaysia
MalaysiaPP Homo FilmOffer GivenMYR3,95092230 Days Credit TermsMalaysia
MalaysiaPP Homo FilmPrice ListMYR3,95092230 Days Credit TermMalaysia
ThailandPP Homo FilmOffer GivenTHB27,500-30,500884-980Cash In AdvanceThailand
ThailandPP Homo FilmOffer GivenTHB28,500-29,000916-93230 Days Credit TermThailand
ThailandPP Homo FilmOffer ReceivedTHB26,500-30,000851-964Cash In AdvanceThailand
ThailandPP Homo FilmPurchasedTHB27,000-31,000868-996Cash In AdvanceThailand
ThailandPP Homo FilmSell IdeaTHB29,000932Cash In AdvanceThailand
MalaysiaPP Homo RaffiaOffer GivenMYR3,80088730 Days Credit TermMalaysia
MalaysiaPP Homo InjectionPrice ListMYR3,75087630 Days Credit TermMalaysia
Southeast AsiaPP Homo InjectionOffer GivenPHP62,000-65,0001,120-1,174Cash In AdvancePhilippines
ThailandPP Homo InjectionOffer GivenTHB27,000-30,000868-964Cash In AdvanceThailand
ThailandPP Homo InjectionOffer GivenTHB28,000-28,500890-91630 Days Credit TermThailand
ThailandPP Homo InjectionOffer ReceivedTHB26,000-28,500835-916Cash In AdvanceThailand
ThailandPP Homo InjectionSoldTHB27,500-28,500884-916Cash In AdvanceThailand
MalaysiaPP Homo RaffiaOffer ReceivedMYR3,600841Cash In AdvanceMalaysia
MalaysiaPP Homo RaffiaPrice ListMYR3,800-4,650887-1,08630 Days Credit TermMalaysia
MalaysiaPP Homo RaffiaPurchasedMYR3,600-4,600841-1,074Cash In AdvanceMalaysia
MalaysiaPP Homo RaffiaPurchasedUSD815-Cash In AdvanceMalaysia
PhilippinesPP Homo RaffiaOffer GivenPHP67,001,210Cash In AdvancePhilippines
Southeast AsiaPP Homo RaffiaOffer GivenPHP62,00-65,0001,120-1,174Cash In AdvancePhilippines
ThailandPP Homo RaffiaBuy IdeaTHB27,500-28,000884-89030 Days Credit TermThailand
ThailandPP Homo RaffiaOffer GivenTHB26,500-30,000851-964Cash In AdvanceThailand
ThailandPP Homo RaffiaOffer GivenTHB28,000-28,500890-91630 Days Credit TermThailand
ThailandPP Homo RaffiaOffer ReceivedTHB26,000-29,500835-948Cash In AdvanceThailand
ThailandPP Homo RaffiaSell IdeaTHB28,500916Cash In AdvanceThailand
ThailandPP Homo RaffiaSoldTHB27,500-28,500884-916Cash In AdvanceThailand
MalaysiaPP Random Copolymer ExtrusionPrice ListMYR4,360-5,2701,018-1,23130 Days Credit TermMalaysia
ThailandPP Random Copolymer InjectionOffer GivenTHB33,500-34,5001,076-1,109Cash In AdvanceThailand

Transactions for import PP in April on LC at sight, CIF Main Port basis

OriginProductTransaction TypeOffers (USD/ton)Delivery Location
Southeast AsiaPP Block CopolymerOffer Received950Southeast Asia
Middle EastPP Homo FilmOffer Received800Thailand
Middle EastPP Homo FilmPurchased800Thailand
Southeast AsiaPP Homo RaffiaOffer Received850-880Philippines
Southeast AsiaPP Homo RaffiaSold890Philippines
Middle EastPP Homo RaffiaOffer Received790Myanmar
Southeast AsiaPP Homo RaffiaOffer Received810Thailand
Southeast AsiaPP Homo RaffiaOffer Given800-850Southeast Asia
Southeast AsiaPP Homo RaffiaOffer Received800Malaysia

Transactions for local PP in May on FD basis, excluding VAT (except in PHP including 12% VAT, all equivalent in USD excluding VAT)

OriginProductTransaction TypeCurrencyOffers/tonEquivalent in USD/tonPayment TermDelivery Country
MalaysiaPP Block CopolymerPrice ListMYR4,060-4,230946-98530 Days Credit TermMalaysia
MalaysiaPP Homo FilmOffer GivenMYR3,95092230 Days Credit TermMalaysia
MalaysiaPP Homo FilmPrice ListMYR3,95092230 Days Credit TermMalaysia
ThailandPP Homo FilmBid ReceivedTHB28,000890Cash In AdvanceThailand
ThailandPP Homo FilmBuy IdeaTHB26,500851Cash In AdvanceThailand
ThailandPP Homo FilmOffer GivenTHB28,500-31,500916-1,012Cash In AdvanceThailand
ThailandPP Homo FilmOffer ReceivedTHB28,500-31,500916-1,012Cash In AdvanceThailand
ThailandPP Homo FilmOffer ReceivedTHB31,00099630 Days Credit TermThailand
ThailandPP Homo FilmPurchasedTHB28,250908Cash In AdvanceThailand
ThailandPP Homo FilmSell IdeaTHB27,500-28,000884-890Cash In AdvanceThailand
MalaysiaPP Homo InjectionPrice ListMYR3,75087630 Days Credit TermMalaysia
Southeast AsiaPP Homo InjectionOffer GivenPHP62,000-65,0001,120-1,174Cash In AdvancePhilippines
ThailandPP Homo InjectionBid ReceivedTHB27,500884Cash In AdvanceThailand
ThailandPP Homo InjectionOffer GivenTHB27,250-30,500876-980Cash In AdvanceThailand
ThailandPP Homo InjectionOffer ReceivedTHB30,000-30,500964-980Cash In AdvanceThailand
ThailandPP Homo InjectionPurchasedTHB28,000890Cash In AdvanceThailand
ThailandPP Homo InjectionSell IdeaTHB27,000-27,500868-884Cash In AdvanceThailand
ThailandPP Homo InjectionSoldTHB28,000-28,500890-916Cash In AdvanceThailand
MalaysiaPP Homo RaffiaOffer GivenMYR4,08095330 Days Credit TermMalaysia
MalaysiaPP Homo RaffiaOffer ReceivedMYR3,750-4,130876-96430 Days Credit TermMalaysia
MalaysiaPP Homo RaffiaPrice ListMYR3,800-3,850887-89930 Days Credit TermMalaysia
MalaysiaPP Homo RaffiaPurchasedMYR3,65085230 Days Credit TermMalaysia
PhilippinesPP Homo RaffiaOffer GivenPHP67,0001,210Cash In AdvancePhilippines
Southeast AsiaPP Homo RaffiaOffer GivenPHP62,000-65,0001,120-1,174Cash In AdvancePhilippines
ThailandPP Homo RaffiaBid ReceivedTHB27,500884Cash In AdvanceThailand
ThailandPP Homo RaffiaBuy IdeaTHB26,000835Cash In AdvanceThailand
ThailandPP Homo RaffiaOffer GivenTHB27,250-30,500876-980Cash In AdvanceThailand
ThailandPP Homo RaffiaOffer ReceivedTHB28,000-30,500890-980Cash In AdvanceThailand
ThailandPP Homo RaffiaSell IdeaTHB27,000-27,500868-884Cash In AdvanceThailand
ThailandPP Homo RaffiaSoldTHB28,000-29,500890-948Cash In AdvanceThailand
MalaysiaPP Random Copolymer ExtrusionPrice ListMYR4,360-5,1901,018-1,21230 Days Credit TermMalaysia

Transactions for import PP in May on LC at sight, CIF Main Port basis

OriginProductTransaction TypeOffers (USD/ton)Delivery Location
Southeast AsiaPP Block CopolymerOffer Received920Philippines
Middle EastPP Homo FilmOffer Received890Philippines
Middle EastPP Homo FilmPrice List910Philippines
Southeast AsiaPP Homo FilmOffer Received890-900Philippines
Middle EastPP Homo InjectionPrice List910Philippines
Southeast AsiaPP Homo InjectionOffer Received850-870Philippines
Middle EastPP Homo RaffiaPrice List880Philippines
Middle EastPP Homo RaffiaOffer Received850-860Myanmar
Southeast AsiaPP Homo RaffiaOffer Received850-870Philippines
Southeast AsiaPP Homo RaffiaOffer Given850-870Southeast Asia
Southeast AsiaPP Homo RaffiaSold900Southeast Asia
Middle EastPP Random Copolymer InjectionPrice List1,020Philippines

Transactions for local PP in June on FD basis, excluding VAT (except in PHP including 12% VAT, all equivalent in USD excluding VAT)

OriginProductTransaction TypeCurrencyOffers/tonEquivalent in USD/tonPayment TermDelivery Country
MalaysiaPP Block CopolymerOffer GivenMYR4,4401,03730 Days Credit TermMalaysia
MalaysiaPP Block CopolymerPrice ListMYR4,440-4,5101,037-1,05330 Days Credit TermMalaysia
MalaysiaPP Homo FilmOffer ReceivedMYR4,230-4,290988-1,00230 Days Credit TermMalaysia
MalaysiaPP Homo FilmPrice ListMYR4,5501,06230 Days Credit TermMalaysia
PhilippinesPP Homo FilmOffer ReceivedPHP62,000-63,0001,120-1,138Cash In AdvancePhilippines
PhilippinesPP Homo FilmPurchasedUSD1,000-Cash In AdvancePhilippines
ThailandPP Homo FilmOffer GivenTHB34,000-37,0001,092-1,189Cash In AdvanceThailand
ThailandPP Homo FilmOffer ReceivedTHB32,000-36,0001,028-1,157Cash In AdvanceThailand
ThailandPP Homo FilmSoldTHB29,500948Cash In AdvanceThailand
MalaysiaPP Homo InjectionOffer GivenMYR4,030-4,350941-1,01330 Days Credit TermMalaysia
MalaysiaPP Homo InjectionPrice ListMYR4,030-4,350941-1,01330 Days Credit TermMalaysia
PhilippinesPP Homo InjectionOffer ReceivedPHP60,000-61,0001,084-1,102Cash In AdvancePhilippines
ThailandPP Homo InjectionOffer GivenTHB30,500-37,000980-1,189Cash In AdvanceThailand
ThailandPP Homo InjectionOffer ReceivedTHB32,000-35,5001,028-1,141Cash In AdvanceThailand
ThailandPP Homo InjectionSoldTHB29,000-30,500932-980Cash In AdvanceThailand
MalaysiaPP Homo RaffiaOffer GivenMYR4,080-4,130953-96430 Days Credit TermMalaysia
MalaysiaPP Homo RaffiaPrice ListMYR4,080-4,450953-1,03730 Days Credit TermMalaysia
MalaysiaPP Homo RaffiaPurchasedMYR4,3001,004Cash In AdvanceMalaysia
MalaysiaPP Homo RaffiaSoldMYR4,080953Cash In AdvanceMalaysia
PhilippinesPP Homo RaffiaOffer ReceivedPHP60,000-62,0001,084-1,12060 Days Credit TermPhilippines
PhilippinesPP Homo RaffiaOffer ReceivedPHP60,000-61,0001,084-1,102Cash In AdvancePhilippines
PhilippinesPP Homo RaffiaPurchasedUSD950-Cash In AdvancePhilippines
ThailandPP Homo RaffiaOffer GivenTHB30,500-36,000980-1,157Cash In AdvanceThailand
ThailandPP Homo RaffiaOffer ReceivedTHB31,500-36,0001,012-1,157Cash In AdvanceThailand
ThailandPP Homo RaffiaOffer ReceivedTHB33,5001,07630 Days Credit TermThailand
ThailandPP Homo RaffiaSoldTHB29,000-30,500932-980Cash In AdvanceThailand
MalaysiaPP Random Copolymer ExtrusionPrice ListMYR4,820-5,4701,126-1,27730 Days Credit TermMalaysia

Transactions for import PP in June on LC at sight, CIF Main Port basis

OriginProductTransaction TypeOffers (USD/ton)Delivery Location
Middle EastPP Block CopolymerOffer Received950Myanmar
Southeast AsiaPP Block CopolymerSold980-990Southeast Asia
Indian SubcontinentPP Homo FilmOffer Received890Thailand
Middle EastPP Homo FilmOffer Received990Philippines
Southeast AsiaPP Homo FilmOffer Received1,020Philippines
Middle EastPP Homo RaffiaOffer Received865-880Myanmar
Southeast AsiaPP Homo RaffiaSell Idea900Southeast Asia
Southeast AsiaPP Homo RaffiaSold920Southeast Asia
Southeast AsiaPP Homo RaffiaSold960-980Philippines

Tags: Asia Pacific,English,PP,Quarterly,SEA

Published on July 7, 2020 3:25 PM (GMT+8)
Last Updated on September 18, 2020 1:00 PM (GMT+8)