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QuarterlySSESSMENTS:Q1 2020 China PP Prices

Author: SSESSMENTS

  • Local PP prices fluctuated during the first quarter of 2020
  • Import PP prices were mostly on a downtrend
  • Coronavirus outbreak negatively impacted PP demand up to the end of Q1 2020

 

SSESSMENTS.COM noted that PP prices in China were under pressure in the first week of Q1 2020 due to the high market inventory. PP Homo Raffia prices at CNY7,400/ton ($1,048/ton) on cash, EXW China basis and including 13% VAT surfaced at this particular time. Then, the sudden surge in crude oil prices after an Iranian military commander was killed in Iraq on January 3, 2020, provided support for a rebound in PP prices. The uptrend lasted for two weeks as in the week commencing January 20, PP prices softened following the decline in futures prices ahead of Chinese New Year Holiday. The downtrend prolonged until the first half of February while from the second half of February to the first week of March, PP prices in the domestic China market increased. The prices were on downtrend once again from the second week of March to the end of the month.

In the import market, the availability of PP Homo Raffia of Russia origin was high during January. Therefore, offers for the cargoes declined to $860/ton on LC at sight, CIF China main port basis. The offer was the lowest level for PP Homo Raffia in the China market in January. In February, import PP Homo Raffia offers were still corrected down as some traders were willing to sell cargoes at a loss to clear out inventory. In the first half of March, import offers were stable on a weekly comparison and the downturn was recaptured in the second half of March. SSESSMENTS.COM data showed that offers and deals at $700/ton-level started to surface in the week commencing March 23. An Indian petrochemical producer slashed offers by $40/ton to $780/ton on LC at sight, CIF China main port basis. Deals for PP Homo Raffia from the leading Indonesian polyolefins producer were concluded at $760/ton with the same payment and delivery term, $40/ton lower than the initial offer level. On March 31, deals for PP Homo Raffia cargoes from India were already at $700/ton on LC at sight, CIF China main port basis.

In general, PP demand in China during the first quarter of 2020 was subdued, SSESSMENTS.COM noted. In January, demand for PP was affected by the Coronavirus outbreak and the Chinese New Year Holiday. Most buyers left early for the holiday while others held procurement activities. In the first half of February, PP demand further weakened as the government imposed travel restrictions. Slight improvements in demand were seen in the second half of the month as manufacturers resumed production activities and gradually increased the operating rate. However, the demand was still considered weak up to the end of March due to the slow end product sales owing to Coronavirus spread globally, significant drops in crude oil prices, and expectation for further decreases in prices. On the supply side, supply for PP during Q1 2020 was ample.

Market players opined to SSESSMENTS.COM that the downtrend in local and import PP prices would continue to the Q2 2020. Import offers to China will head to $600/ton as competition between foreign suppliers is expected to become fiercer. Meanwhile, demand will remain slow amidst the battle against the Coronavirus outbreak globally.

Range of local PP transactions in January on cash, EXW China basis (CNY term includes 13% VAT, all equivalent in USD excludes VAT)

OriginProductTransaction TypeOffers (CNY/ton)Equivalent in USD/ton
ChinaPP Homo FilmOffer Given7,950-8,400996-1,053
ChinaPP Homo InjectionOffer Given7,500-8,700940-1,090
ChinaPP Homo InjectionPrice List8,050-8,7501,009-1,097
ChinaPP Homo InjectionSold8,850-8,9001,109-1,115
ChinaPP Homo RaffiaOffer Given7,400-8,000927-1,003
ChinaPP Homo RaffiaSold7,600-7,650953-959
ChinaPP Homo RaffiaPrice List7,550-7,850946-984
ChinaPP Homo Raffia (CTO)Offer Given7,300-7,500915-940
ChinaPP Homo Raffia (CTO)Sold7,350-7,680921-963
ChinaPP Block CopolymerOffer Given8,300-8,9001,040-1,115
ChinaPP Block CopolymerOffer Received9,100-9,8501,141-1,235
ChinaPP Random Copolymer InjectionPrice List9,400-9,8001,178-1,228
ChinaPP Random Copolymer InjectionOffer Given9,300-9,8501,166-1,235

Range of import PP transactions in January on LC at sight, CIF China Main Port basis

OriginProductTransaction TypeOffers (USD/ton)
Southeast AsiaPP Homo FilmOffer Received1,030-1,050
Far East AsiaPP Homo InjectionOffer Given910
Indian SubcontinentPP Homo InjectionOffer Given915-920
Middle EastPP Homo InjectionOffer Given910-950
Middle EastPP Homo InjectionOffer Received910-920
Middle EastPP Homo InjectionSold910
Southeast AsiaPP Homo InjectionOffer Received1,000-1,020
Central AsiaPP Homo RaffiaOffer Given880-900
Central AsiaPP Homo RaffiaOffer Received860-880
Central AsiaPP Homo RaffiaPurchased880
Central AsiaPP Homo RaffiaSold900
Far East AsiaPP Homo RaffiaOffer Given990-1,020
Indian SubcontinentPP Homo RaffiaOffer Given915-930
Indian SubcontinentPP Homo RaffiaOffer Received930
Indian SubcontinentPP Homo RaffiaBuy Idea900-920
Indian SubcontinentPP Homo RaffiaSold930
Middle EastPP Homo RaffiaOffer Given900-930
Middle EastPP Homo RaffiaOffer Received880-910
Middle EastPP Homo RaffiaPurchased880
Middle EastPP Homo RaffiaSold900-910
South AmericaPP Homo RaffiaOffer Received900
Southeast AsiaPP Homo RaffiaOffer Received940-1,020
Far East AsiaPP Block CopolymerOffer Given980-1,040
Middle EastPP Block CopolymerOffer Given960-1,000
Far East AsiaPP Random Copolymer InjectionOffer Given1,100-1,140
Far East AsiaPP Random Copolymer InjectionOffer Received1,100
Middle EastPP Random Copolymer InjectionOffer Given1,050-1,070

Range of local PP transactions in February on cash, EXW China basis (CNY term includes 13% VAT, all equivalent in USD excludes VAT)

OriginProductTransaction TypeOffers (CNY/ton)Equivalent in USD/ton
ChinaPP Homo FilmOffer Given7,100890
ChinaPP Homo InjectionOffer Given6,750-8,500846-1,065
ChinaPP Homo InjectionPrice List6,950-7,850871-984
ChinaPP Homo InjectionSell Idea6,900865
ChinaPP Homo InjectionSold6,800852
ChinaPP Homo RaffiaOffer Given6,600-7,350827-921
ChinaPP Homo RaffiaOffer Received6,680-7,150837-896
ChinaPP Homo RaffiaSell Idea6,800852
ChinaPP Homo RaffiaSold6,700-7,050840-884
ChinaPP Homo RaffiaPrice List6,700-7,200840-902
ChinaPP Homo Raffia (CTO)Offer Given7,100890
ChinaPP Homo Raffia (CTO)Sold6,900-7,050865-884
ChinaPP Block CopolymerOffer Given7,200-7,700902-965
ChinaPP Random Copolymer InjectionPrice List8,600-9,2001,078-1,153

Range of import PP transactions in February, CIF/CFR China Main Port basis

OriginProductTransaction TypeOffers (USD/ton)Payment Term
Indian SubcontinentPP Homo InjectionOffer Given910LC at sight
Middle EastPP Homo InjectionOffer Given850-855LC at sight
Middle EastPP Homo InjectionOffer Received880LC at sight
Middle EastPP Homo InjectionBid Given840LC at sight
Central AsiaPP Homo RaffiaOffer Given880-890LC at sight
Central AsiaPP Homo RaffiaOffer Given830-840TT
Far East AsiaPP Homo RaffiaOffer Given900-1,010LC at sight
Far East AsiaPP Homo RaffiaOffer Received950LC at sight
Indian SubcontinentPP Homo RaffiaOffer Given870-890TT
Indian SubcontinentPP Homo RaffiaOffer Given880-900LC at sight
Indian SubcontinentPP Homo RaffiaOffer Received900LC at sight
Middle EastPP Homo RaffiaOffer Given870-880TT
Middle EastPP Homo RaffiaOffer Given840-920LC at sight
Middle EastPP Homo RaffiaOffer Received840-980LC at sight
Middle EastPP Homo RaffiaBid Given820LC at sight
Southeast AsiaPP Homo RaffiaPurchased1,080LC at sight
Far East AsiaPP Block CopolymerOffer Given930-1,040LC at sight
Middle EastPP Block CopolymerOffer Received900LC at sight
Southeast AsiaPP Block CopolymerOffer Received1,150LC at sight
Far East AsiaPP Random Copolymer InjectionOffer Given1,050*-1,100LC at sight
Middle EastPP Random Copolymer InjectionOffer Received940LC at sight
Description: *Offers on CFR basis

Export PP offers in February on LC at sight, FOB China basis

OriginProductTransaction TypeOffers (USD/ton)
ChinaPP Homo RaffiaOffer Given880-950
ChinaPP Homo RaffiaOffer Received900*
Description: *Received by Vietnamese buyers

Range of local PP transactions in March on cash, EXW China basis (CNY term includes 13% VAT, all equivalent in USD excludes VAT)

OriginProductTransaction TypeOffers (CNY/ton)Equivalent in USD/ton
ChinaPP Homo FilmOffer Given6,200-6,300777-790
ChinaPP Homo InjectionOffer Given5,800-7,400727-927
ChinaPP Homo InjectionPrice List6,700-7,900840-990
ChinaPP Homo RaffiaOffer Given5,750-7,300721-915
ChinaPP Homo RaffiaSold6,900-7,050865-884
ChinaPP Homo RaffiaPrice List6,500-7,550815-946
ChinaPP Homo Raffia (CTO)Offer Given5,900-6,900739-865
ChinaPP Block CopolymerOffer Given7,400-8,200927-1,028
ChinaPP Random Copolymer InjectionPrice List7,850-9,200984-1,153

Range of import PP transactions in March on LC at sight, CIF/CFR China Main Port basis

OriginProductTransaction TypeOffers (USD/ton)
Far East AsiaPP Homo InjectionOffer Given860-960
Far East AsiaPP Homo InjectionOffer Received800-950
Indian SubcontinentPP Homo InjectionOffer Given870-880
Indian SubcontinentPP Homo InjectionOffer Received870
Indian SubcontinentPP Homo InjectionSold870-880
Middle EastPP Homo InjectionOffer Given710-880
Middle EastPP Homo InjectionOffer Received860-870
Middle EastPP Homo InjectionSold860-870
Southeast AsiaPP Homo InjectionOffer Received840
Far East AsiaPP Homo RaffiaOffer Given860-960
Far East AsiaPP Homo RaffiaOffer Received930-950
Far East AsiaPP Homo RaffiaSold870-900
Indian SubcontinentPP Homo RaffiaOffer Given780-880
Indian SubcontinentPP Homo RaffiaOffer Received780-870
Indian SubcontinentPP Homo RaffiaBuy Idea840-850
Indian SubcontinentPP Homo RaffiaSold700
Middle EastPP Homo RaffiaOffer Given710-880
Middle EastPP Homo RaffiaOffer Received700-960
Middle EastPP Homo RaffiaSold840
Southeast AsiaPP Homo RaffiaOffer Given800-940
Southeast AsiaPP Homo RaffiaOffer Received840-995
Southeast AsiaPP Homo RaffiaBid Received760
Southeast AsiaPP Homo RaffiaPurchased760-800
Far East AsiaPP Block CopolymerOffer Given880-980
Far East AsiaPP Block CopolymerSold900-930
Middle EastPP Block CopolymerOffer Received820-1,030
Southeast AsiaPP Block CopolymerOffer Given990
Southeast AsiaPP Block CopolymerOffer Received890-1,075
Southeast AsiaPP Block CopolymerBid Given1,000
Far East AsiaPP Random Copolymer BlowOffer Given1,010
Middle EastPP Random Copolymer BlowOffer Received880
Southeast AsiaPP Random Copolymer BlowOffer Given1,060
Far East AsiaPP Random Copolymer InjectionOffer Given1,050
Middle EastPP Random Copolymer InjectionOffer Received1,060
Southeast AsiaPP Random Copolymer InjectionOffer Received1,125

Export PP offers in March on LC at sight, FOB China basis

OriginProductTransaction TypeOffers (USD/ton)
ChinaPP Homo RaffiaOffer Given860

Tags: Asia Pacific,China,English,NEA,PP,Quarterly

Published on April 8, 2020 9:51 AM (GMT+8)
Last Updated on April 8, 2020 9:52 AM (GMT+8)