Buyers In China Still Adopt Same Buying Patterns Despite Adjustment On PP Prices
As informed to SSESSMENTS.COM, most buyers in China still adopt the same buying patterns despite the adjustment on PP prices. On the week commencing June 1, both local and import PP offers across all grades captured on an upward trend. Local traders adjusted up local PP Homo Raffia offers by CNY100/ton ($14/ton) on a weekly comparison following the firmer futures prices. While for local PP Homo Injection and PP Random Copolymer Injection, the latest offers are available between CNY100-300/ton ($14-42/ton) higher compared to offers on Monday, June 1. As noted, September 2020 PP futures on the Dalian Commodity Exchange increased CNY358/ton ($50/ton) week on week, settling at CNY7,493/ton ($1,053/ton) by Tuesday (June 2) settlement.
In the import market, offers for Vietnamese PP Homo Raffia and PP Homo Injection cargoes increased by $90/ton compared to three weeks ago. So far, no deals concluded as the current offers deemed too high. While for Middle Eastern PP Homo Raffia, some re-exporters expressed buy idea between $830-850/ton on LC at sight, CIF China Main Port basis for prompt delivery. As for other grades, SSESSMENTS.COM pricing database showed that offers for Thai PP Random Copolymer Injection moved up between $30-40/ton on a weekly comparison. Likewise, June shipment offers for PP Block Copolymer of South Korea origin increased by $50/ton compared to a fortnight ago.
Despite the uptrend in PP prices, no improvement was seen in PP demand so far. Buyers showed resistance towards current prices and only purchased on a hand-to-mouth basis as demand for the finished product remains slow. However, a producer stated to SSESSMENTS.COM that as some countries have eased lockdown and reopened businesses, orders at the producer’s end have been picked up gradually. On the supply side, on Wednesday, June 3, the inventory level of the two leading Chinese polyolefins producers stood at 740,000 tons, a reduction of 85,000 tons from Monday’s level.
Chinese market players believe that taking the slow demand into account, local and import PP prices will only be hovering within the current level in the near term. However, as more countries reopen businesses, orders for finished products from China will improve, which is expected to lift PP demand as well, as stated to SSESSMENTS.COM.
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Local PP offers on cash, EXW China basis (including 13% VAT in CNY term and excluding VAT in USD term)
Import PP offers on LC at sight, CIF China Main Port basis
Description: *June shipment offers **Buy idea from re-exporters for prompt delivery cargoesTags: Asia Pacific,China,English,NEA,PP,Weekly
Published on June 3, 2020 2:32 PM (GMT+8)
