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WeeklySSESSMENTS: Indonesia PP Prices Week Starting June 8

Author: SSESSMENTS

Indonesian Converters Under Predicament Due To Finite Supply For PP Resins

  • Last week’s trend in local PP prices persist as expected
  • Buyers prefer import cargoes over local due to stronger Rupiah
  • Supply shortage expected to foot holding PP prices from falling despite slow demand

Some Indonesian converters are under predicament due to finite supply for PP resins, citing that the supply issues have led to higher prices; which could not be accepted by most converters as demand for end-products remains sluggish. On the week starting June 8, SSESSMENTS.COM noted that the upward trend in PP prices is still prolonged as expected. In the local market, the new price list for PP Homopolymer and Copolymer grades from the leading Indonesian polyolefins producer surfaced with an increment of between IDR120,000-290,000/ton ($8-20/ton) on a weekly comparison. Meanwhile, another Indonesian PP producer decided to maintain the offers stable for PP Homo Injection and PP Homo Raffia but increased the offers for PP Homo Film by IDR50,000/ton ($3/ton) as compared to a week earlier. For localized cargoes, a converter received offers for Southeast Asian PP Homo Raffia from the largest local trading house in the country at IDR14,600,000/ton ($1,037/ton) on cash, FD Indonesia basis and excluding 10% VAT, or IDR100,000/ton ($7/ton) higher than last Thursday’s level. 

In the import market, a converter reported to SSESSMENTS.COM on receiving Saudi PP Homo Film offers at $950/ton and submitted bids at $50/ton lower than the initial offer levels. However, the bids were rejected since the supplier is only willing to sell above $900/ton-level. Another converter received import offers for PP Homo Raffia of various origins; one of them is from Thailand at $1,000/ton, such a high level was offered owing to limited allocation. For Middle Eastern PP Homo Raffia cargoes, the converter managed to close deals at $870/ton from one of the producers, but when the converter requested for additional volume, the producer informed that the cargoes were no longer available. Eventually, the converter decided to conclude deals with another Middle Eastern producer at $30/ton higher than the previous deals. For India origin, offers for PP Homo Raffia stand at $850/ton but since the shipment will be in August, the converter is uninterested in purchasing the cargoes. All offers are on LC at sight, CIF Indonesia Main Port basis. Additionally, some Indonesian buyers recently prefer import cargoes over local on the back of stronger local currency. 

In general, demand for PP resins in Indonesia is considered good this week. Not because buying sentiment has improved significantly but because of the low to zero availability of materials, especially for Homopolymer grades, from either local and foreign suppliers. On the other side, some suppliers who still have allocations are raising their offers; which makes the prices unworkable for buyers considering demand for end-product that has yet to show improvement. Due to this, buyers reported facing difficulties in securing PP cargoes. On the supply front, SSESSMENTS.COM noted that there are no significant issues except for tight supply for PP Homopolymer grades in the Indonesia market.

Looking ahead, the majority of Indonesian market players contacted by SSESSMENTS.COM believe that local and import PP prices will likely continue on an upward trend at least until the end of June supported by supply factor. On the contrary, demand for PP resins has a low chance to improve as buyers are still cautious in making procurement due to sluggish sales for finished products.

Local/localized PP offers on cash, FD Indonesia basis and excluding 10% VAT in all terms

OriginProductTransaction TypeOffers (IDR/ton)Equivalent in USD/tonPayment Term
IndonesiaPP Block CopolymerPrice List15,290,0001,086Cash In Advance
IndonesiaPP Homo FilmOffer Given15,450,0001,09715 Days Credit Term
IndonesiaPP Homo FilmOffer Received15,600,0001,108Cash In Advance
IndonesiaPP Homo FilmOffer Received15,500,0001,10115 Days Credit Term
IndonesiaPP Homo FilmOffer Received14,750,000-15,000,0001,048-1,06530 Days Credit Term
IndonesiaPP Homo FilmPrice List15,450,0001,097Cash In Advance
ThailandPP Homo FilmOffer Received15,200,0001,08015 Days Credit Term
IndonesiaPP Homo InjectionOffer Given14,600,0001,03715 Days Credit Term
IndonesiaPP Homo InjectionPrice List14,620,0001,038Cash In Advance
IndonesiaPP Homo RaffiaOffer Given14,600,0001,03715 Days Credit Term
IndonesiaPP Homo RaffiaOffer Received14,600,0001,037Cash In Advance
IndonesiaPP Homo RaffiaOffer Received14,000,00099430 Days Credit Term
IndonesiaPP Homo RaffiaPrice List14,620,0001,038Cash In Advance
Southeast AsiaPP Homo RaffiaOffer Received14,300,000-14,600,0001,016-1,03730 Days Credit Term
IndonesiaPP Random Copolymer InjectionPrice List17,050,000-17,520,0001,211-1,244Cash In Advance

Import PP offers on LC at sight, CIF Indonesia Main Port basis

OriginProductTransaction TypeOffers (USD/ton)
Far East AsiaPP Block CopolymerOffer Given950
Southeast AsiaPP Block CopolymerOffer Given970
Far East AsiaPP Homo FilmOffer Received950
Middle EastPP Homo FilmOffer Received950
Middle EastPP Homo FilmBid Given900
Far East AsiaPP Homo RaffiaOffer Received930
Indian SubcontinentPP Homo RaffiaOffer Given920-925
Indian SubcontinentPP Homo RaffiaOffer Received930
Indian SubcontinentPP Homo RaffiaOffer Received850*
Middle EastPP Homo RaffiaOffer Received900-930
Middle EastPP Homo RaffiaPurchased870-900
Middle EastPP Homo RaffiaSold880
Southeast AsiaPP Homo RaffiaOffer Received940-1,000
Southeast AsiaPP Homo RaffiaSold900
Description: *Offers for August shipment

Tags: Asia Pacific,English,Indonesia,PP,SEA,Weekly

Published on June 10, 2020 12:54 PM (GMT+8)
Last Updated on June 10, 2020 2:18 PM (GMT+8)