A sales representative of a Chinese PP producer informed SSESSMENTS.COM that China PP prices have returned to reasonable levels with the help of government intervention. Local coal-based PP Homo Raffia cargo was sold at CNY7,100/ton ($1,003/ton), maintained stable from a day earlier after previously dropped as much as CNY1,000/ton ($141/ton) as compared to last week. The trader also informed on purchasing localized PP Homo Raffia cargoes of Vietnam origin at CNY6,800-6,900/ton ($960-974/ton) on the same payment and delivery terms, citing such a level is quite attractive. For local PP Homo Fiber cargoes, this week buying sentiment is gradually fading, but last week the company still can sell the product at CNY20,000/ton ($2,822/ton). All offers on cash, EXW China basis and including 13% VAT.
As the Chinese government recently announced to control price gouging on the commodity market, the market becomes more rational and PP Homo Fiber prices started to cool down. The government announced will be seriously investigating and prosecuting unqualified converters who do not have certifications to do standard productions. The trader said to SSESSMENTS.COM that most of the converter’s orders for mask and medical protection suits have been booked until June, so the PP producers allocated 49% of their company total productions to produce PP Homo Fiber to fulfil demand. In the past, the producers only allocated around 10% of their production capacity to produce PP Homo Fiber, but as the demand for masks and other medical productions is striking amid Coronavirus pandemic, they switch productions. However, the trader believes this condition would not last long since more and more converters are gradually switching back their productions to PP Homo Raffia. The China PP market is expected to back to normal coming towards May.
Click below to view related stories and content on the China PP market:
DailySSESSMENTS: China PP Price 23rd April 2020
NewsSSESSMENTS: Updates On Local PE, PP Prices In China Market April 23
NewsSSESSMENTS: Source: Local PE, PP Offers In China Retreated Below Threshold Level
