A global trading house revealed to SSESSMENTS.COM that most foreign producers are attempting to raise their offers to the China market this week as crude oil prices extended their gains amid signs of improving demand, sending monomer prices skyrocketing. As compared to last week’s level, a South Korean producer applied a price increase of $30/ton for PP Block Copolymer and PP Random Copolymer Blow, available in the market at $970/ton and $1,020/ton respectively on LC at sight, CIF China Main Port basis. However, most customers regarded the offer level as high. For Middle Eastern origin, a Saudi producer has also adjusted up offers for PP Homo Raffia cargoes by $30/ton as compared to the same period, surfaced in the market at $890/ton with the same payment and delivery terms.
Despite a rebound in crude oil prices and higher propylene costs, the majority of converters in China are holding back their purchases and are keeping low inventory level due to falling export and domestic orders. The trader also mentioned that uptrend in feedstocks and monomer prices, coupled with relatively low domestic inventory level has provided support to the spot market. Further added, recovery in export demand has yet to take place even though most countries have loosened its lockdown measures. “We foresee that export demand will start to recover once manufacturers in other countries are gradually resuming operations from months-long closure over the Coronavirus pandemic,” the trader voiced out to SSESSMENTS.COM.
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