As stated to SSESSMENTS.COM, the leading Indian petrochemical producer has officially announced Mid-August shipment offers for PP Homo Raffia to the Asia market this week. On a weekly basis, the producer announced higher offers to all markets as crude oil prices have rebounded off record lows on stabilizing fuel demand prospects. As compared to the offer level available in mid-June, current offers to the Southeast Asia market are largely on a stable to $10/ton higher on the high-end of the price range. Similarly, the producer’s offers to the China market were adjusted up by $10/ton in comparison to the level seen three weeks earlier. To the South Asia market, current offers edged up by $20/ton from a fortnight ago.
Regarding the response, the producer told SSESSMENTS.COM that feedback from buyers in China and Southeast Asia is in contrast with South Asia. As informed, the producer received lukewarm responses from the customers in China and Southeast Asia. The producer concludes limited deals as buyers were concerned over the sharp price increase in a short period of time. Considering the current market situation, most buyers in Vietnam and Indonesia posed a strong resistance toward higher offers above $920/ton-level for PP Homo Raffia. Further added, customers in Vietnam prefer to halt procurement activities, citing that most companies are still holding onto sufficient stocks after securing some volumes in the past few months to cover production needs. Besides, concern over the second wave of coronavirus weighed heavily on sentiment, driving customers to retreat to the sidelines. Moreover, the producer opined that most market participants in Southeast Asia are currently keeping an eye on China market development, the biggest polymers market, on post-Dragon Boat Festival holiday before taking the next decision. Speaking of shipment, the producer mentioned that the company does not have any issues in arranging shipment to other countries despite the recent border clash between India and China that could spark a military conflict.
In South Asia, current offers have drawn largely positive responses from buyers in Bangladesh and Sri Lanka, even though offers from mainstream Middle Eastern producers were heard at $970/ton, or at the similar level as the producer’s price list. So far, the Indian producer managed to close some deals in Sri Lanka and Bangladesh market at $10/ton from the initial offer level. However, most customers in Bangladesh found difficulties to complete the transactions due to banking issues. Amid ongoing lockdown, most banks in Bangladesh are not fully operational, even some already closed branches temporarily, SSESSMENTS.COM was informed.
