- Sharp fluctuations in PP prices were seen in April
- Demand for PP in Q2 2020 was weak
- Two local producers will start-up PP unit in July
Based on the data gathered by SSESSMENTS.COM, China PP prices fluctuated in Q2 2020. Sharp fluctuations were seen in April as four digits adjustments were applied on local offers on a day interval. At the beginning of the week commencing April 13, local PP offers increased significantly. The cumulative increases of offers for PP Homo Raffia and PP Homo Injection were CNY1,800-2,000/ton ($256-284/ton) and CNY2,300/ton ($327/ton), respectively. Factors causing such increases were firmer futures prices, stronger crude oil prices, reduced supply as some producers switched production to PP Homo Fiber, bullish buying sentiment, and speculation of traders. On April 15, local offers for PP Homo Raffia dropped between CNY1,000-1,500/ton ($142-213/ton) from levels a day earlier due to softer futures prices coupled with unsupportive demand from downstream customers. On the first day of the week commencing April 20, local PP Homo Raffia offers were reported at CNY50-500/ton ($7-71/ton) lower than a week earlier. Then, after crude oil prices dropped to negative territory on April 21, another reduction of CNY1,000/ton ($142/ton) was applied.
On the first trading day in May after the Labor Day holiday (May 6), local PP offers increased between CNY100-400/ton ($14-57/ton) compared to levels recorded before the holiday. A week later, local PP offers were on a downtrend again. In the second half of May, local PP offers in China found momentum to move higher once again supported by limited supply and higher feedstock costs. The increments were between CNY100-200/ton ($14-28/ton) on a weekly comparison. A similar pattern of price movements was seen in June, SSESSMENTS.COM noted. In the first week of the month, local PP Homo Raffia offers went up by CNY100/ton ($14/ton) from the previous week following increases in the futures market. In the following week, local PP Homo Raffia and PP Homo Injection prices were adjusted down between CNY100-600/ton ($14-85/ton). In the second half of June, local PP offers increased slightly, by CNY50/ton ($7/ton) in the third week and between CNY25-50/ton ($3-7/ton) in the fourth week on a weekly comparison.
Similar to local offers, a spike in import PP Homo Raffia offers were seen in the week commencing April 13. Offers for PP Homo Raffia from a Saudi producer were adjusted up by $100/ton while offers for PP Homo Raffia of Vietnam origin increased between $150-160/ton on a weekly comparison. In the last week of the month, the falloff in the offers was recorded. Offers for PP Homo Raffia of Vietnam origin decreased by $120/ton from two weeks earlier. In May and June, import PP offers to China mostly moved upward supported by limited supply and firm monomer and crude oil prices. June shipment PP offers from a Malaysian producer surfaced with an increase of $30-40/ton while July shipment offers from the same producer increased between $30-80/ton on a monthly comparison. On June 22, SSESSMENTS.COM was informed that July shipment offers for PP Block Copolymer from a South Korean producer surfaced with a significant increase of $100/ton compared to June shipment offers.
In general, the actual demand for PP in the second quarter of 2020 was weak since transactions recorded during price uptrend were mostly done by hedgers. Most converters were still running below the normal production rates due to slow sales. Converters enjoying satisfactory sales and run at maximum capacity were mask converters only. SSESSMENTS.COM was told that among all converters in China, only around 20% are mask manufactures. Moreover, concern over the second wave of the COVID-19 outbreak dragged down demand for PP further down. On June 13, the Beijing government reimposed lockdown following new cases of COVID-19 infections. On the supply side, domestic supply for PP was tight during the quarter, particularly for PP Homo Raffia because some producers switched to produce other PP grades, mostly to PP Homo Fiber. On the plant news, SSESSMENTS.COM was told that Liaoning Baolai Petrochemical planned to conduct a trial run at its two PP lines on July 20, 2020. Each line has a capacity of 300,000 tons/year. Likewise, Zhongke Petrochemical also scheduled to start up its new PP units in July. The producer’s two PP units with a total capacity of 550,000 tons/year are located in Zhanjiang, Guangdong Province, China.
Entering Q3 2020, some market players contacted by SSESSMENTS.COM predict that PP prices in China will remain firm supported by high propylene prices and tight supply. However, some others foresee that due to the low season for PP in July and the arrival of a considerable volume of import cargoes in the same month, there might be slight downward corrections on PP offers. Moreover, there will be additional supply from the new start-up PP plants in the country.
Range of local/localized PP transactions in April on cash, EXW China basis (including 13% VAT in CNY term, excluding VAT in USD term)
| Origin | Product | Transaction Type | Offers (CNY/ton) | Equivalent in USD/ton) |
|---|
| China | PP Block Copolymer | Offer Given | 6,100-9,000 | 767-1,132 |
| China | PP Block Copolymer | Offer Received | 8,600-9,360 | 1,082-1,177 |
| China | PP Homo Film | Price List | 7,366 | 927 |
| China | PP Homo Injection | Price List | 6,500-10,350 | 818-1,302 |
| China | PP Homo Injection | Offer Given | 6,900-8,500 | 868-1,069 |
| China | PP Homo Raffia | Offer Given | 6,100-9,500 | 767-1,195 |
| China | PP Homo Raffia | Price List | 6,300-11,500 | 793-1,447 |
| Vietnam | PP Homo Raffia | Purchased | 6,800-6,900 | 855-868 |
| China | PP Homo Raffia (CTO) | Offer Given | 8,700-8,800 | 1,094-1,107 |
| China | PP Homo Raffia (CTO) | Sold | 6,830-8,750 | 859-1,101 |
| China | PP Random Copolymer Injection | Price List | 7,650-9,500 | 962-1,195 |
Range of import PP transactions in April, CIF/CFR China Main Port basis
| Origin | Product | Transaction Type | Offers (USD/ton) | Payment Term |
|---|
| Far East Asia | PP Block Copolymer | Offer Given | 850*-890* | LC at sight |
| Far East Asia | PP Block Copolymer | Offer Received | 800 | LC at sight |
| Far East Asia | PP Block Copolymer | Bid Given | 810 | LC at sight |
| Far East Asia | PP Block Copolymer | Sold | 780-850* | LC at sight |
| Far East Asia | PP Block Copolymer | Sold | 800 | LC 30 Days |
| Middle East | PP Block Copolymer | Offer Received | 800*-830* | LC at sight |
| Southeast Asia | PP Block Copolymer | Offer Received | 850-1,050 | LC at sight |
| Southeast Asia | PP Block Copolymer | Purchased | 760-910 | LC at sight |
| Southeast Asia | PP Block Copolymer | Sold | 850 | LC at sight |
| Far East Asia | PP Homo Film | Sold | 730** | LC at sight |
| Southeast Asia | PP Homo Film | Offer Given | 875 | LC at sight |
| Southeast Asia | PP Homo Film | Sold | 835 | LC at sight |
| Far East Asia | PP Homo Injection | Offer Given | 800-860* | LC at sight |
| Far East Asia | PP Homo Injection | Bid Given | 730 | LC at sight |
| Far East Asia | PP Homo Injection | Purchased | 810 | LC at sight |
| Far East Asia | PP Homo Injection | Sold | 730-**860 | LC at sight |
| Indian Subcontinent | PP Homo Injection | Offer Received | 770***-880 | LC at sight |
| Middle East | PP Homo Injection | Offer Given | 770 | LC at sight |
| Middle East | PP Homo Injection | Offer Received | 760-780 | LC at sight |
| North America | PP Homo Injection | Offer Received | 810 | LC 90 Days |
| Southeast Asia | PP Homo Injection | Offer Received | 820**-880 | LC at sight |
| Southeast Asia | PP Homo Injection | Sold | 800-880 | LC at sight |
| Far East Asia | PP Homo Raffia | Offer Given | 800-850* | LC at sight |
| Far East Asia | PP Homo Raffia | Offer Received | 680-760 | LC at sight |
| Far East Asia | PP Homo Raffia | Bid Given | 730 | LC at sight |
| Far East Asia | PP Homo Raffia | Purchased | 680 | LC at sight |
| Far East Asia | PP Homo Raffia | Sold | 750-810* | LC at sight |
| Indian Subcontinent | PP Homo Raffia | Offer Received | 770*** | LC at sight |
| Indian Subcontinent | PP Homo Raffia | Purchased | 685 | LC at sight |
| Indian Subcontinent | PP Homo Raffia | Sold | 830 | LC at sight |
| Indian Subcontinent | PP Homo Raffia | Sold | 830 | LC 90 Days |
| Indian Subcontinent | PP Homo Raffia | Sold | 725 | LC 30 Days |
| Middle East | PP Homo Raffia | Offer Given | 710-800 | LC at sight |
| Middle East | PP Homo Raffia | Offer Received | 770*-900 | LC at sight |
| Middle East | PP Homo Raffia | Purchased | 810 | LC at sight |
| Middle East | PP Homo Raffia | Sold | 740 | LC 60 Days |
| North America | PP Homo Raffia | Offer Received | 810 | LC 90 Days |
| North America | PP Homo Raffia | Bid Given | 800 | LC 90 Days |
| Southeast Asia | PP Homo Raffia | Offer Given | 830-840 | LC at sight |
| Southeast Asia | PP Homo Raffia | Offer Received | 800-980 | LC at sight |
| Southeast Asia | PP Homo Raffia | Buy Idea | 800 | LC at sight |
| Southeast Asia | PP Homo Raffia | Purchased | 870*** | LC at sight |
| Southeast Asia | PP Homo Raffia | Sold | 740-800 | LC at sight |
| Southeast Asia | PP Random Copolymer Injection | Sold | 960* | LC at sight |
| Far East Asia | PP Random Copolymer Blow | Offer Given | 980 | LC at sight |
| Far East Asia | PP Random Copolymer Blow | Offer Received | 900-995 | LC at sight |
| Far East Asia | PP Random Copolymer Blow | Sold | 900-990 | LC at sight |
| Middle East | PP Random Copolymer Blow | Offer Received | 850-860 | LC at sight |
Description: *May shipment **Offers on CFR basis ***June shipment
Range of local/localized PP transactions in May on cash, EXW China basis (including 13% VAT in CNY term, excluding VAT in USD term)
| Origin | Product | Transaction Type | Offers (CNY/ton) | Equivalent in USD/ton) |
|---|
| China | PP Homo Injection | Price List | 7,800-9,050 | 981-1,138 |
| China | PP Homo Injection | Offer Given | 7,300-8,000 | 918-1,006 |
| China | PP Homo Raffia | Offer Given | 7,300-8,000 | 918-1,006 |
| China | PP Homo Raffia | Price List | 7,300-8,800 | 918-1,107 |
| China | PP Homo Raffia | Sold | 7,200-8,000 | 906-1,006 |
| Vietnam | PP Homo Raffia | Sold | 7,200* | 906 |
| China | PP Homo Raffia (CTO) | Offer Given | 7,300-7,350 | 918-925 |
| China | PP Homo Raffia (CTO) | Sold | 7,400-7,420 | 931-933 |
| China | PP Random Copolymer Blow | Offer Given | 8,100-9,100 | 1,019-1,145 |
| China | PP Random Copolymer Injection | Offer Given | 8,900 | 1,120 |
| China | PP Random Copolymer Injection | Price List | 7,800-8,700 | 981-1,094 |
Description: * Offers on TT
Range of import PP transactions in May, CIF/CFR China Main Port basis
| Origin | Product | Transaction Type | Offers (USD/ton) | Payment Term |
|---|
| Far East Asia | PP Block Copolymer | Offer Given | 860-890* | LC at sight |
| Far East Asia | PP Block Copolymer | Offer Received | 940*-1,000 | LC at sight |
| Far East Asia | PP Block Copolymer | Sold | 850-890 | LC at sight |
| Middle East | PP Block Copolymer | Offer Received | 860**-1,040 | LC at sight |
| Southeast Asia | PP Homo Film | Buy Idea | 850 | LC at sight |
| Far East Asia | PP Homo Injection | Offer Given | 860** | LC at sight |
| Indian Subcontinent | PP Homo Injection | Offer Received | 850* | LC at sight |
| Indian Subcontinent | PP Homo Injection | Sold | 825 | LC 90 Days |
| Middle East | PP Homo Injection | Offer Given | 870 | LC at sight |
| Middle East | PP Homo Injection | Offer Received | 830-990 | LC at sight |
| Southeast Asia | PP Homo Injection | Offer Received | 850-895 | LC at sight |
| Far East Asia | PP Homo Raffia | Offer Given | 860** | LC at sight |
| Indian Subcontinent | PP Homo Raffia | Offer Given | 800-830 | LC at sight |
| Indian Subcontinent | PP Homo Raffia | Offer Received | 800***-860 | LC at sight |
| Indian Subcontinent | PP Homo Raffia | Purchased | 785-800*** | LC at sight |
| Indian Subcontinent | PP Homo Raffia | Sold | 835 | LC 90 Days |
| Middle East | PP Homo Raffia | Offer Given | 820-865 | LC at sight |
| Middle East | PP Homo Raffia | Offer Received | 810**-990 | LC at sight |
| Middle East | PP Homo Raffia | Buy Idea | 800-805 | LC at sight |
| Middle East | PP Homo Raffia | Purchased | 800 | LC at sight |
| North America | PP Homo Raffia | Offer Received | 810-825 | LC at sight |
| South America | PP Homo Raffia | Offer Received | 790 | LC at sight |
| Southeast Asia | PP Homo Raffia | Offer Given | 850*-880* | LC at sight |
| Southeast Asia | PP Homo Raffia | Offer Received | 850-870* | LC at sight |
| Southeast Asia | PP Homo Raffia | Sold | 850 | LC at sight |
| Far East Asia | PP Random Copolymer Injection | Offer Given | 910 | LC at sight |
| Far East Asia | PP Random Copolymer Injection | Offer Received | 995-1,000* | LC at sight |
| Far East Asia | PP Random Copolymer Injection | Sold | 900 | LC at sight |
| Southeast Asia | PP Random Copolymer Injection | Offer Received | 1,000 | LC at sight |
| Far East Asia | PP Random Copolymer Blow | Offer Given | 980*-1,020 | LC at sight |
| Far East Asia | PP Random Copolymer Blow | Offer Received | 990** | LC at sight |
| Middle East | PP Random Copolymer Blow | Offer Given | 920 | LC at sight |
| Middle East | PP Random Copolymer Blow | Offer Received | 920**-1,090 | LC at sight |
Description: *June shipment **Offers on CFR basis ***July Shipment
Range of local PP transactions in June on cash, EXW China basis (including 13% VAT in CNY term, excluding VAT in USD term)
| Origin | Product | Transaction Type | Offers (CNY/ton) | Equivalent in USD/ton) |
|---|
| China | PP Homo Injection | Price List | 7,800-8,600 | 981-1,082 |
| China | PP Homo Injection | Offer Given | 7,750-8,150 | 975-1,025 |
| China | PP Homo Raffia | Offer Given | 7,650-8,150 | 962-1,025 |
| China | PP Homo Raffia | Price List | 7,600-8,150 | 956-1,025 |
| China | PP Homo Raffia (CTO) | Offer Given | 7,630 | 960 |
| China | PP Homo Raffia (CTO) | Sold | 7,850-7,860 | 988-989 |
| China | PP Random Copolymer Injection | Price List | 7,900-8,700 | 994-1,094 |
Range of import PP transactions in June, CIF China Main Port basis
| Origin | Product | Transaction Type | Offers (USD/ton) | Payment Term |
|---|
| Far East Asia | PP Block Copolymer | Offer Given | 940*-990** | LC at sight |
| Far East Asia | PP Block Copolymer | Offer Received | 920*-940* | LC at sight |
| Far East Asia | PP Block Copolymer | Sold | 940*-970** | LC at sight |
| Middle East | PP Block Copolymer | Offer Given | 950**-970** | LC at sight |
| Middle East | PP Block Copolymer | Offer Received | 950**-1,080 | LC at sight |
| Southeast Asia | PP Block Copolymer | Offer Given | 1,000** | LC at sight |
| Southeast Asia | PP Block Copolymer | Offer Received | 1,070 | LC at sight |
| Southeast Asia | PP Block Copolymer | Sold | 980 | LC at sight |
| Middle East | PP Homo Film | Offer Received | 980 | LC at sight |
| Central Asia | PP Homo Injection | Offer Received | 860-870 | LC at sight |
| Far East Asia | PP Homo Injection | Offer Given | 950** | LC at sight |
| Indian Subcontinent | PP Homo Injection | Offer Given | 890-900 | TT |
| Indian Subcontinent | PP Homo Injection | Offer Received | 910**-920** | LC at sight |
| Middle East | PP Homo Injection | Offer Given | 900**-920** | LC at sight |
| Middle East | PP Homo Injection | Offer Received | 930 | LC at sight |
| North America | PP Homo Injection | Offer Given | 800 | LC 90 Days |
| North America | PP Homo Injection | Offer Received | 850 | LC at sight |
| North America | PP Homo Injection | Sold | 840 | LC at sight |
| Southeast Asia | PP Homo Injection | Offer Given | 940** | LC at sight |
| Southeast Asia | PP Homo Injection | Offer Received | 940-1,040 | LC at sight |
| Central Asia | PP Homo Raffia | Offer Received | 860-870 | LC at sight |
| Far East Asia | PP Homo Raffia | Offer Given | 900**-950** | LC at sight |
| Indian Subcontinent | PP Homo Raffia | Offer Given | 850-900 | LC at sight |
| Indian Subcontinent | PP Homo Raffia | Offer Received | 900-920** | LC at sight |
| Indian Subcontinent | PP Homo Raffia | Sold | 900 | LC at sight |
| Middle East | PP Homo Raffia | Offer Given | 810-930 | LC at sight |
| Middle East | PP Homo Raffia | Offer Received | 870-1,030 | LC at sight |
| Middle East | PP Homo Raffia | Buy Idea | 830-850 | LC at sight |
| Middle East | PP Homo Raffia | Purchased | 890 | LC at sight |
| Southeast Asia | PP Homo Raffia | Offer Given | 940** | LC at sight |
| Southeast Asia | PP Homo Raffia | Offer Received | 940 | LC at sight |
| Southeast Asia | PP Homo Raffia | Sold | 920** | LC at sight |
| Southern Africa | PP Homo Raffia | Offer Received | 860 | LC at sight |
| Southern Africa | PP Homo Raffia | Purchased | 860 | LC at sight |
| Far East Asia | PP Random Copolymer Extrusion | Offer Given | 1,080** | LC at sight |
| Southeast Asia | PP Random Copolymer Extrusion | Offer Given | 1,120** | LC at sight |
| Southeast Asia | PP Random Copolymer Extrusion | Offer Received | 1,150 | LC at sight |
| Southeast Asia | PP Random Copolymer Injection | Offer Received | 1,070 | LC at sight |
| Far East Asia | PP Random Copolymer Blow | Offer Given | 1,040** | LC at sight |
| Far East Asia | PP Random Copolymer Blow | Sold | 1,010* | LC at sight |
| Middle East | PP Random Copolymer Blow | Offer Received | 1,130-1,180 | LC at sight |
| Southeast Asia | PP Random Copolymer Blow | Offer Given | 1,060** | LC at sight |
Description: *June shipment **July Shipment
Tags: Asia Pacific,China,English,NEA,PP,Quarterly
Published on July 7, 2020 10:08 PM (GMT+8)
Last Updated on September 16, 2020 9:31 PM (GMT+8)
