quarterlyssessments-q2-2020-sea-pp-prices

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Import PP Homo Film offers recorded an increase of triple digits in June
Concern over coronavirus outbreak dented market sentiment
Pricing outlook firm on tight supply, a further price increase remains feasible

As coronavirus began its relentless march around the globe, this pandemic has sent ripples of shock waves across Southeast Asian PP markets, sources reported to SSESSMENTS.COM. During the second quarter of 2020, Southeast Asia’s domestic and import PP prices were largely taking cues from global crude oil futures as more signs of the global spread of the coronavirus heightened fears of a pandemic, which could thwart fuel demand. In April, local PP prices in Southeast Asia went on a rollercoaster ride, as news of the coronavirus continued to paint a dire picture. In Malaysia, April delivery offers for PP Homopolymer and Copolymer grades from the local producer lowered between MYR350-800/ton ($82-187/ton) compared to March. In Thailand, offers for PP Homopolymer grades from the local producers were mostly captured on a downtrend during the first half of April, with a total reduction of between THB500-1,000/ton ($16-32/ton). However, on the week commencing April 20, Thai producers adjusted up the offers for PP across all grades by THB1,500/ton ($48/ton) on a weekly basis as the producers managed to sell big quantities to domestic and export markets. Meanwhile, the leading Philippines polyolefins producer refused to provide pricing quotes to the domestic market in April, chose to selectively offer cargoes if there were inquiries from buyers. From the import market, most sellers set off a round of price cuts amid a hammering of markets by coronavirus pandemic and a sharp slump in crude oil prices to multi-year lows. Overall, Southeast Asia’s import PP prices in April gained a cumulative decrease of $50/ton.

In May, SSESSMENTS.COM was informed that local PP offers in Southeast Asia showed different trends each week. In Malaysia, May delivery offers for PP Homopolymer grades from the leading Malaysian polyolefins producer were unchanged as compared to April, while offers for PP Copolymer grades were down by MYR250-260/ton ($58-61/ton) compared to the same period. Whereas in Thailand, local producers quoted higher offers for PP Homopolymer grades to the domestic market in May, with a range of increase between THB500-1,000/ton ($16-32/ton) week by week, mainly fuelled by tight supply concerns. From the import market, Southeast Asia’s import PP prices in May gained a cumulative increase of between $20-40/ton. In response to sharp gains in import prices, most buyers in the region were holding back their purchases in anticipation of greater falls in prices, mainly due to a large drop in demand in domestic and export destination countries driven by the pandemic crisis.

Southeast Asia’s domestic and import PP prices gained ground in June as crude oil prices bounced up from the historic April lows, coupled with tight availability of spot cargoes. In Malaysia, June delivery offers for PP Homopolymer and Copolymer grades from a local producer edged higher between MYR100-280/ton ($23-65/ton) compared to May. In the Philippines, local PP offers from the leading polyolefins producer on the week commencing June 8 increased between PHP1,000-2,000/ton ($20-40/ton). Whereas in Thailand, offers for PP Homopolymer grades from the local producers were mostly captured on an uptrend during June, with a range of increase between THB500-2,000/ton ($16-64/ton) week by week. From the import market, July shipment offers for PP Homo Film from a Middle Eastern producer surfaced with a significant increase as much as $130/ton on a monthly basis. Detailed information for Indonesia and Vietnam market is available in QuarterlySSESSMENTS of the respective countries.

Southeast Asia PP market continued to face strong headwinds in Q2 2020, with coronavirus still dominating as a key factor in the market. The market was hit hard by coronavirus shutdowns that started sweeping the region in the late February and early March, derailing entire sectors of the economy and decimating consumer spending. In April, overall buying sentiment was sluggish, weighed down by market players' concerns on how the spread of the lethal virus could affect trade flows and have an effect on global prices. Besides, the biggest drop in crude oil prices also pushed the market into a slowdown and led to rising uncertainties. Despite a steady increase in coronavirus cases in some parts of the region, Southeast Asian countries have begun easing its lockdown in a phase-wise manner from early May. Even though most countries were taking a gradual approach to lifting restrictions, sources pointed out that some downstream factories were still struggling to keep their operating rate at normal levels amid weak end-users demand for finished products. In the second half of May, activity in Malaysia and Indonesia market remained muted, with limited spot trades taking place as the majority of market players were away from their desks for Eid Al-Fitr celebration. In June, concerns that the second wave of coronavirus infections was hitting the region as it emerged from lockdown, with buyers purchasing on a hand-to-mouth basis only, and unwilling to build inventories amid worsening economic outlook. Further added, as the rally in crude oil prices has sent most commodities prices spiralling upward, some buyers in the region started showing a strong resistance toward higher offers as no strong demand fundamentals to support any form of price hikes.

On plant news, Thailand’s Integrated Refinery Petrochemical Complex (IRPC) took its PP line no. 3 and no. 4 off-stream in the middle of June. The producer’s PP line no. 3 remained closed for maintenance work from June 12 until June 26. Upon the completion of maintenance at PP line no. 3, the producer also underwent a maintenance shutdown at its PP line no. 4 starting from June 29 and expected to be back on-stream in mid-July. Located in Rayong Province, Thailand, PP line no. 3 and no. 4 have a production capacity of 225,000 tons/year and 160,000 tons/year, respectively.

Entering the third quarter of 2020, market participants in Southeast Asia voiced out to SSESSMENTS.COM that the coronavirus pandemic will continue to weigh heavily on overseas and domestic demand, considering raising fears over a second wave of the coronavirus following a spike in untraceable local infections and imported cases in the region. Although the coronavirus pandemic continues to take a toll on demand, some sources expect that PP prices will continue its upward trend, citing limited availability of spot cargoes.

Transactions for local/localized PP in April on FD basis, excluding VAT (except in PHP including 12% VAT, all equivalent in USD excluding VAT)

Origin	Product	Transaction Type	Currency	Offers/ton	Equivalent in USD/ton	Payment Term	Delivery Country
Malaysia	PP Block Copolymer	Price List	MYR	4,060-4,380	948-1,023	30 Days Credit Term	Malaysia
Malaysia	PP Homo Film	Offer Given	MYR	3,950	922	30 Days Credit Terms	Malaysia
Malaysia	PP Homo Film	Price List	MYR	3,950	922	30 Days Credit Term	Malaysia
Thailand	PP Homo Film	Offer Given	THB	27,500-30,500	884-980	Cash In Advance	Thailand
Thailand	PP Homo Film	Offer Given	THB	28,500-29,000	916-932	30 Days Credit Term	Thailand
Thailand	PP Homo Film	Offer Received	THB	26,500-30,000	851-964	Cash In Advance	Thailand
Thailand	PP Homo Film	Purchased	THB	27,000-31,000	868-996	Cash In Advance	Thailand
Thailand	PP Homo Film	Sell Idea	THB	29,000	932	Cash In Advance	Thailand
Malaysia	PP Homo Raffia	Offer Given	MYR	3,800	887	30 Days Credit Term	Malaysia
Malaysia	PP Homo Injection	Price List	MYR	3,750	876	30 Days Credit Term	Malaysia
Southeast Asia	PP Homo Injection	Offer Given	PHP	62,000-65,000	1,120-1,174	Cash In Advance	Philippines
Thailand	PP Homo Injection	Offer Given	THB	27,000-30,000	868-964	Cash In Advance	Thailand
Thailand	PP Homo Injection	Offer Given	THB	28,000-28,500	890-916	30 Days Credit Term	Thailand
Thailand	PP Homo Injection	Offer Received	THB	26,000-28,500	835-916	Cash In Advance	Thailand
Thailand	PP Homo Injection	Sold	THB	27,500-28,500	884-916	Cash In Advance	Thailand
Malaysia	PP Homo Raffia	Offer Received	MYR	3,600	841	Cash In Advance	Malaysia
Malaysia	PP Homo Raffia	Price List	MYR	3,800-4,650	887-1,086	30 Days Credit Term	Malaysia
Malaysia	PP Homo Raffia	Purchased	MYR	3,600-4,600	841-1,074	Cash In Advance	Malaysia
Malaysia	PP Homo Raffia	Purchased	USD	815	-	Cash In Advance	Malaysia
Philippines	PP Homo Raffia	Offer Given	PHP	67,00	1,210	Cash In Advance	Philippines
Southeast Asia	PP Homo Raffia	Offer Given	PHP	62,00-65,000	1,120-1,174	Cash In Advance	Philippines
Thailand	PP Homo Raffia	Buy Idea	THB	27,500-28,000	884-890	30 Days Credit Term	Thailand
Thailand	PP Homo Raffia	Offer Given	THB	26,500-30,000	851-964	Cash In Advance	Thailand
Thailand	PP Homo Raffia	Offer Given	THB	28,000-28,500	890-916	30 Days Credit Term	Thailand
Thailand	PP Homo Raffia	Offer Received	THB	26,000-29,500	835-948	Cash In Advance	Thailand
Thailand	PP Homo Raffia	Sell Idea	THB	28,500	916	Cash In Advance	Thailand
Thailand	PP Homo Raffia	Sold	THB	27,500-28,500	884-916	Cash In Advance	Thailand
Malaysia	PP Random Copolymer Extrusion	Price List	MYR	4,360-5,270	1,018-1,231	30 Days Credit Term	Malaysia
Thailand	PP Random Copolymer Injection	Offer Given	THB	33,500-34,500	1,076-1,109	Cash In Advance	Thailand

Transactions for import PP in April on LC at sight, CIF Main Port basis

Origin	Product	Transaction Type	Offers (USD/ton)	Delivery Location
Southeast Asia	PP Block Copolymer	Offer Received	950	Southeast Asia
Middle East	PP Homo Film	Offer Received	800	Thailand
Middle East	PP Homo Film	Purchased	800	Thailand
Southeast Asia	PP Homo Raffia	Offer Received	850-880	Philippines
Southeast Asia	PP Homo Raffia	Sold	890	Philippines
Middle East	PP Homo Raffia	Offer Received	790	Myanmar
Southeast Asia	PP Homo Raffia	Offer Received	810	Thailand
Southeast Asia	PP Homo Raffia	Offer Given	800-850	Southeast Asia
Southeast Asia	PP Homo Raffia	Offer Received	800	Malaysia

Transactions for local PP in May on FD basis, excluding VAT (except in PHP including 12% VAT, all equivalent in USD excluding VAT)

Origin	Product	Transaction Type	Currency	Offers/ton	Equivalent in USD/ton	Payment Term	Delivery Country
Malaysia	PP Block Copolymer	Price List	MYR	4,060-4,230	946-985	30 Days Credit Term	Malaysia
Malaysia	PP Homo Film	Offer Given	MYR	3,950	922	30 Days Credit Term	Malaysia
Malaysia	PP Homo Film	Price List	MYR	3,950	922	30 Days Credit Term	Malaysia
Thailand	PP Homo Film	Bid Received	THB	28,000	890	Cash In Advance	Thailand
Thailand	PP Homo Film	Buy Idea	THB	26,500	851	Cash In Advance	Thailand
Thailand	PP Homo Film	Offer Given	THB	28,500-31,500	916-1,012	Cash In Advance	Thailand
Thailand	PP Homo Film	Offer Received	THB	28,500-31,500	916-1,012	Cash In Advance	Thailand
Thailand	PP Homo Film	Offer Received	THB	31,000	996	30 Days Credit Term	Thailand
Thailand	PP Homo Film	Purchased	THB	28,250	908	Cash In Advance	Thailand
Thailand	PP Homo Film	Sell Idea	THB	27,500-28,000	884-890	Cash In Advance	Thailand
Malaysia	PP Homo Injection	Price List	MYR	3,750	876	30 Days Credit Term	Malaysia
Southeast Asia	PP Homo Injection	Offer Given	PHP	62,000-65,000	1,120-1,174	Cash In Advance	Philippines
Thailand	PP Homo Injection	Bid Received	THB	27,500	884	Cash In Advance	Thailand
Thailand	PP Homo Injection	Offer Given	THB	27,250-30,500	876-980	Cash In Advance	Thailand
Thailand	PP Homo Injection	Offer Received	THB	30,000-30,500	964-980	Cash In Advance	Thailand
Thailand	PP Homo Injection	Purchased	THB	28,000	890	Cash In Advance	Thailand
Thailand	PP Homo Injection	Sell Idea	THB	27,000-27,500	868-884	Cash In Advance	Thailand
Thailand	PP Homo Injection	Sold	THB	28,000-28,500	890-916	Cash In Advance	Thailand
Malaysia	PP Homo Raffia	Offer Given	MYR	4,080	953	30 Days Credit Term	Malaysia
Malaysia	PP Homo Raffia	Offer Received	MYR	3,750-4,130	876-964	30 Days Credit Term	Malaysia
Malaysia	PP Homo Raffia	Price List	MYR	3,800-3,850	887-899	30 Days Credit Term	Malaysia
Malaysia	PP Homo Raffia	Purchased	MYR	3,650	852	30 Days Credit Term	Malaysia
Philippines	PP Homo Raffia	Offer Given	PHP	67,000	1,210	Cash In Advance	Philippines
Southeast Asia	PP Homo Raffia	Offer Given	PHP	62,000-65,000	1,120-1,174	Cash In Advance	Philippines
Thailand	PP Homo Raffia	Bid Received	THB	27,500	884	Cash In Advance	Thailand
Thailand	PP Homo Raffia	Buy Idea	THB	26,000	835	Cash In Advance	Thailand
Thailand	PP Homo Raffia	Offer Given	THB	27,250-30,500	876-980	Cash In Advance	Thailand
Thailand	PP Homo Raffia	Offer Received	THB	28,000-30,500	890-980	Cash In Advance	Thailand
Thailand	PP Homo Raffia	Sell Idea	THB	27,000-27,500	868-884	Cash In Advance	Thailand
Thailand	PP Homo Raffia	Sold	THB	28,000-29,500	890-948	Cash In Advance	Thailand
Malaysia	PP Random Copolymer Extrusion	Price List	MYR	4,360-5,190	1,018-1,212	30 Days Credit Term	Malaysia

Transactions for import PP in May on LC at sight, CIF Main Port basis

Origin	Product	Transaction Type	Offers (USD/ton)	Delivery Location
Southeast Asia	PP Block Copolymer	Offer Received	920	Philippines
Middle East	PP Homo Film	Offer Received	890	Philippines
Middle East	PP Homo Film	Price List	910	Philippines
Southeast Asia	PP Homo Film	Offer Received	890-900	Philippines
Middle East	PP Homo Injection	Price List	910	Philippines
Southeast Asia	PP Homo Injection	Offer Received	850-870	Philippines
Middle East	PP Homo Raffia	Price List	880	Philippines
Middle East	PP Homo Raffia	Offer Received	850-860	Myanmar
Southeast Asia	PP Homo Raffia	Offer Received	850-870	Philippines
Southeast Asia	PP Homo Raffia	Offer Given	850-870	Southeast Asia
Southeast Asia	PP Homo Raffia	Sold	900	Southeast Asia
Middle East	PP Random Copolymer Injection	Price List	1,020	Philippines

Transactions for local PP in June on FD basis, excluding VAT (except in PHP including 12% VAT, all equivalent in USD excluding VAT)

Origin	Product	Transaction Type	Currency	Offers/ton	Equivalent in USD/ton	Payment Term	Delivery Country
Malaysia	PP Block Copolymer	Offer Given	MYR	4,440	1,037	30 Days Credit Term	Malaysia
Malaysia	PP Block Copolymer	Price List	MYR	4,440-4,510	1,037-1,053	30 Days Credit Term	Malaysia
Malaysia	PP Homo Film	Offer Received	MYR	4,230-4,290	988-1,002	30 Days Credit Term	Malaysia
Malaysia	PP Homo Film	Price List	MYR	4,550	1,062	30 Days Credit Term	Malaysia
Philippines	PP Homo Film	Offer Received	PHP	62,000-63,000	1,120-1,138	Cash In Advance	Philippines
Philippines	PP Homo Film	Purchased	USD	1,000	-	Cash In Advance	Philippines
Thailand	PP Homo Film	Offer Given	THB	34,000-37,000	1,092-1,189	Cash In Advance	Thailand
Thailand	PP Homo Film	Offer Received	THB	32,000-36,000	1,028-1,157	Cash In Advance	Thailand
Thailand	PP Homo Film	Sold	THB	29,500	948	Cash In Advance	Thailand
Malaysia	PP Homo Injection	Offer Given	MYR	4,030-4,350	941-1,013	30 Days Credit Term	Malaysia
Malaysia	PP Homo Injection	Price List	MYR	4,030-4,350	941-1,013	30 Days Credit Term	Malaysia
Philippines	PP Homo Injection	Offer Received	PHP	60,000-61,000	1,084-1,102	Cash In Advance	Philippines
Thailand	PP Homo Injection	Offer Given	THB	30,500-37,000	980-1,189	Cash In Advance	Thailand
Thailand	PP Homo Injection	Offer Received	THB	32,000-35,500	1,028-1,141	Cash In Advance	Thailand
Thailand	PP Homo Injection	Sold	THB	29,000-30,500	932-980	Cash In Advance	Thailand
Malaysia	PP Homo Raffia	Offer Given	MYR	4,080-4,130	953-964	30 Days Credit Term	Malaysia
Malaysia	PP Homo Raffia	Price List	MYR	4,080-4,450	953-1,037	30 Days Credit Term	Malaysia
Malaysia	PP Homo Raffia	Purchased	MYR	4,300	1,004	Cash In Advance	Malaysia
Malaysia	PP Homo Raffia	Sold	MYR	4,080	953	Cash In Advance	Malaysia
Philippines	PP Homo Raffia	Offer Received	PHP	60,000-62,000	1,084-1,120	60 Days Credit Term	Philippines
Philippines	PP Homo Raffia	Offer Received	PHP	60,000-61,000	1,084-1,102	Cash In Advance	Philippines
Philippines	PP Homo Raffia	Purchased	USD	950	-	Cash In Advance	Philippines
Thailand	PP Homo Raffia	Offer Given	THB	30,500-36,000	980-1,157	Cash In Advance	Thailand
Thailand	PP Homo Raffia	Offer Received	THB	31,500-36,000	1,012-1,157	Cash In Advance	Thailand
Thailand	PP Homo Raffia	Offer Received	THB	33,500	1,076	30 Days Credit Term	Thailand
Thailand	PP Homo Raffia	Sold	THB	29,000-30,500	932-980	Cash In Advance	Thailand
Malaysia	PP Random Copolymer Extrusion	Price List	MYR	4,820-5,470	1,126-1,277	30 Days Credit Term	Malaysia

Transactions for import PP in June on LC at sight, CIF Main Port basis

Origin	Product	Transaction Type	Offers (USD/ton)	Delivery Location
Middle East	PP Block Copolymer	Offer Received	950	Myanmar
Southeast Asia	PP Block Copolymer	Sold	980-990	Southeast Asia
Indian Subcontinent	PP Homo Film	Offer Received	890	Thailand
Middle East	PP Homo Film	Offer Received	990	Philippines
Southeast Asia	PP Homo Film	Offer Received	1,020	Philippines
Middle East	PP Homo Raffia	Offer Received	865-880	Myanmar
Southeast Asia	PP Homo Raffia	Sell Idea	900	Southeast Asia
Southeast Asia	PP Homo Raffia	Sold	920	Southeast Asia
Southeast Asia	PP Homo Raffia	Sold	960-980	Philippines

Tags: Asia Pacific,English,PP,Quarterly,SEA

Published on July 7, 2020 3:25 PM (GMT+8)
Last Updated on September 18, 2020 1:00 PM (GMT+8)

QuarterlySSESSMENTS: Q2 2020 SEA PP Prices

Author: SSESSMENTS

QuarterlySSESSMENTS: Q2 2020 SEA PP Prices

Author: SSESSMENTS

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