Bangladesh PP Market Take A Beating On Second Wave Fears
- An Emirati producer has yet to announce July shipment offers to Bangladesh
- A resurgence of coronavirus infections sparks fresh local lockdowns, sentiment turned bearish
- Import PP offers would continue to increase following the international trend
SSESSMENTS.COM was told that Bangladesh PP market has been hit hard by fears of a second wave of COVID-19 outbreak. For the week commencing June 22, a global trading house is offering Indian and Middle Eastern PP Homo Raffia cargoes to Bangladesh market at $940/ton and $960/ton, respectively. In response, most buyers are reluctant to take the cargoes and prefer to wait for more fresh offers from other suppliers. At the time of the publication, no transactions were successfully concluded in the market. Some sources in Bangladesh also mentioned that an Emirati producer is scheduled to announce July shipment offers to the market by next Thursday, July 2. All import offers are on LC at sight, CFR Chittagong Port.
Amid a rise in cases of the novel coronavirus, the Bangladeshi government have decided to impose area-wise lockdowns in capital Dhaka and other regions, which has claimed 1,545 lives and infected over 119,000 people so far. The decision comes about a week after the country withdrew the nationwide lockdown restrictions at the end of May. As per criteria, SSESSMENTS.COM was informed that around 45 areas in the capital, the entire Gazipur district, 11 areas in the port city of Chattogram, and few areas of Narayanganj and Narsingdi have been labelled as red zones. The government also extended the restrictions on movement until June 30 to curb further spread of the highly contagious virus alongside taking effective measures to run the wheels of the economy. Demand-wise, soaring numbers of infections has led to low purchasing power from the end-user segment as the country is again reimposing zone-wise lockdowns, triggering a chain reaction of low demand. Market sentiment has turned bearish as more market players are refrained from replenishing stocks and prefer to adopt a wait-and-see stance. On the production front, long periods of lockdown have severely affected a wide range of sectors, particularly the manufacturing sector. As the country goes back into stringent lockdown measures, some manufacturers are running at a reduced capacity of 50% from the normal output, while others have been forced to halt the production activities.
For the outlook, market sources voiced out to SSESSMENTS.COM that the reimposed lockdowns will further weaken the economy, leading to a significant drop in demand. On the other hand, sources expressed that import PP offers will most likely to increase further in line with the international market trend.
