Supply Condition Determined Pricing Decision For Local Market Made By Chinese PS Producers
- Local PS offers obtained foothold from supply condition
- Domestic demand has improved but buying pattern remain the same
- Players opined that SM price still has room to move up, so is local PS price
As SSESSMENTS.COM noted, supply condition has determined the pricing decision for local market made by Chinese PS producers. In the local market, some Chinese PS producers decided to maintain their offers stable, while some others raise their offers by CNY100/ton ($14/ton) for GPPS Injection and by CNY50/ton ($7/ton) for HIPS Injection. All compared to last week’s levels. A producer further explained that the current pricing decision was made as triggered by the limited supply in the domestic market. In the import market, a Taiwanese PS producer’s latest offers to the China market recorded at $910-920/ton for GPPS Injection and at $1,010-1,020/ton for HIPS Injection. All offers are on LC at sight, CIF China Main Port basis. According to SSESSMENTS.COM’s pricing database, both cargoes were hiked between $20-40/ton from last week’s levels. Meanwhile, a South Korean PS producer has sold all of July allocations since last week, and now the producer is busy arranging the shipments. Additionally, a Malaysian PS producer skipped this month’s offers to the China market due to supply shortage on the company’s end.
Demand-wise, SSESSMENTS.COM was told that the domestic PS market has gradually improved since last week following the better demand for end-products, especially for air conditioners. However, converters are mostly still in a cautious stance and unwilling to place orders in a huge volume. Meanwhile, most big converters have replenished their stocks when the prices were on a downtrend. Besides better end-products demand, supply limitation in the domestic market has also stimulated buying sentiment as of recent. Speaking of supply, as of June 12, SM inventory in coastal China decreased by 11,400 tons, recorded at 303,300 tons. While from the traders’ end, the inventory stood at 201,800 tons, dropped by 10,900 tons. All changes compared to a week earlier. On the plant news, BASF-YPC Company Limited reportedly will finish maintenance shutdown at its 200,000 tons/year PS unit as scheduled on June 20, 2020.
Looking ahead, Chinese market players contacted by SSESSMENTS.COM believe that SM prices still have room to rise, afterwards, local PS prices will likely follow suit. In terms of demand, players opined that buying sentiment may remain the same in the upcoming weeks as converters will stay on a cautious stance.
