India PP Market Showed Signs Of Recovery As Crude Oil Prices Rebound
- India extends lockdown until May 31
- No fresh import offers available
- Most downstream factories in Gujarat are running at 70% from the normal output
Market sources contacted by SSESSMENTS.COM informed that India PP market showed signs of recovery as crude oil prices rebound. In the domestic market, an Indian producer rolled over offers from a week earlier. The producer is currently offering PP Homo Raffia and PP Homo Injection grades between INR75,000-76,000/ton ($997-1,011/ton) on cash, EXW Bengaluru basis and excluding 18% GST. Current local prices have drawn a largely positive response from most buyers with most done deals achieved at the initial offer levels. As domestic demand started to pick up, the producer is diverting export allocations to the local market due to better netback. Meanwhile, no fresh offers available in the import market this week. A global trading house has finalized deals for Middle Eastern PP Homo Raffia cargoes at $800/ton on LC at sight, CIF Nhava Sheva Port.
On May 17, the Indian government announced a two-week extension in ongoing nationwide lockdown until May 31 after the country reported its biggest single-day jump in cases, citing that the total number of cases rising to above 100,000-mark with Maharashtra state remained the worst-hit region with a total number of confirmed cases more than 40,000. The country has started loosening its lockdown restrictions in a lower-risk region marked as green and orange zones as its economy takes a hammering. However, as crude oil prices have been rallying, market sentiment and domestic demand have been showing signs of recovery within the last couple of weeks. On the production sector, most downstream factories started to resume operations. In Gujarat state, most factories are running at 70% from the normal output. SSESSMENTS.COM noted that no significant supply issues reported at the moment.
Considering rising domestic demand and a rebound in crude oil prices, sources in India foresee that import and local PP prices will likely to increase in the days to come, SSESSMENTS.COM was told.
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