Adjustments On Local And Import PP Offers Viable Considering Indonesian Buyers' Attitude Toward Current Price Trend
- Local and import PP offers captured on the same trend this week
- Domestic demand for PP resins unmoved on the back of manifold factors
- Players foresee downward price adjustments in the upcoming week
Indonesian market players contacted by SSESSMENTS.COM voiced out that adjustments on local and import PP offers are viable considering buyers' attitude toward current price trend and some other factors. On the week starting July 13, the leading Indonesian polyolefins producer initiated a price increase for PP across different grades between IDR140,000-150,000/ton ($9.7-10.4/ton). Following suit, another PP producer in the country raised offers by IDR200,000/ton ($14/ton) for local PP Homo Injection and PP Homo Raffia and IDR350,000/ton ($24/ton) for local PP Homo Film. Meanwhile, most traders decided to roll over prices for local PP Homopolymers grades. One of them stated that the decision was made since the company is unable to adjust up the offers further due to flat demand. For localized cargoes, a converter received offers for Malaysian PP Homo Film at IDR200,000/ton ($13/ton) higher. The offers were available at IDR16,500,000/ton ($1,133/ton) on cash, FD Indonesia basis and excluding 10% VAT, with deals concluded at the same level at the initial offer levels. All price changes are on a weekly comparison.
In the import market, a converter informed receiving stable offers for Saudi PP Homo Raffia cargoes at $960/ton. At the same time, the converter also received import offers for PP Homo Raffia of Vietnam origin at $990-1,000/ton. However, the converter has no intention in taking both cargoes since the offers are deemed unworkable. On the other side, a trader offered Saudi PP Homo Raffia at $20/ton higher due to limited supply from the supplier’s end. Whereas import PP Homo Raffia offers from another Saudi producer remain stable at $940/ton. From India, import offers for PP Homo Injection and PP Homo Raffia increased by $15/ton. Taking into account the flat buying sentiment and buyers’ acceptance level; which is mostly lower than the current offers, some import PP Homopolymers prices were considered unworkable. The trader is also offering PP Block Copolymer cargoes at $1,040/ton for Singapore origin and $1,020/ton for South Korea origin. The trader revealed that the company was offering Singaporean PP Block Copolymer cargoes at $30/ton lower from the supplier’s offers to match buyers’ acceptance level. All price changes are on a weekly interval and all offers are available on LC at sight, CIF Indonesia Main Port basis, SSESSMENTS.COM noted.
In general, buying sentiment for PP resins in Indonesia’s domestic market remains flat this week. Slow sales for end-products, which pushes converters to procure on a hand-to-mouth basis has affected the demand for PP resins. Besides, some others postpone procurement activities due to resistance toward the high prices coupled with sufficient inventory on hands. Speaking of end-products, the sales were recorded stable to slightly decline from last week. On the supply front, SSESSMENTS.COM was told that the largest local trading house in Indonesia reportedly still having tight supply for PP; hence, the company skipped offering this week. Whilst PP supply from the local producers’ end is quite ample at the moment.
For the outlook, some Indonesian market players believe that PP prices will hover at the current offers or move slightly down. Players cited that it is rather hard for local and import PP prices to move further up in the upcoming week considering buyers’ resistance toward the high prices; which is also associated with flat market sentiment. On the other hand, some others opined to SSESSMENTS.COM that the possibility for PP prices to move lower remains high because the prices have been in a relentless uptrend since May; as such, players perceived that the prices are unable to increase further.
