Indonesian players: Preliminary signs of homo-PP restocking

Players in Indonesia market reported toward the end of the week seeing some preliminary signs of converters restocking material from import market after a brief slow down. Market participants attributed this to the fact that manufacturers are running low on inventories while current import prices appears to be more competitive than domestic cargoes.

A woven bag converter purchased Singaporean homo-PP yarn at $1120/ton CIF Indonesia, LC AS term said, “We proceeded with small buy as it seems the market is not having ample supply, which might prevent prices from sliding too quickly. Demand for our end product is good and we are looking to additional quantity in the coming week.”

Another converter added, “We only have material to cover production needs till early September, hence we also source some cargoes from domestic market to reduce the risk of delayed import shipment. The gap between local and import prices are rather large. Meanwhile, we are monitoring further movement in the nearby major markets to gauge the likely price direction in the near term. For this, we prefer to purchase in small quantity.”

Several other converters contacted by CommoPlast have reported purchasing cargoes this week to maintain stock levels, though mostly hoping to see further reduction in the coming weeks. Import homo-PP prices to Indonesia currently stand at $1030-1230/ton CIF Indonesia, LC AS term.