Import homo-PP supply deems improved in Vietnam

Import homo-PP prices to Vietnam started to retreat late July 2016 after an extended period of continuous increment with the support from tight supply from international suppliers. However, this week, buyers in the country reported seeing indications that supplies from overseas sellers have improved to a certain extent.

A buyer said, “If previously our supplier only have weekly allocation of about 500 tons Saudi Arabia homo-PP to offer; this week we are informed that they have sold approximate 2000 tons of the same cargoes. Supply appears to have improved from the recent tightness as other distributors also claimed higher availability.” It has been speculated that slower demand in other major markets has encouraged sellers to divert their cargoes to Southeast Asia region where better margins can be obtained.

Indeed, a distributor informed receiving additional homo-PP quantity from a Middle Eastern producer today after completed August sales earlier last week. The source acknowledged, “Our principal assigned another 1000 tons of cargoes to Vietnam today and we managed to sell just well at the level of $1000/ton, CIF, LC AS term. Both import and domestic markets have been alleviated from supply tightness, and for this we are concern about the market outlook in the near term.”

Earlier this week, market also reported that a major Thailand producer also joins Vietnam market, though there is no specific offer given. A source closed to the company informed, “We have some quantity and currently collecting bids from the market before setting prices. Respond is not as good as expected, therefore we are considering the next move at the moment.”

Import homo-PP to Vietnam currently stand at $985-1030/ton, CIF Vietnam, LC AS term. Players are monitoring movement in Turkey in China markets to gauge the likely direction in the coming month.