Price List: China’s Zhongjing lifted export PP offers by $15/ton on stronger local market
The rally is driven by optimism over the economic recovery progress after the Chinese government introduced a $42 billion stimulus package to support the country’s falling property sector.
Zhongjing Petrochemical kickstarted the new week with a $15/ton hike in export PP offers compared to earlier this month, citing the surging futures contracts on the Dalian Commodity Exchange and rising local offers.
In fact, as of 10.30 AM Kuala Lumpur time, the September delivery contract for PP on the DCE rose by another CNY130/ton after hitting multi-month highs last Friday. The rally is driven by optimism over the economic recovery progress after the Chinese government introduced a $42 billion stimulus package to support the country’s falling property sector.
The latest offers from the producer and changes from the previous offers are as follows:
|
Grade |
Price List on 20 May 2024 |
Changes |
Term |
|
Homo-PP yarn |
$975 |
+$15 |
FOB China, LC AS/TT |
|
Homo-PP injection |
- |
- |
FOB China, LC AS/TT |
|
BOPP |
$980 |
+$15 |
FOB China, LC AS/TT |
|
PP fibre |
- |
- |
FOB China, LC AS/TT |
|
PP random |
- |
- |
FOB China, LC AS/TT |
|
*Loading port: Jiangyin Port, Fujian, China *LSD: 15 July 2024 |
|||
A source close to the producer said, “It has been challenging to entice overseas demand because of the shipping costs. The surge in local spot and futures markets further narrows the export window for us. At the moment, we focus on delivering previously sold cargoes. Our plant is still operating below the optimum rates; hence, sales pressure is manageable.”
Spot homo-PP yarn traded in the local market at the time of this report at CNY7700 – 7800/ton including VAT ($946 – 959/ton excluding VAT), cash equivalent, indicating a CNY50 – 100/ton hike from the previous day.
Background:
Fujian Zhongjing Petrochemical is a subsidiary of China Soft Packaging Group Holdings Limited – a leading BOPP packaging products manufacturer in China. The company ventured into the upstream sector by building its first PP plant in 2012 and has been actively planning to expand the capacity since then.
Existing plants include two PP lines with a nameplate capacity of 1 million tons/year and a 750,000 tons/year propane dehydrogenation (PDH) unit based in Fujian, China.
In 2018, the company signed a contract to use LyondellBasell’s 5th Generation Spheripol technology to build a new PP line with an estimated annual output of 1.2 million tons/year. The new plant is scheduled to come online between late 2022 to early 2023.
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