Chinese producers trimmed export PP offers amid a persistent weakness at home

Chinese PP exporters have been contending with lackluster demand from overseas buyers for several months, as high shipping costs have eroded the competitiveness of their cargoes. Attempts to maintain stable prices in recent weeks have resulted in poor sales, and diminishing local market sentiment has further strained cash flow.

In response, at least three Chinese producers have agreed to lower export PP offers at the start of the week in an effort to facilitate overseas transactions as the shipping situation begins to ease.

The overall export offers from these suppliers and changes from the previous week are as follows:

"Responses from international customers have been lukewarm. We are open to negotiation with serious buyers, though closing deals without steeper discounts might prove challenging," commented a producer.

Despite weak performance on the Dalian Commodity Exchange, the absence of substantial inventory pressure and strong upstream propylene costs have prevented any drastic downturn in the local PP market. Without a significant drop in local prices, Chinese producers see little incentive to substantially slash export offers.

Data from the Chinese Customs Department showed that in May 2024, the country exported 221,800 tons of PP. This figure is expected to decline in June due to weak overseas demand and constrained shipping conditions.

Written by: Kat Yun Yun

Edited by: Rochelle Nguyen