USA homo-PP shows up in Vietnam, China market

According to sources, homo-PP originated from the USA emerged again in China and Vietnam market this week after several months’ absence. These cargoes are priced slightly below the current market levels, yet buyers are not showing great appetite claiming long shipping time might contain high risk.

A Chinese trader received offers at $1030-1040/ton for homo-PP yarn, injection and fibre and purchased some quantity at $1020/ton based on CFR China, LC 90 days term, which is at least $30/ton below Middle Eastern material. The source informed, “Our supplier have about 5,000 tons allocation for prime grade and there are also some off-grade cargoes available. We only bought small quantity as market outlook during December-January remain very cloudy.”

In Vietnam, sources reported availability of USA’s homo-PP cargoes at $1010/ton CIF Vietnam, LC AS term. However, respond is not very positive amid rising domestic supply levels. A trader commented, “Aside current sluggish local demand, these cargoes will be subjected to higher import duties once arrived in January 2017. Even with $20-30/ton discount, we are not planning to purchase as we are having comfortable stock on hand.”

The Asian PP market is currently in the tug-of-war between falling upstream costs and perceived tightening supply due to a number of plant shutdowns in November. Players are diverged in their opinion regarding the likely market direction in the near to medium term. Some have advised to closely monitor the replenishment activities amongst converters in preparation for Lunar New Year orders before making conclusive decision.