Vietnamese players: Local homo-PP continues to move south

Vietnamese players have been actively replenishing material since they returned from the traditional Chinese New Year holidays, pushing prices to the highest level seen since beginning of forth quarter 2015. However, market sentiment is reported to show some signs of slowing down late last week and worsening this week as falling energy values defecating buyer’s confidence. 

Players are reporting some VND200,000-500,000/t ($9-22/t) reduction in locally held homo-PP cargoes compared to last week with a trader receiving Saudi Arabia origins at VND26,800,000/t ($1093/t without VAT) FD Vietnam, including VAT said, “We offered at the same level to our regular buyers and they have not shown any interest claiming sufficient supply.” 

Meanwhile, another buyer receiving Vietnamese homo-PP at VND27,00,000/t ($1100/t without VAT) with the same term for 500 tons cargoes said, “Local trader are psychologically hit by falling energy market, hence they prefer to cut short profit margins to sell quick. However, we think that import market will not be pressurized so much as supply is rather tight. Local market might be caught on tightness again in June since traders are not buying aggressively at the current price level. We would maintain wait and see stance for now.”

Couple of traders has expressed their intention in diverting non-dutiable cargoes to the near-by Indonesia market, where demand is relatively better and yield higher profit margins.

Local homo-PP prices in Vietnam is currently reported at VND26,500,000-27,700,000/t ($1080-1130/t without VAT) FD Vietnam, including VAT. Meanwhile, import homo-PP to the country stand at $1070-1140/t CIF Vietnam, LC 0-180 days term.

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