Morning Briefing - 3 February 2023
CommoPlast
Morning Briefing
03 February 2023
Brent: $82.17 (- $0.67)
WTI: 75.88 (- $0.53)
Naphtha CFR Japan: $701 (- $5)
Ethylene CFR NEA: $830 (Stable)
Ethylene CFR SEA: $870 (Stable)
Propylene FOB Korea: $935 (+ $15)
Propylene CFR China: $965 (+ $15)
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It has been a week since the Chinese market resumed trading after the long Spring Festival and the purchasing activities in this market remained very much mediocre. Key futures contracts on Dalian Commodity Exchange registered three straight days of losses despite various bullish supports, including the low inventory levels and rebounding economic activities.
Zhongjing Petrochemical lowered export homo-PP offers twice this week to reflect the soft domestic ground and dwindling demand condition across the Southeast Asia market.
On the bright side, several Chinese suppliers reported seeing an uptick in inquiries from South American buyers, with deals done for homo-PP yarn, injection, and fibre at $1110/ton FOB China.
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The Asian propylene market is now at its highest levels since July 2022 and for the first time in twelve months, propylene is traded above ethylene on the back of tight availability and strong upstream costs.
Saudi Aramco announced February contract propane prices to Asia with a $200/ton hike from last month, sending the latest price list to $790/ton FOB Ras Tanura. Asian PP producers, who are using propane as the main feedstock in their production are looking at substantially higher costs this month, which might keep the current firming trend in place.
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