Morning Briefing - 30 March 2022
CommoPlast
Morning Briefing
30 March 2022
Brent: $110.23 (- $2.25）
WTI: $104.24 (- $1.72）
Naphtha CFR Japan: $967.8 (- $5.8)
Ethylene CFR NEA: $1370 (Stable)
Ethylene CFR SEA: $1400 (Stable)
Propylene FOB Korea: $1250 (- $10)
Propylene CFR China: $1180 (- $15)
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Shanghai is under lockdown. Not only that demand in China’s largest city by population is falling rapidly, but delivery in and out of the city is described as ‘near to impossible’. Customers from both local and international markets shall expect delays in shipments until the city curb the current wave of outbreaks.
Meanwhile, Chinese sellers remain calm with no sign of panic selling. The expectations are that demand from non-lockdown areas would gradually come back in the near term. Meanwhile, the mass production rate cuts started to impact the domestic inventory levels. As of 29 March 2022, the total PP and PE stocks fell 50,000 tons day-on-day to approximately 850,000 tons.
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In Vietnam, it appears that PP suppliers are submitting to the persistently sluggish demand condition. A key South Korean producer in the previous week insisted on the price levels of $1460-1470/ton CIF Vietnam due to thin profit margins, has now lowered the price list to $1435-1445/ton with the same terms. Thailand homo-PP nosedived to $1530/ton from $1610/ton recorded earlier this month.
Homo-PP supply in the local Vietnam market remains comfortable at the time of this report despite the recent shutdown at Nghi Son Refinery and Petrochemical. Manufacturers in the country refrain from chasing after the higher price levels amid the inability to lift end-product selling prices quickly enough to cover the raw material costs.
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