Morning Briefing - 20 April 2022
CommoPlast
Morning Briefing
20 April 2022
Brent: $107.25 (- $5.91）
WTI: $102.56 (- $5.65）
Naphtha CFR Japan: $942.4 (- $15.1)
Ethylene CFR NEA: $1310 (Stable)
Ethylene CFR SEA: $1360 (Stable)
Propylene FOB Korea: $1190 (Stable)
Propylene CFR China: $1150 (Stable)
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The downtrend in the Vietnamese homo-PP market persists into the fifth consecutive week with little sign of an overturn anytime so soon. Earlier this week, spot offers for Thailand homo-PP fell $50/ton week-on-week, which apparently, attracted no buying interest. The supplier, at the time of this report, has conceded to another $25/ton discount to close deals. In the span of four weeks, offers for this cargo plunged a total of $175/ton.
Vietnamese buyers generally prefer to make only small purchases while waiting for further price reductions ahead. As reported earlier, buy ideas for import homo-PP yarn and injection are below the $1300/ton threshold, based on CIF terms.
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In China, the logistics bottleneck started to ease as sellers are now able to deliver the previously locked-up parcels smoothly. As a result, local inventories are expected to deplete quickly in the coming days. As of 19 April 2022, the total PP and PE stocks at Sinopec and CNPC’s warehouses fell 35,000 tons to 865,000 tons, according to the CommoPlast tally.
However, the fresh PP and PE offers at higher levels do not attract great buying attention this week. Customers are waiting for their previously purchased cargoes to arrive while keeping an eye on the promised economic stimulus package to boost local consumption.
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In related plant status news, China’s Zhongjing Petrochemical is on track to start up its second PP plant in Fujian, China this June. The plant has a nameplate capacity of 1.2 million tons/year using LyondellBasell’s 5th Generation Spheripol technology. According to a source close to the producer, the new plant is likely to produce homo-PP yarn and injection grade at the initial stage before transitioning to specialty grades.
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