Morning Briefing - 23 December 2024

CommoPlast

Morning Briefing

23 December 2024

Brent: $72.94 (+ $0.06)

WTI: $69.46 (+ $0.08)

Naphtha CFR Japan: -

Ethylene CFR NEA: -

Ethylene CFR SEA: -

Propylene FOB Korea: -

Propylene CFR China: -

*Data represent closing prices of the previous trading day 

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Attempts to lift PVC offers at the start of the previous week proved unsustainable, forcing Chinese suppliers to step back on their prices toward the weekend. Domestic spot carbide-based PVC hovered at historically low levels despite firmer futures contracts on the Dalian Commodity Exchange amidst the persistent weakness in the property sector.

A similar trend emerged in the export market. While aggressive pricing strategies in the prior week enabled Chinese suppliers to secure significant sales volumes to India, subsequent attempts to raise offer prices were met with resistance. Buyers, constrained by uncertainties surrounding India’s pending anti-dumping duty (ADD) hearing and a subdued macroeconomic outlook, remained reluctant to accept higher pricing.

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Of the six newly constructed PP plants in China initially slated to begin operations between November and December 2024, only two—Inner Mongolia Baofeng III and Shandong Yulong Petrochemical—have commenced trial production. However, as of December 22, 2024, both plants have yet to achieve on-spec grades.

Attention is now focused on Sinopec Ineos Tianjin, which had planned to start up its PP and PE units in December. As the month progresses, market participants have expressed growing scepticism regarding the company’s ability to initiate trial runs as scheduled. In the meantime, other producers have postponed their startup plans to January due to technical challenges.

Chinese buyers have limited new purchases over recent weeks, assessing the potential impact of additional supply on the market. Pricing negotiations have been particularly intense, especially in the PP sector.

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