Morning Briefing - 27 September 2022
CommoPlast
Morning Briefing
27 September 2022
Brent: $84.06 (- $2.09）
WTI: $76.71 (- $2.03)
Naphtha CFR Japan: $648 (- $25)
Ethylene CFR NEA: $900 (Stable)
Ethylene CFR SEA: $910 (Stable)
Propylene FOB Korea: $875 (Stable)
Propylene CFR China: $895 (Stable)
*Data represent closing prices of the previous trading day
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After a major South Korean producer surprised the market last week with competitive homo-PP offers to Vietnam, this week, another maker followed the step, offering yarn cargoes at $1030/ton CIF Vietnam, LC AS term. The non-dutiable cargo is more competitive than most other origins, which stirs the concerns that the recent uptrend might have stagnated
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After the Federal Reserve lifted the key interest rate by 0.75 per cent last week while signalling more hikes to come, Asia currencies weakened steeply, which make imports more expensive. Industry participants said that without intervention from central banks, Asian currencies might depreciate further.
Exchange rates would not be an issue if local suppliers could lift offers in tandem. At the moment, increasing prices proved to be easier said than done.
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Over the weekend, a major Indonesian producer lifted spot PP and PE offers to domestic buyers on the back of a stronger import market and the sharp depreciation of the Rupiah against the US dollar.
It is expected that trading activities would decline as prices firm up as most buyers have made comfortable replenishment. Meanwhile, the renewed price war in the end-product market, especially PE packaging, would likely keep customers on the sidelines.
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