PP buying interest picks up on low stocks in Turkey
According to ChemOrbis, players in Turkey have recently started to report a pick-up in buying interest in the PP market, particularly for homo PP, after months of stagnant trading activities in the midst of steadily falling prices. Low stock levels on the buyers’ side mainly prompted the buying interest as they had avoided building stocks owing to their thin end product orders. Due to the revival in buying interest, players are now questioning whether this will be followed by supply concerns regarding promptly available cargoes with some already reporting limitations in availability.
“We have started to receive calls this week even from our customers who had not been calling for two months. This is because the stocks in the Gaziantep area have almost dried up,” said a trader. Making similar comments, a second trader told a buyer, “We have sold out our Saudi PP allocation smoothly in the past few days.”
Carpet and bcf makers in Gaziantep also acknowledge returning to the market with a fresh buying appetite albeit with some reservations, according to ChemOrbis. They still claim not seeing an improvement in their end product orders although their high season should have kicked off by now. “We are interested in securing some cargoes as we have run out of stocks, not because of future orders. Therefore, this revival in buying interest may fade in the second half of the month,” said a bcf maker.
More than a few buyers also reported making inquiries because of the recent gains of crude oil, wondering whether firmer energy prices will help reverse the market trend.
“Some sellers have already started to firm up their stance,” said a buyer. “We shook hands for Iranian fibre with a trader, but we are yet to receive the pro forma invoice,” commented another buyer.
Prompt availability is already tight, according to players. “Petkim reduced its list prices by $40/ton; however, we are not planning to reflect this decrease on our prices due to the limitations of supply and resumed buying interest,” said a distributor.
“The outlook is becoming blurry. The downturn is likely to lose pace or even come to a halt, although it is too early to say that it may shift direction unless China regains some lost ground,” commented a market player.