In Southeast Asia, both import and local PP prices have moved higher in the first week after the Chinese New Year holidays as per the pricing service of ChemOrbis. Players cited stronger propylene feedstock costs along with firming prices in the nearby Chinese market as the main reasons for the rise in prices. Demand is said to be normal following the holidays although buyers holding comfortable stock levels have generally been hesitant to purchase in large quantities due to the cloudy market outlook.
“We lost some production in January because of the power outage in Al-Jubail and may need to delay some of our shipments, although our production is back to normal now,” reported a source at a Saudi Arabian producer who announced higher February prices to Malaysia at the start of this week.
“We left our prices unchanged after the holidays but we have heard that several other producers have already begun to announce higher prices for February,” commented a source at a Southeast Asian producer. “The market remains quiet this week as many buyers are still in a holiday mood and do not want to purchase,” the source added.
A trader offering Vietnamese homo-PP stated, “We are looking to achieve significant increases on our February prices given firmer propylene feedstock costs and rising regional trends. We have not given official offers yet except for some buyers in Indonesia and Thailand. The market is still mostly quiet this week. However, we have already received some bids at levels close to our February sell ideas.”
“We believe that prices will continue to move higher over the short term along with rising propylene costs and limited overseas supplies. We purchased 100 tons of Saudi Arabian raffia from the import market and 200 tons of domestic material from the local market this week and will have enough material in stock to cover our needs until April once we take delivery of these cargoes,” a woven bag manufacturer in Indonesia reported.
A Vietnamese converter manufacturing plastic containers stated, “We expect to see firmer prices over the near term but feel that prices may begin to level off soon as demand is not healthy enough to support another round of large price increases.”
“We purchased 50 tons of Middle Eastern homo-PP injection and 74 tons of PP block copolymer from the same source and are not looking to make any additional purchases for now as we are feeling comfortable with our stock levels,” the converter added.