This week, Polypropylene prices declined in some parts of Asia.
An industry source in Asia on condition of anonymity informed a Polymerupdate team member, “As weakening of demand for oil products continues to be a chronic cause of concern for global markets, prices have declined to their lowest levels in recent times. Furthermore, the downside risk to oil prices is likely to intensify with the likely resumption of oil production and exports from Libya following a UN-brokered deal between rival political factions. Meanwhile, demand continues to remain moderately healthy with participants preferring to make low-priced purchases on an as-required basis.”
The source added, “Weak demand sentiments imply that Asian buyers are not likely to rush into making import purchases in spite of prices temporarily hitting the floor.”
In Far East Asia, PP raffia and PP injection prices were assessed at the USD 885-920/mt CFR levels, both week on week decreased by USD (-5/-10/mt). PP film and BOPP prices were assessed at the USD 895-930/mt CFR levels, a fall of USD (-5/-10/mt) from the previous week. PP block copolymer prices were assessed at the USD 910-940/mt CFR levels, lower by USD (-10/mt) from last week.
In China, Middle Eastern producers have offered their PP raffia and injection grades in the range of USD 885-920/mt levels, for shipment in September 2024.
In China, the cost support for PP has been weakening amid global oil prices declining to their lowest levels in the year. The bearish situation has been further compounded by an anticipated rise in supply pressure with Jincheng Petrochemical likely to commence trial operations at its PP plant. There has been no pickup in demand along expected lines, indicating a tepid market outlook. Meanwhile, the rising possibility of the peak season being delayed could adversely impact market sentiment in the near to medium term. A week on week drop in PP futures on the Dalian Commodity Exchange (DCE) further pushed prices lower in the region.
In India, PP raffia and PP injection prices were assessed at the USD 980-1010/mt CFR levels, both down USD (-10/-20/mt) from the previous week. PP film and BOPP prices were assessed at the USD 1000-1030/mt CFR levels, both week on week declined by USD (-10/-20/mt). PP block copolymer prices were assessed at the USD 1020-1050/mt CFR levels, a drop of USD (-10/-20/mt) from last week.
In India, Middle Eastern producers have offered their PP raffia and injection grades in the range of USD 980-1010/mt levels, for shipment in September 2024.
A domestic industry source informed a Polymerupdate team member, “Market sentiment was reportedly muted with prices declining on the back of lower import offers from overseas suppliers. Meanwhile, the Government of India has extended the Bureau of Indian Standards (BIS) certification mandate for PP imports till December 24, 2024.”
The source added, “Reliance Industries Limited reduced PP prices by Rs.2/kg basic, while DE prices have been reduced by Re.1/kg basic, with effect from September 1, 2024. Price protection has been withdrawn. Although freight rates have been reduced, transaction activity is not picking up for Chinese cargoes due to weak demand.”
The source further stated, “It has also been heard from market participants that Middle Eastern producers have set up bonded warehouses in India to ensure undisrupted supplies to local markets while attempting to mitigate the impact of delays in cargo arrivals caused by congestion and delays at Middle Eastern ports.”
In Sri Lanka, PP raffia and PP injection grade prices were assessed at the USD 1030-1070/mt CFR levels, both declined by USD (-10/mt) from the previous week. PP film and BOPP prices were assessed at the USD 1070-1100/mt CFR levels, both lower by USD (-10/mt) from the previous week. PP block copolymer prices were assessed at the USD 1090-1110/mt CFR levels, a week on week drop of USD (-10/mt). Lower import offers from overseas suppliers supported the price fall.
In Sri Lanka, Middle Eastern producers have offered their PP raffia and injection grades in the range of USD 1030-1070/mt levels, for shipment in September 2024.
In Bangladesh, PP raffia and PP injection prices were assessed at the USD 1010-1040/mt CFR levels, both down USD (-10/mt) from the previous week. PP film and BOPP prices were assessed at the USD 1030-1060/mt CFR levels, both week on week decreased by USD (-10/mt). PP block copolymer prices were assessed at the USD 1070-1120/mt CFR levels, a fall of USD (-10/mt) from last week.
In Bangladesh, market sentiment was assessed in the steady to soft range. The country, which continues to be in the throes of political turmoil, faced the prospects of paucity in material supplies with shipping lines expressing reservations about transporting material.
Meanwhile in Southeast Asia, PP raffia and PP injection grade prices were assessed at the USD 930-980/mt CFR levels, both constant from the previous week. PP film and BOPP prices were assessed at the USD 940-990/mt CFR levels, both stable week on week. PP block copolymer prices were assessed at the USD 970-1010/mt CFR levels, steady from last week.
PP prices retained a stable trend in southeast Asia though spot transactions remained limited this week. Although buyers remained adamant about making low-priced purchases, margin concerns drove producers to hold their offers firm. A consistent rise in upstream naphtha and propylene costs coupled with persistently increasing container freight rates has compressed the export netbacks of PP producers, driving them to explore trade opportunities in domestic markets.
In Pakistan, PP raffia and PP injection grade prices were assessed at the USD 1010-1040/mt levels, both rolled over from the previous week. PP film and BOPP prices were assessed at the USD 1030-1070/mt CFR levels, both stable week on week. PP block copolymer prices were assessed flat at the USD 1040-1100/mt CFR levels.
In Pakistan, market sentiment has been adversely impacted by heavy rainfall. Inflationary pressures and limited offers have further contributed to the downturn.
Feedstock propylene prices on Tuesday were assessed at the USD 860-870/mt CFR China levels, while FOB Korea propylene prices were assessed at the USD 835-845/mt levels, both higher by USD (+5/mt) from last week.
In plant news, Shandong Chambroad Sinopoly New Material has restarted its No. 2 Polypropylene (PP) plant in early September 2024. It was shut for maintenance on August 7, 2024. Located in Binzhou, China, the No.2 plant has a production capacity of 200,000 mt/year.
Yanlian Petrochemical Company has resumed production at its No.1 polypropylene (PP) unit in early September 2024. The unit was shut for maintenance on August 10, 2024. Located in Yan’an, China, the No.1 unit has a production capacity of 100,000 mt/year.
Fujian Refining and Petrochemical is likely to shut down its polypropylene (PP) units for maintenance in early November 2024. Further details on the duration of the shutdown could not be ascertained. Located in Quanzhou, China, the units have a production capacity of 700,000 mt/year.
