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Aggressive PP offers from China continue to find way to Turkey, Vietnam

by Merve Sezgün - msezgun@chemorbis.com
  • 25/03/2021 (10:06)
Chinese PP producers have ramped up exports since January amid a combination of moderate demand at home and higher netbacks achievable in several outlets. Their competitive offers continue to find their way to Turkey and Vietnam this week.

Data from the General Administration of Customs reveal that China’s PP exports in January 2021 increased 26% month on month, while February PP exports were up 12% from January.

On the other hand, the country’s total PP imports were down 3% in January and 44% in February in month over month comparisons.

Chinese PP offered $150 below Saudi origins in Turkey

In H1 March, competitive offers from China played a crucial role in cushioning the meteoric price rally in Turkey’s PP markets. Players in the country started to receive irregular Chinese PPH offers in February amid an arbitrage window from Asia, while the increasing number of aggressive offers for this origin partially offset short allocations from regular suppliers.

Homo-PP raffia offers for Chinese origins were last reported at $1750-1780/ton CIF Turkey, cash. Saudi raffia was traded at around $1900/ton CIF for March.

As for homo-PP fibre, Chinese material has been offered at $1840-1850/ton CIF, while latest March deals for Saudi origins were concluded at around $2000/ton with the same terms. April PPH offers from the Middle East are not out yet, meanwhile.

Vietnam receives much lower offers for Chinese PPH

A similar scene was observed in Vietnam, which is China’s nearest destination to divert excess supplies.

Buyers in the country reported that they received homo-PP raffia offers from China at $1370-1410/ton CIF, cash. Latest March offers for the mainstream Middle Eastern origins into the country were standing at/above $1500/ton CIF.

Amid aggressive Chinese offers and mounting resistance on the buyers’ side toward multi-year high PP prices, Saudi origin PPH raffia for new shipments has been offered with a decrease at $1460/ton CIF Vietnam this week.

“Despite the pullback in prices, buyers continue to resist to our offers and expect further decreases. They prefer Chinese material which is offered at much lower levels,” a trader in Vietnam noted.
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