China’s import homo-PP range hits a new low end
Prices below the $1050/ton threshold have started to emerge in the face of weaker crude oil prices, which broke below the $50/barrel threshold on the NYMEX, as well as declining PP futures prices on the Dalian Commodity Exchange.
May PP futures on the Dalian Commodity Exchange closed CNY297/ton ($48/ton) lower at CNY7150/ton ($995/ton without VAT) on January 9 while PP futures are down CNY447/ton ($72/ton) when compared to the first working day of 2015.
A Shanghai-based trader reported that they purchased some import homo-PP raffia from an Indian supplier at $1030/ton CFR, cash. He commented, “Sentiment remains weak as buyers are still waiting on the sidelines in anticipation of seeing further decreases as crude oil prices are persistently moving downward. Traders are cautious about their purchases as they find it risky to build large stocks given the ongoing softening trend as well as the approaching Chinese New Year holidays. We are not feeling optimistic regarding the demand outlook even after the holidays.” The trader added that they were offered Saudi Arabian homo-PP raffia at $1050/ton on a CFR China, 90 days deferred payment basis.
A second trader based in Shanghai also reported receiving import raffia offers for Indian origins at $1050-1070/ton CFR, 90 days. “Buyers are not interested in purchasing nowadays as prices are not showing any signals of stabilizing over the near term. Futures prices are moving lower after following a steady trend in the last week of December while the PP market is also facing downward pressure from coal-based capacities. Everybody is trying to keep their stock levels low in order to minimize their risks and we are not feeling optimistic about the outlook for the first half of the new year.”
In China, import homo-PP raffia prices for both dutiable and non-dutiable origins are currently being reported at $1030-1200/ton CFR China, cash equivalent basis.
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