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Import delays support European PP suppliers in July

by Manolya Tufan - mtufan@chemorbis.com
  • 19/07/2021 (03:28)
In Northwest Europe and Italy, PP markets have followed a mostly stable to slightly firmer trend in July. Regional suppliers managed to take the edge off the impact of aggressive offers for Central European and non-European origins, supported by delayed imports.

Delays in cargo deliveries remain an issue

Delivery delays for import material amid logistical backlogs and snug supplies across the region provided European suppliers with an incentive to maintain or increase their prices for prompt material. Buyers returned to the local market to buy amid uncertain delivery times. That is to say, shipping delays kept the market relatively supported in July.

Import cargoes are delayed because of shipping issues across the board. In addition to high rates, a shortage of vessels and containers as well as port congestions caused delays in shipments.

Spot PPBC and PPH mainly follow divergent paths

July pricing policies diverged depending on the availability and starting level of the price negotiations in general.

Many European suppliers revised initial hike requests down to concede to rollovers for PPH, while specialty grades were sold above June levels amid ongoing tightness. PPBC grades saw hikes of up to €50/ton due to unresolved supply disruptions across the region.

Non-European PPH origins, however, were dealt with decreases of around €60-70/ton. July PPH deals for mainstream origins were mostly closed stable to softer amid comfortable supplies.

A trader also affirmed that PPBC deals indicated hikes as buyers are struggling to meet their needs, while PPH remained mostly flat amid competitive offers from other origins.

Central European, Mid-Eastern origins offer a competitive edge

In Italy, spot prices were assessed at €1830-1970/ton for PPH inj. and at €1900-2020/ton for PPBC inj. on FD, 60 days basis. In Northwest Europe, prices stood at €2000-2100/ton for PPH inj. and €2050-2150/ton for PPBC inj. with the same terms.

Non-European origins continued to offer a competitive edge compared to European prices. South African PPH inj. was offered at €1450-1500/ton FD Italy, 60 days. In Germany, Egyptian PPH inj. was sold at €1550/ton FD, 60 days. Hungarian PPH inj. was offered at €1880-1890/ton with the same terms.

In the import market, Emirati PPBC inj. was dealt at €1670-1680/ton DDP Italy, 60 days with delivery in mid-September. Meanwhile, South Korean PPBC was offered at €1730/ton DDP with delivery in September.

August calls for a stable to softer trend

According to many participants, August prices may be maintained with slowing demand during summer holidays on one hand and tightness for certain PP grades on the other. The ongoing uncertainty about the arrival of import cargoes keeps the outlook foggy, as a player put it.

Still, softer expectations are also voiced particularly in West Europe, where prices remained elevated amid a milder pressure from non-European origins. Buyers think that overall supplies in the local and import markets will improve next month. Players will also start leaving the market from next week ahead of the imminent start of summer vacations, while the reticence on the part of buyers will keep spot prices under pressure.
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