Indonesia PP markets hold firm on tight availability
According to the ChemOrbis Price Index, the weekly average of homo-PP raffia prices on CIF Indonesia basis is currently standing at $1045/ton, the highest level in the past year.
Homo-PP raffia prices on FD Indonesia basis, meanwhile, are standing at $1183/ton on average currently and indicating the highest level since early February.
Supply tight across Southeast Asia amid turnarounds
ChemOrbis PP Production News show that supply has been tighter in Southeast Asia due to several plant turnarounds.
In addition to the ongoing shutdown at Lotte Chemical Titan’s 200,000 tons/year plant in Malaysia, Hyosung’s 300,000 tons/year unit in Vietnam has been shut due to technical issues while SCG Chemicals’ 400,000 tons/year plant in Thailand is due for turnaround this month.
Meanwhile, JG Summit Petrochemical’s 190,000 tons/year unit in the Philippines has recently been restarted.
Feedstock support from propylene
Although spot propylene prices on FOB Korea basis have edged down from $885/ton to $880/ton recently, they are still standing at their highest levels in the past ten months, ChemOrbis data reveal.
The high cost of feedstock is providing additional support to polypropylene prices.
Local producer ups PP offers steadily
A local producer in Indonesia has been applying a firm pricing on its PP offers since early September despite tepid demand amid the resurgence of COVID-19 infections as well as weak economic conditions.
Apart from tight supply conditions and firm propylene, the depreciation of rupiah against the US dollar has also pushed local prices higher.
A converter reported receiving raffia offers with a IDR550,000/ton ($38/ton) hike from two weeks ago at IDR17,500,000/ton ($1185/ton) FD Indonesia, cash basis.
“Although demand is still limited to buyers’ needs, local PP offers have remained firm due to tightness. Moreover, buyers have preferred to focus on the local market due to the weaker rupiah,” he said.
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