Indonesian PP market moves down prior to Eid holiday
Demand weakens as holiday is around the corner
Demand for PP applications has been weak as the holiday mood has already started to dominate the market.
Several PP players have recently cited thin buying interest as the reason behind lower homo-PP prices, anticipating no improvement until the end of the holiday.
Ample supply adds to softening in PP
In addition to the stagnancy of demand, ample PP supplies in local and import markets have also reinforced the weakness.
A converter said, “We are not interested in making new purchases for now as we have sufficient stocks. Plus, buying interest is thin and PP prices are on a downtrend.”
Import PP also under pressure from trade tensions, lower oil
In addition to weak supply-demand dynamics, rising trade tension between China and the US and the notable losses in crude oil futures over the past week have also put further pressure on the import market sentiment.
According to ChemOrbis Price Index, import prices in Southeast Asia have been softening for the past four weeks.
Sellers are open to give discounts on local deals
The lack of support both from the demand and supply side has pushed sellers to give discounts on deals.
“Suppliers are ready to concede to discounts on PP deals as they are holding high stocks and seeing limited interest,” a woven bag manufacturer commented.
Local producer cuts homo- PP offers after two months
A local producer cut its new offers for homo-PP grades by IDR 230,000-240,000/ton ($16-17/ton) when compared to last week. This has been the first price cut of the producer since early April.
Local homo-PP market sinks to 11-week low
According to the weekly average data obtained from ChemOrbis Price Index, the local homo-PP market in Indonesia has recently reached its lowest levels since early March.
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