Indonesian players: Local PP raffia supplies tight
A trader commented, “Raffia supplies are quite limited these days as a local producer is running their plant with reduced rates while demand has improved. Hence, distributors are increasing their PP offers to the local market.”
A converter reported that he has not been able to find any local PP offers since last week. “It seems that sellers are holding onto their stocks as they believe that prices will see fresh increases soon. We see very good demand for our end products nowadays and we are planning to secure some PP cargoes in the days ahead.”
A second converter added, “Demand for our end products is gradually improving these days. However, local supplies for homo-PP raffia are quite limited. Hence, we feel that PP prices will witness additional increases in the near term.”
Meanwhile, a source from a local producer reported, “Demand is good while availability is short in the country. We heard that a local producer started to run their cracker at full capacity yesterday while they had already restarted their PP lines. Our plant is currently operating at normal rates while we have started to receive more inquiries from our customers recently. For the near term, we believe that the current firming trend will prove sustainable on the back of supply limitations as well as Indonesia’s better economic outlook when compared to last year.”
In Indonesia, local homo-PP raffia prices on dollar terms currently stand at $1050-1160/ton on an FD, cash equivalent basis. The high end of the range indicates an increase of around $50/ton when compared to the previous week. According to data from ChemOrbis Price Index, local homo-PP raffia prices are currently standing at their highest levels since November 2015.
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