PP markets in Turkey, S East Asia move back above China by more than $100
In the case of Turkey, import homo PP prices traded at par with or below China for seven months starting from June 2016 to early February 2017, as can be seen from the graph prepared by ChemOrbis Price Wizard. The Turkish market gained its premium back over China in February and the premium has recently moved above $100/ton for the first time in a year.
Southeast Asia’s import PP market, meanwhile, has traded above China for most of the time during the past seven to eight months, unlike Turkey, albeit with a smaller-than-usual premium. Between June 2016 and February 2017, the premium mostly stayed at and below $50/ton although it has recently risen to more than $100/ton in the past two weeks.
Players are now questioning whether this recent premium of more than $100/ton will be sustainable or not in the near term. Some think that the softening in place in China’s PP market in the midst of high local stocks and falling futures market may cast a shadow on the firming trend seen both in Turkey and Southeast Asia.
Others, nevertheless, argue that supply concerns both in Turkey and Southeast Asia are more prominent in setting the tone of the market. “If they manage to remain indifferent to the downturn in China on the back of tightness issues throughout March, China may shift direction in April once high stocks are depleted,” argued some players.
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