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PP re-exports from China to SEA falter

by ChemOrbis Editorial Team - content@chemorbis.com
  • 02/06/2017 (15:09)
Chinese traders have widely re-exported PP to Southeast Asia since the end of the Chinese New Year holiday due to their high inventories, benefiting from the higher prices in Southeast Asian markets. However, according to Chinese trader, re-export activities have diminished recently due to higher transportation costs as well as the stronger Chinese yuan against the USD.

A trader commented, “Transportation costs were only around $5-10/ton in February while it is around $25/ton nowadays. We have already stopped directing PP cargoes to Southeast Asia as the netback is not as favorable as before.”

Another trader said “Re-exporting cargoes from China to other markets is not as attractive as before considering the appreciation of the yuan against the USD recently.”

A third trader opined, “Chinese PP cargoes at $1070-1080/ton CIF SEA level are hard to re-export nowadays as the appreciating yuan causes export offers in USD terms to increase. In the Vietnamese market, other origins are already available at $1050/ton.”
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