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Players: Regional PP origins gaining competitiveness in SEA

by ChemOrbis Editorial Team -
  • 30/07/2015 (18:07)
Players operating in Southeast Asia’s PP markets report that regional producers have taken a more aggressive stance in the market recently in order to defend their market share against possible re-exports from the nearby Chinese market.

Import homo-PP injection and raffia prices currently stand at $1135-1230/ton CIF SEA, cash equivalent basis, with offers for dutiable Middle Eastern and Indian origins standing at $1135-1170/ton and offers for non-dutiable Southeast Asian materials standing at $1180-1230/ton. Offers for dutiable origins were primarily concentrated in Vietnam, which has a customs duty of 2% rather than the 5-10% duties which obtain elsewhere in the region. Intra-ASEAN cargoes are exempted from duties under the terms of the ASEAN free trade agreement.

A converter in Indonesia said that they received offers for Thai homo-PP at $1225/ton CIF for injection and raffia and at $1265/ton for film. “We find these offers to be more competitive than Middle Eastern offers subject to 10% customs duty. However, we still plan to wait before making any fresh purchases as we are feeling comfortable with our stock levels while we believe that prices may still have some additional room to decline,” the buyer commented.

A trader offering Thai raffia and injection at $1200/ton CIF Indonesia/Vietnam commented, “We are hoping to increase our sales in the Indonesian market now that players there are returning from their recent holidays. Although we reduced our prices on the week, buying interest remains limited.” A trader offering Indian raffia to the Philippines at $1170/ton CIF, subject to 10% customs duty, stated, “Most buyers are sourcing their needs from the local market these days and there is very limited interest in import materials.”

Meanwhile, a trader in China offering Saudi Arabian homo-PP at $1130-1150/ton CFR China, cash commented, “We are considering re-exporting to Southeast Asia, but the price gap between the regions is not currently large enough to justify the additional expenses. Demand from the Chinese market is quite discouraging these days.” A trader in Malaysia reported receiving an offer for coal based Chinese raffia at $1190/ton CIF, cash. “We are hesitant to purchase as we are not familiar with this origin and have never previously imported from China. Our logistics providers tell us that shipping costs from China to Malaysia come to around $100 for a 20 foot container,” the trader stated.
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