Polymer players evaluate market outlook after coup attempt in Turkey

Turkish polymer players started to evaluate the possible impacts on the market of a military coup attempt that appeared on Friday, July 15 2016, with initial opinions diverging. According to some players, it is early to make predictions as of the first working day of the week and think it’s best to wait some time in order to get a better clue about the outlook.

According to media reports, Iran’s petrochemical and polymer product exports to Turkey were temporary halted on Saturday due to the border closure between the two countries following the coup attempt. However, this information was not confirmed by primary sources in Turkey at the time of publication.

A PP trader commented, “Buyers may step out of the market. Sellers will be more cautious as well for cash against documents (CAD) since banks may take some financial precautions following the recent events. Anyways, we were not expecting to see sharp price hikes this month already, even before the recent events.” A PP and PE seller similarly commented, “The atmosphere is quite cloudy right now and we have received no inquiries from buyers. Sellers may need to wait for 1-2 weeks to see the market situation before setting their price levels assuming that demand may be hindered.”

In the meantime, other players do not expect the recent incidents to affect the market much over the short term. A PVC supplier reported that players are busy making their payments as of early this week, while the market may not be affected much, particularly since the dollar/TL exchange rate hovers at 2.95. The US dollar moved above 3.0150 TL right after the coup attempt news, before coming down to below 2.93 early on Monday. By mid-day, the USD/TL exchange rate moved above 2.95 once again.

“We received a few inquiries in spite of the generally calm atmosphere. Polymer markets may be influenced by the impact of the exchange rate and we will probably have to wait this week to see the outlook more clearly,” another PVC seller noted.

A trader said, “The developments don’t seem to have affected the market as much as we would expect, although there might be some medium term effects on investments and tourism which could have an impact on the economy.”

“We expect polymer markets to follow a firm trend until September and we maintain our positive expectations like before the recent crisis. Afterwards, the market may see some downturn considering the supply-demand balance. The direction for PS will depend on crude oil and the policy of Iranian sources,” a distributor opined.