Pre-buying activity occurs in Turkey’s PP market prior to holiday
A big bag converter reported buying around 150 tons of homo PP this week, saying, “PP prices are likely to move up a bit right after the Eid Holiday as sellers voice their rising price targets citing higher propylene costs. Considering the fact that they will need to improve their low margins, we purchased some amount before the long holiday starts.”
A packager also reported planning to buy some amount as he was running out of stocks recently. “Our end business is doing okay these days and thus we will buy some quantities, albeit in a limited amount, to sustain our operations. We did not receive many offers so far this week though.”
“We lifted our homo PP raffia prices by $20-30/ton for Saudi Arabian cargos when compared to August as we feel no stock pressure right now due to a nearing maintenance at our production site in October-November. We expect to get more inquiries this week as buyers may need to meet their needs before holidays,” a source at a global producer stated.
A bcf maker attributed higher price levels to fewer cargos from Iran recently. “PP prices moved higher to some extent as Iranian suppliers are not that active in the market given the Eid Holiday in the region. Yet, we expect to obtain a slight discount for Saudi Arabian origins as PP fiber prices at or close to the high end are not workable and the future trend in China is a bit cloudy amidst the slow economy and higher monomer costs.”
On the other hand, a carpet maker is not willing to accept price hikes for September. He said, “We will push for rollovers, if not discounts, as prices in Turkey are not that much below the levels in China. Plus, financial turmoil still persists in Turkey.”
In the local PP market, competitive done deals were reported for Uzbek homo PP materials. “We heard raffia converters concluded purchases for this origin at attractive prices. The distribution market has been on a rebound since the last two weeks which generated more buying interest and negotiations this week,” a distributor remarked.
Now, players are divided about the post-holiday scene. Some players expect sellers to issue additional hikes, particularly on the lower ends of the market, as they have been experiencing low netbacks in Turkey for a while. However, others comment, “Sellers raised their prices and some of them warned us that additional increases are about to come after the Eid Holidays. However, we still think that demand is not strong enough to support a long lasting firming trend in Turkey.”
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