SE Asia’s import homo PP market preserves premium over China

Players in China’s import homo PP market reported that re-exporting activities have been continuing since the end of the Chinese New Year as supplies are still high in China despite a slight reduction while demand is yet to improve. Meanwhile, Southeast Asia remains to be Chinese players’ preference as an export outlet considering better netback opportunities.

According to data obtained from ChemOrbis Price Wizard, Southeast Asia’s import homo PP market sustained its premium over China, currently standing $75/ton above China on average. This premium has somewhat decreased when compared to a month before; however, Southeast Asia still offers better netback to both Chinese and overseas sellers even after the freight differentials are extracted.



Source: ChemOrbis Price Wizard

A Chinese trader commented, “Despite the maintenance season and the local producers’ slightly lower stocks, inventories are still high in China. Firmer crude oil prices also yet to support the market sentiment so far. Therefore, traders are still willing to re-export their cargoes to Southeast Asia in order to receive better netbacks.”

Another Chinese trader offering US origin to the Vietnamese market noted, “In the last few months, we have sold more than 3,000 tons of PP cargoes to Southeast Asia.”