Saudi Arabia considers restricting PP exports from local resellers

There has been a recent discussion about the new pricing mechanism Saudi Arabia considers for PP buyers. The kingdom considers possible limitations on export PP sales through unlicensed sales channels. This has fuelled some confusion among players both locally and regionally.

Sources close to the matter informed that the kingdom is aiming to restrict the exports from the sales channels other than the producers in a bid to avoid the abuse of competitive prices provided to local customers, as it creates unfair competition in export markets.

In other words, they are trying to prevent local traders, distributors and even converters - who obtain PP prices with special discounts - from reselling their products abroad at low prices.

Although there is no decision taken yet officially, several measures are under consideration, sources said.

Market players are waiting for clarity on this matter with some arguing that this year is the trial period. Both producers and buyers will need to see the implementation, hoping to find more details in the next few months. Meanwhile, the news has already found reflection on the nearby markets with higher prices, creating concerns over supply flows.