Saudi raffia offers touch $1000 CIF threshold in China, is it the peak?
The overall range for Middle East raffia is currently standing at $970-1000/ton on CIF China, cash basis. The range has been flat to $10/ton higher when compared to last week.
Questions arise over a peak
After opening the post-lengthy National Day holiday period on a firm note, import PP markets have managed to stand firm since then on the back of limited availability from overseas suppliers amid turnarounds as well as robust demand during the high season.
However, players have been wondering about whether prices are about to reach or have already reached their peak levels as the high season has neared an end. Some players also believe that the impact of the import tightness will be counterbalanced by the new PP capacities set to be launched in China.
Market offers a mixed bag
An agent of a major Saudi Arabian producer reported that their supplier announced its November PP raffia offers to China with a $50/ton increase from their October levels at $1000/ton CIF, cash.
He commented, “Despite the monthly increases, there has been a weakness in the import PP market since last week. We think that prices have already hit the peak level and will go down. As the current offer levels are too high to see acceptance, demand remains limited to buyers’ needs. With the high season stretching from September to October coming to an end soon, we don’t expect to see strong demand in the near term.”
A few traders, on the other hand, reported that their offers for import homo-PP raffia have already eased slightly so far this week and opined, “Demand has been moderate in the recent days after several weeks of active buying. For tightness, we think that it might be offset by continuous arrival of import cargoes and new capacities coming on stream. We prefer to be cautious about the near-term outlook.”
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