Tanzanian and Kenyan buyers: Saudi producer lifts March prices
“The producer lifted their prices, but they do not hold many materials to supply. Meanwhile, another Middle Eastern producer withdrew from the Tanzanian market this month as they do not hold many supplies to offer. We are also still waiting to hear from a major Indian producer, but have not heard from them yet as the producer is reportedly having some production issues. On top these factors, South Korean offers seem to have disappeared from the market given the Chinese New Year holiday that took place in late February and tight supplies in Asia.”
The converter also highlighted the peak agricultural season for PP applications and underlined the supply issues for PP. “Players are rushing to find some PP cargoes to meet their needs,” he added
Meanwhile, in Kenya, the same major Saudi Arabian producer issued increases of around $70/ton for both PP and PE when compared to February, according to a converter. “However, the producer’s allocations are limited for this month. Previously, the decreasing trend had pushed buyers away from the market as they were hesitant to make fresh purchases given persistently falling prices. However, the increases seen on this month’s offer levels urged many buyers back to the market again. Seeing higher prices, players rushed to secure some cargoes ahead of possible further increases. Demand is slowly picking up and we anticipate better market activity as of next month. Therefore, we expect the stable to firmer trend to continue,” he stated.
The converter received offers at $1200/ton for PPBC injection, raffia and injection and $1170/ton for PP film on CIF Mombasa, Kenya, 90 days deferred payment basis. Meanwhile, the buyer received LLDPE film at $1250/ton, LDPE film at $1260/ton and HDPE film at $1240/ton with the same terms.
Meanwhile, another Kenyan converter also reported receiving $70/ton firmer HDPE and LLDPE film offers from a major Saudi producer at $1240/ton and $1250/ton on CIF, 90 days, respectively. The buyer also received PP film at $1170/ton with the same terms. He added, “The announcements came higher in line with expectations and on the back of tight supplies. We tried to secure some cargoes from the producer but they could not provide us any materials. We are not sure why the producer is giving notional levels if they have no allocations to sell. At the moment, demand is more or less steady while local supplies are tight. Therefore, we do not feel optimistic about the upcoming term.”
A trader, who offers on behalf of a major Saudi producer, also confirmed that the producer has very limited availability. Te trader offers Saudi cargoes at $1240/ton for HDPE film, $1250/ton for HDPE b/m, $1260/ton for HDPE inj., $1250-1280/ton for LDPE film, $1250/ton for LLDPE film, $1170/ton for PP film, $1150-1180/ton for PP inj. and $1150/ton for PP raffia on CIF Kenya, 90 days basis.
The trader commented that the Saudi producer does not hold much stock to offer this month while adding that demand is performing better. “Limited supplies are likely to hinder our sales,” he complained.
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