US PP offers competitive edge in China, Turkey
In the US, the local PP market is reported to track a softening trend in the face of weakening upstream costs and slow demand. According to market sources, weak dynamics in the domestic market are also exerting pressure on US suppliers’ export offers. Hence, sellers are looking for ways to sell their materials, especially to China, where import prices have recently hit their highest levels since August 2015.
The Chinese PP market, however, retreated from its 15-month high, witnessing some downward corrections of around $20-30/ton over the past week in line with a recent downturn in futures prices as well as the emergence of US PP offers at competitive levels.
A trader operating in China commented, “There are lots of US offers in the market with delivery in January. US suppliers are diverting their cargoes to major export markets, mainly to China, due to better netbacks.”
A second trader further added, “US sellers will focus on depleting their stocks in the near term given the approaching year end. Hence, they are now looking for profitable export destinations and China stands as an attractive option given the current high price levels.”
In Turkey, meanwhile, the firming PP trend which had been in place since mid-October lost steam over the past week in line with a cooling off Chinese market. As it was the case in China, a few traders operating in Turkey also reported the emergence of American PP offers at competitive levels. A trader reported concluding a deal for American homo-PP close to the low end of the overall import PP raffia range.
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