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Vietnam PP market yet to respond to faltering upturn in China

by Pınar Polat - ppolat@chemorbis.com
  • 22/07/2019 (04:01)
According to ChemOrbis Price Index, Vietnam’s local and import homo-PP markets extended gains into the fourth week after bottoming out in mid-June. Players are now wondering whether the firming trend in Vietnam will be sustained as the sentiment in China PP market has faltered recently.



What do Vietnam PP market owe this month-long firming to?

Good demand for PP applications and low inventories were cited as the main factors pushing Vietnam PP market up for the past one month.

Despite the recent softening in China PP market, hike attempts for homo-PP raffia continued in Vietnam this past week, with sellers applying weekly increases of up to $30/ton.

China’s local PP market shifts direction after three weeks

After remaining on the firm side since late June, China’s local PP market has turned softer mainly due to lower PP futures on the Dalian Commodity Exchange, which lost around 1.5% from July 15 to July 19.

Apart from the lack of support from futures, slightly higher local polyolefin supplies and weaker crude oil futures have also weighed on the PP sentiment in China.

Meanwhile, the upcoming new PP capacities inside China in H2 2019 keep the market outlook under pressure over the medium-term.

China casts cloud over the uptrend in Vietnam PP market

The softening in China PP market and the weakening in crude oil futures have pushed Vietnamese players to question whether the month-long firming trend in the country’s PP market will be sustained during the remaining weeks of July.

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