China’s PP export window opens wider on lower freights, SEA supply crunch

China’s export homo-PP raffia and injection market has experienced a stable-to-firmer trend recently, driven by a confluence of factors such as declining freight rates and supply constraints in key regions, particularly Southeast Asia. Increasing export orders have further reinforced this trend, with some exporters selling out February allocations, underscoring heightened appetite for Chinese-origin PP.

Export prices at highest since Dec

Last week, export prices for homo-PP raffia and inj. saw rollovers to slight increases of $10/ton on a weekly basis. This pushed the weekly midpoint to its highest level since the second half of December 2024, according to data from ChemOrbis Price Index. While most Chinese exporters have refrained from applying additional hikes this week, with prices mainly moving sideways, players noted that current levels remain workable for buyers.

Domestic oversupply fuels export efforts

Following the Spring Festival, China’s domestic PP market has seen a huge accumulation of inventories, prompting producers to ramp up exports to mitigate local supply pressure. The oversupply situation has been exacerbated by the addition of new production capacities. ChemOrbis Production News Pro reveals that three local PP units, with a combined capacity of 1.3 million tons/year reached on-spec production in H2 January.

In the meantime, lingering tepid demand at home has slowed inventory drawdowns, forcing suppliers to seek export markets to balance the supply-demand equation. According to market sources, the combined polyolefin inventory of two major local producers remained ample at 880,000 tons as of February 19, indicating a decrease of only 80,000 tons within the past two weeks.

Falling freights, reducing supply in SEA boost exports

While a supply overhang at home has served as a significant motivation for suppliers to divert shipments to overseas markets, falling freight rates and a weaker yuan have opened a significant export window for China’s homo-PP.

A trader commented, “Freight rates have declined over January and February, enhancing the competitiveness of Chinese PP exports. Export orders have increased, with more inquiries from Southeast Asian buyers.”

Besides, an ongoing shortage of supply in primary outlets like Southeast Asia has strengthened the position of Chinese sellers. Southeast Asia’s PP markets have witnessed supply tightness due to planned and unplanned shutdowns, as well as indefinite closures driven by profitability concerns among regional producers, alongside the ongoing maintenance season in the Middle East. These developments have encouraged Chinese exporters to increase shipments to the region.

• Vietnam’s Long Son Petrochemicals shut its cracker and downstream units in mid-October 2024 due to margin issues. Initially expected to restart in late December, the units are now likely to remain offline for most of 2025. The complex includes a 400,000 tons/year PP plant.


• The Philippines’ JG Summit Petrochemicals shut its Batangas cracker and downstream units in mid-December. While the company initially planned a March restart, the shutdown has been extended indefinitely due to profitability challenges. The site houses a 300,000 tons/year PP plant.


• In Malaysia, Lotte Chemical shut some PP and PE downstream units in Pasir Gudang in January amid low margins.


• Meanwhile, Vietnam’s Hyosung Corp. is set to shut its PP complex in February for planned maintenance, which is expected to last 30 days.


• Additionally, PRefChem experienced an unplanned shutdown at its No. 2 PP unit in February. The unit has a 450,000 tons/year capacity.

Indeed, an increasing number of Chinese-origin homo-PP raffia and inj. offers have emerged in Vietnam, China’s leading PP buyer, since last week. The lowest offers were reported at $945/ton CIF, while a deal has been concluded at $960/ton CIF Vietnam, cash so far this week.