Saudi PPH raffia in China drops below $900 CIF for first time in 4 months

Players in China’s import PP market reported that homo-PP offers from Saudi Arabian suppliers witnessed a fresh round of drops compared to last week amid falling crude oil prices and weak demand. Middle Eastern offers for homo-PP raffia and inj. have been on a stable to softer trajectory since late June, according to ChemOrbis Price Index data. The latest discounts have taken prices back to late March levels, when offers below the CIF $900/ton threshold were last seen.

On July 29, an agent of a major Saudi Arabian producer informed that their PP offers to China for August shipments were down by $40/ton compared to July levels at $890/ton on CIF, cash basis.

Similarly, a Chinese trader reported they received homo-PP offers from Saudi Arabian suppliers with a slight decline of $10/ton from last week, pulling prices to CIF $890-910/ton range.

“The decline in PP markets has been ongoing for nearly a month along with falling crude oil prices. Nevertheless, we still maintain the view of waiting for a stable oil price to seize buying opportunities at low prices. From a macro perspective, the market is primarily trading on expectations of a US economic recession and weak Chinese demand. However, considering the revised US GDP growth rate for Q2, which is at a healthy 2.8%, and the good performance of various inflation indicators, the situation appears less dire. Chinese demand is indeed weak, which is also typical for the off-season. For now, we will continue to monitor the market for buying opportunities at lower prices,” commented the trader.