Import PP turns softer in China
Sept. 10, 2018
In China, the import PP market witnessed decreases in the first week of September mainly due to tepid demand amid growing trade tension with the US. Local prices, on the other hand, followed a mostly stable trend after facing downward corrections for the past two weeks.
The overall range for import homo-PP raffia prices were $10/ton lower on both ends when compared to last week at $1220-1250/ton CIF, cash. Players remained sidelined in order to avoid risks stemming from parity fluctuations. “Although offers at this week’s low end are reasonable, they don’t see any interest as buyers refrain from making import purchases or limit their purchases based on their needs. This is because of the depreciating yuan against the USD in the midst of escalating trade tensions. We think that impacts the trade tension will continue to weigh on the sentiment in the days ahead” a few traders noted.
Local prices for homo-PP raffia mostly hovered around at last week’s levels. PP futures on the Dalian Commodity Exchange were also mostly stable on the week as of September 6. Demand remained stagnant given the uncertainty related to the trade tension. Supplies, meanwhile, were reportedly increasing in the face of buyers’ cautious stance and limited purchasing amounts. A trader commented, “The futures market is volatile and local prices are mostly stable this week. We prefer to remain cautious as we are concerned about the escalating trade war. ”
PP prices are expected to follow a stable to softer trend in the days to come mainly due to weak demand as well as increasing local supplies. Market activity is likely to remain under pressure from lingering parity fluctuations despite the traditional high-season.