Vietnam’s PP market yet to respond to firming trend in China
Sept. 27, 2018
China’s local homo-PP market has been following an increasing trend for the past three weeks due to supply tightness driven by several planned and unplanned shutdowns. The upturn has also found support from strong futures prices and replenishment activities ahead of the National Day holiday to take place by early October. China’s import-homo-PP market has also followed suit this week after remaining on a stable to softer note since-mid August.
However, homo-PP prices in Vietnam are unresponsive to the firming in the nearby Chinese market for now mainly due to the ongoing stagnancy of demand. As can be seen in the below graph created by ChemOrbis Price Wizard, the weekly average of Vietnam’s local homo-PP market has been following a mostly stable trend for more than a month.
The sentiment in Vietnam’s import homo-PP market has also remained weak within this period. Parity fluctuations amid the mounting trade tension between China and the US are keeping buyers on the sidelines. Meanwhile, supply concerns over new capacities across Southeast Asia are also weighing on the market. Commercial outputs from new plants of Vietnam’s Nghi Son Refinery and Petrochemicals, Malaysia’s Lotte Chemical Titan and South Korea’s S-Oil have already found their way to the Asian PP markets at mostly competitive levels.
A few converters opined, “PP prices in Vietnam are mostly steady this week despite the firming trend in China’s PP market. We don’t expect to see an upward movement in prices as buyers keep their purchases limited to their urgent needs.”