Import homo-PP prices in Indonesia have posted a fresh round of losses as the last week of November edges to a close. Several Southeast Asian producers have already revealed lower offers to the country for December, which was not surprising according to many players.
Recently, import homo-PP prices in Indonesia have reached their lowest levels since mid-November 2017, ChemOrbis Price Index shows. The market has been stuck in a relentless down trend since the second half of October and has lost almost $150/ton since then. A large portion of this decrease has occurred this week.
The downtrend in neighboring China, the ongoing losses in spot propylene prices in Asia and slumping crude oil futures were cited as factors pulling prices further down.
According to ChemOrbis Price Wizard, the weekly average of FOB Korea based spot propylene prices has marked their weakest levels since early July 2017 while WTI and Brent crude oil futures have remained on downtrend since early October 2018.
The PP market is also not able to find support from the demand side as buyers mostly preferred to stay on the sidelines in anticipation of seeing further drops.
A Chinese trader reported that their homo-PP raffia offers to the country indicated a weekly decrease of $125/ton and commented, “The PP market has remained under downward pressure recently. Although we significantly cut our offers this week, buying interest is still dull given lower propylene prices and crude oil futures.”
Indonesia is the second largest homo PP market among Southeast Asian countries in terms of imports. In 2017, more than 730,000 tons of homo PP imports were reported while the overall import PP market size breached the 1 million ton-threshold once copolymer imports were added.