Global PP Players: Main Supply Sources Out of the Market13 Jan 2011 • by Natalie Aster
In PP markets in Turkey, Italy, China and Southeast Asia, players have been reporting a limited number of supply sources from overseas countries moving into the second week of the month.
In Turkey, where Middle Eastern origins are considered to be the main supply sources, buyers and distributors are still awaiting major Middle Eastern suppliers to come with their new offers. “Saudi Arabian producers are not offering any material to Turkey for January yet,” a fibre converter reported this week while a trader also confirmed the situation by saying that he hasn’t been able to receive any offers yet although he has called Saudi Arabian producers.
The Italian market, where PP prices rose more than €100/ton this month, is also seeing a limited number of non-European origins this month. Although hefty price hikes on local prices caused Italian PP buyers to turn to the import market in order to look for non-European materials, almost no import activity was reported this week due to the absence of non-European supply sources. A distributor offering a Middle Eastern origin reported this week that they have very limited quantity to offer this month due to the previous production problems at their suppliers’ plant. The seller, who is standing at the top end of the spot homo PP price range, said they are asking for a €130/ton increase for their tight availability this month although they are aware that their current price is unworkably high.
According to the data from the Department of Statistics and Information, Saudi Arabia’s petrochemical exports reached an eight month high in November supported by the strong demand from China, India and other Asian countries, which may partly explain reports of tight availability from Saudi Arabia.
Asian PP markets are facing a similar situation. In Southeast Asia, players have been reporting widespread concerns about a further tightening in supplies following the Chinese New Year. In China, PP producers are considered to be taking a waiting stance due to thin market activity. The country’s import market saw few offers this week from overseas producers with only a couple of sellers offering Middle Eastern and Indian materials. The buyers of Indian cargoes reported that they were offered at prices at least $50/ton higher for March shipment cargoes due to a scheduled shutdown at the suppliers’ plant. According to market sources, India’s Reliance is planning to shut its Jamnagar plant with 1.1 million tons/year PP capacity for maintenance in the second week of February.