Mediterranean PP players expect stable prices from Middle East in October

Import PP markets in Turkey and Egypt have been tracking a mainly stable trend since the beginning of September, with sellers maintaining their initial price levels despite slow market activity. In both markets, where Middle Eastern producers are the main supply sources, players are predicting that import prices will continue to track a mostly stable path next month as well. In Turkey, players have been reporting a limited number of supply sources from the region for some time. Indeed, Turkey has not been enjoying ample supplies from Saudi Arabia since the start of this month, which was confirmed by the recent news that Saudi Arabia’s Petro Rabigh, who has a total PP capacity of 700,000 tpa, reduced its usual polymer allocation in September and again by half for October as a result of an August outage. Currently, Turkish players are waiting for October price announcements from regular suppliers, with expectations being concentrated on stable prices depending on the supply situation for next month. Theoretical calculations based on October homo-PP offers from the Middle East to China also indicate that the prevailing levels in Turkey are free from major pressure from other global markets, while Turkish buyers also note the lower spot propylene prices in Asia. Egyptian players, who were mainly away from the market in H1-September due to Eid holidays, also believe that new prices for October will come with rollovers in line with slow market activity which has not recovered fully after the holidays, plus the relatively lower oil prices. In light of the newly announced October prices from the Middle East to China, the current Middle Eastern level in Egypt is mostly in balance with prices to China on the high end for now.
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