PP offers for January shipment are increased further

26-Dec-08

As demand from China continues to sound, firmness in the polypropylene markets has persisted, with CFR China January shipment deals getting concluded at US$785/MT CFR China. After successful deal conclusion at these levels, seller's offers have been hiked by about 10-15 dollars. Polypropylene prices could witness price correction as feedstock propylene prices have witnessed a fall this week. Chinese buyers who have sufficient stockpiles for the month are refraining from further deal conclusion on the expectation that prices would fall. If deteriorating crude oil prices plummet naphtha prices with them, producers could increase run rates at steam crackers, augmenting propylene production and leading to a price dip. Despite CFR China sellers offers having climbed down to US$525/MT, buying has been slow as interest has been witnessed about 30 dollars lower.