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Rising propylene prices maintain pressure on Asian PP producers

April 04/2012

(plasticsinfomart) -- Asian PP producers continue to face margin pressure even after announcing significant increases on their new April prices as spot propylene prices on an FOB Korea basis jumped higher over the past week to reach their highest levels since September 2011. 

PP producers are likely to face difficulty in persuading buyers to accept another round of price increases as converters are already offering resistance to sellers most recent price hikes.

Overseas PP producers active in China report that it will be difficult to press for further price increases for now as demand is not very encouraging and their higher initial April announcements have already been encountering resistance from buyers. A source at a Saudi Arabian producer complained, We would like to ask for another round of price increases but cannot do so for now as we are struggling to conclude deals at our current price levels. The bids we are receiving from our customers stand well below our new April prices.

Another Saudi Arabian producer expressed a bearish outlook for the coming month even after they managed to conclude some deals at their new April prices. We feel that prices may not be able to maintain their current levels as demand is not all that strong and buyers will offer strong resistance to another round of price hikes, a producer source reported.
Author:Anna Larionova
Category:General News
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