China’s PP market sentiment strengthens following Mailiao pipeline fire
01 August 2011 10:42 [Source: ICIS news]
SHANGHAI (ICIS)--The fire at a propylene pipeline at a key Taiwanese producer’s Mailiao petrochemical complex over the weekend has boosted sentiment in ?xml:namespace>China’s domestic polypropylene (PP) market, distributors in China said on Monday.
China’s distributors have been bullish about the PP market in August and September as several local producers have scheduled plant turnarounds during this period, which are expected to lead to a tightening of domestic supply, distributors said.
Distributors have become even more confident about the market outlook in August following news of the weekend fire at Mailiao. This is because Taiwan is a key exporter of PP to the China market, the distributors said.
In China, distributors raised their offers for the benchmark PP injection and yarn grades to CNY12,700-12,800/tonne ($1,972-1,988/tonne) ex-warehouse (EXWH) on Monday. So far, most distributors have declined to accept bids below this level, which is CNY100/tonne higher from last week’s offers, the distributors said.
China imported 215,000 tonnes of PP in the first half of this year, of which 9.6% came from Taiwan, according to China customs’ data.
Some market sources believe that Formosa Plastics Corp and Formosa Chemical and Fibres Corp (FCFC) accounted for 70-80% of Taiwan’s PP export to China in the first half of this year.
($1 = CNY6.44)
Additional reporting by Angie Li, Ingrid Fu, Lizzie Yu
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