Feiplastic ’19: US PP exports concentrated in Central America, rare in South America

SAO PAULO (ICIS)–US exports of polypropylene (PP) remain largely concentrated in Central America and are rarely being seen in South American markets, several participants said on the sidelines of this year’s Feiplastic.

The US exported only a small volume of PP in 2018, as prices for US material were not competitive relative to prices for other major global producing regions during much of 2018.

2019 has brought a significant shift in supply and demand dynamics in the US PP industry, with long inventories for both propylene and PP pushing sellers to both resume exports and to seek out alternative export destinations.

Participants at Brazil’s premier plastics trade fair said that US PP exporters have not yet started to make any serious inroads into South American markets due to logistics issues as well as the ongoing availability of competitive prices from regional producers as well as Asian and Middle Eastern exporters.

The bulk of US PP exports continue to move to Mexico and Central America, which are accessible by railcar from the US.

US PP shipments would needed to be bagged prior to shipment to deepwater markets such as South America and bagging facilities along the Gulf Coast have limited capacity for PP due to a large new influx of polyethylene (PE) for export.

PP is used for packaging, ropes, carpets, plastic parts, loudspeakers and automotive parts.

Feira Internacional do Plastico (Feiplastic) takes place on 22-26 April in Sao Paulo, Brazil.