SINGAPORE (ICIS)--Slow downstream turnover of finished goods in Thailand have dampened demand for polypropylene (PP) resins, limiting the gains in domestic and import prices, industry players said on Friday.
Offers from local producers were higher, with most seeking better margins in the wake of depressed spot prices in the previous month.
However, few were successful in pushing through firmer prices, and buyers’ resistance remains evident.
Offers for loally produced PP injection and flat yarn grades were at Thai Baht (Bt) 38.0/kg and above for prompt delivery cargoes. However, some market players say that lower offers at Bt37.5/kg were still available to some buyers who typically buy bigger volumes.
Local distributors were holding on to relatively low inventories in the week. However, this did little to support local prices as most remain reluctant to stock up on resins amid the lack of active buying from converters.
However, most market players believe that these distributors will likely have to return to the spot market by the end of the month as stocks on hand would have dwindled out by then.
Downstream demand for finished products has been particularly weak due to wide-spread floods in the north-eastern regions of the country. Some market players say that demand for consumer goods has dropped by almost 50% in certain northern regions of Thailand.
The flooding has also hindered converters’ delivery of finished goods to end-users in the country.