New threshold in Italy for April PP offers

Since the April propylene contracts settled with a substantial increase of 70 euro/ton last week, some new PP offers for April have emerged in Italy's spot market with a similar move, climbing above a new threshold. The homo PP market has been mostly pegged at 1,085-1,200 euro/ton FD North Italy (90 days deferred payment throughout March). As for April, a buyer reported that he received new offers from a West European producer at 1,205 euro/ton for homo PP FD North Italy (30 days deferred payment). A trader also reported that he is considering an increase of 70 euro/ton for his West European offers at 1,200-1,210 euro/ton for homo PP and 1,250-1,260 euro/ton for PP block copolymer on FD North Italy (90 days deferred payment). A buyer producing cosmetic and pharmaceutical packaging also reported that he received early April offers for West European homo PP and PP block copolymer from a distributor respectively at 1,260 and 1,310 euro/ton on FD North Italy (90 days deferred payment basis).
These offers represent increases of 100 euro/ton over last month. Another month of increases has disappointed him as he thought that the fragile demand conditions would not support further increases. Although he has not received offers from his regular suppliers, he reported his bids with increases ranging from 30 to 50 euro/ton. After talking to some of their suppliers, he felt that some of them are ready to concede to smaller increases than that of the propylene contract in order to remain competitive. Some competitive offers below the 1,200 euro/ton threshold are likely to remain in place in the spot market next month since a trader offering Indian origin has already remarked that they are planning to raise their homo PP offers by 60 euro/ton to 1,170-1,180 euro/ton with the same terms. More offers are expected to emerge in the days to come. (Source ChemOrbis)