PP firm expectations for July in Italy

The changing sentiment in Italy's PP market has been somewhat validated by the July propylene contract, which settled late last week with 22 euro/ton decreases. Not only the recent monomer contract settlement, but also the emergence of low European offers as well as the appearance of import cargoes with competitive prices are cited amongst the factors weighing down on the market sentiment.
However, producers and some traders are still holding onto their firm expectations for July, defying the views that the market may start the feel the impact of the global downturn next month. They are mainly supported in their argument by tight availability in the region. Even after the lower monomer contract settlement, some traders remark that they are planning to offer PP at rollovers or with modest increases on the back of their limited availability while producers are expected to start seeking 20-40 euro/ton increases in order to guarantee rollovers. However, a trader admits that he expects to see small discounts of 20 euro/ton from June, revising his sell ideas lower accordingly.
Meanwhile, imports continue to find their way to the region at competitive prices. Following the reports about Middle Eastern homo PP at 1,135 euro/ton CFR Italy, subject to 3% duty, cash, a buyer received more offers for Middle Eastern and Indian origins at 1,160-1,180 euro/ton on DDP terms including all applicable costs to his plant. Nevertheless, buyers are still not rushing to conclude deals for these cargoes as they are wary of the current changing sentiment.
The local market for homo PP is reported at 1,250-1,370 euro/ton FD North Italy, 60/90 days deferred payment. (Source ChemOrbis)