PP imports and exports in the third quarter

According to the China Customs, China imported 299,033 metric tons of polypropylene (PP) in Sep 2024, down 11.37% compared to the same period of last year, and down 4.84% from a month earlier. Of all imports, homo PP imports accounted 189.1kt, down 11.24% compared to the same period of last year; co PP 99.3kt, down 12.26% year-on-year; ra co PP for 10.6kt, down 4.62% year-on-year.

The total export volume of PP in Sep 2024 was about 194.8kt, a year-on-year increase of 56.34%. Of all exports, homo PP exports accounted 171.8kt, up 53.85% compared to the same period of last year; co PP 19.5kt, up 84.41% year-on-year; ra co PP for 3.5kt, up 48.83% year-on-year.

In the third quarter, the import volume initially increased and then decreased. In July, there were still some arrivals of previously forward cargoes in addition to the current month's supplies, leading to an increase in imports compared to June. However, in July, domestic spot prices continued to weaken, and the price spread between domestic and overseas markets widened, resulting in decreased enthusiasm from overseas suppliers in offering prices for China. In August, although the price spread between domestic and overseas markets narrowed, domestic demand remained weak, with traders and downstream buyers purchasing on need, leading to a decline in import volume. In September, affected by negative factors such as declining economic indicators in the domestic market and falling oil prices at the beginning of the month, market sentiment turned pessimistic, downstream buying interest was low and import volumes continued to decline.

Comparing to previous years, the import volume has also been declining year by year, but since the beginning of this year, the import volume has remained relatively stable, averaging around 300kt per month.

In terms of exports, the domestic PP export volume in the third quarter initially increased and then decreased. In July, the export volume declined compared to June due to reduced demand in major export markets such as Southeast Asia and South Asia. In August, container shortages eased and freight rates declined. Moreover, domestic market demand weakened, thus exports saw a significant increase compared to July, driven by relatively strong demand from regions like South America and Africa. In September, although the PP export volume decreased, it remained at a relatively high level.

Comparing with previous years, since 2021, PP export volumes have consistently remained high, especially notable from March to May each year. In the third quarter of 2024, PP export volumes were significantly higher than the same period in previous years, which is closely related to the domestic and international supply and demand situation.

In terms of imports, relatively speaking, the import market is less likely to experience significant fluctuations, and PP import dependence is decreasing year by year. Given the ongoing pressure on domestic supply, overseas suppliers' enthusiasm and volume for offering to China may further decline. However, certain high-end raw materials will still rely on imports.

Regarding exports, as domestic supply pressure continues to rise and market competition intensifies, the sentiment for production and trade exports remains positive, serving as a viable measure for companies to help themselves. Additionally, domestic PP prices are often at a low point compared to global prices, providing room for exports. Therefore, export volumes may remain at high levels.